All Forum Posts by: Dean Meier

Jim: I can only give you my anecdotal answers and how I do it here in Minneapolis.  For non owner occupied single families in this area it seems in the second tier burbs there are between 100 - 150 names that list source gives me.  I mail to those 150 about every three weeks.  My intention was to do every week but it's tough.  I've created a hand writing font from the net to address the envelope.  I've terrible hand writing so the front of the envelop looks authentic.  I've been using a spider man stamp.  Some people say use the flag.  Spider man seems to get them open.  My response is all over the place.  last one I did was 2%.  One before was 12%.  I think you should be able to get 1 deal out of around 100 mailers.  That's my hope.  Could be unrealistic but it's working so far.  The mailer thing is a bit new to me so we'll see if my spread sheet changes.  Oh, I use a simple spread sheet to tract responses.  I always answer the phone with my local number.  ALL of the responses are from people who are not motivated.  They have renters and are happy to wait out their price.  It seems as though you need to be diligent and keep hitting that 1 in 100 that will take an offer that works for both of you. 

As a side note, I've run in to a couple of people that have some deep pockets by mailing these letters.  Now I'm forming relationships with them and lending money on projects together.  Squeeze every dollar's worth out of  the letter .  There's another answer to your question I think.  It costs around $1 per letter if you do them yourself.  Fifty cents more if I pay someone to fold and stuff etc. 

@Westin Hudnall  @Jon Klaus @Dawn Brenengen

Wow, I'm flattered you would want them.  Give me a couple days and I'll tidy them up a bit.  If I'm going to post them for the world to see, they'd better represent me well.  

Westin: this may be a little bit of unsolicited advice but, it's a good idea to sit down and write a policy manual for how you're going to manage your properties.  Then, follow everything in the manual.  If you ever need to make a decision just do what your manual says.  You will always have the policies to blame when someone says you're treating them unfairly and you'll rarely have a decision to make.  If you'd like, I'd be happy to send mine for your adaptation.  Or, just go and pick any book on land lording and follow that advice.  Treat your investments like a business!

Hey Timur: there must be a ton of competition to lend in your area.  Zero points on hard money is outrageously cheap.  That is unless the interest is 3% a month.  If I could get zero points or 6% terms I would spend my time finding deals and not be worried about the cost of the money.  There must be some kind of catch to those offerings? 

 A quick note on soft money;  if I'm looking at a deal which involves a long term hold, I will usually want equity and a believable plan on how my money is getting returned.   

If you're not seasoned in real estate, it's going to be a long hard process for you to go to a bank and get started with a fix and hold today.  You can do it, but make sure you have a good loan officer who will hold your hand.  Also make sure you know what you're plan is going to be and understand your debt to income ratios.  You could end up with a cash flow negative property pretty quickly.  

Hi Nature: There probably are 25,000 posts about hard money but I'll try and save you some time.  Which, by the way, is one reason to use hard money. 

Hard money is a quick way to get financing that you might otherwise not have access to.  A good hard money lender should be able to make a decision in days instead of weeks and sometimes months like a traditional lender would take.  

A hard money lender will care more about the project than they will the borrower.  When I'm looking at a deal, I care mostly about the collateral that I may have to take back if the borrower doesn't perform.  For people just starting in the real estate biz or those who don't have great credit,  this is a big plus.  You do however have to have the skills to find a good deal and present it in a half way coherent way.   

While hard money will cost more ( usually a certain amount of " points " up front and a higher monthly interest, it is also a valuable tool.  A good partner will not just help you with the money but they will have done lots of deals.  They'll have contacts for contractors, title companies, and pretty much everything else you'll need in the real estate world.  They should be a great resource for you to ask advice when you get stuck on something.  Remember, their money is at risk so they will want to protect it.  

While hard money may cost more than a bank, it's just another cost of the transaction.  Develop a relationship with a money partner and build their cost in to the deal.  A good partner will bring fast money and value to your deals.  Most likely deals you wouldn't have without them.

Hi Brain:  

My experience has been if you have 5 quality showings and not one qualified person fills out an app, you are asking too much.  If your issue is not enough showings then you have an advertising problem. 

BTW, before vacancy rates got so low, the best advertising in the world for me was " house for rent signs " on telephone poles in the neighborhood.  Today Craigs List and Postlets gets me dozens of calls. No need for the signs.

I agree with the posts above.  Ditch the property manager.  Even if they're not the leasing agent, any manage worth their price will be able to help you get the place filled.  They shouldn't be making money if it's empty.  

Hi David: I recently had an active military tenant get deployed.  The one thing I would make sure to be aware of next time is the decreased amount of time you have to find a new tenant.  The law states the deployed tenant has 30 days then they can leave.  All other state regs seem to apply.  It never occurred to me that I could verify her orders.  However, I was happy to let her go if she wasn't happy.  Not hard to find good renters these days.

Dean