All Forum Posts by: Jeff Stephens

I vote for your next purchase to be with seller financing! This could be great for many reasons, not the least of which is what you've described.  

Hey Jack! I agree that learning the art of sourcing off-market opportunities will serve you very well--both now, and in the future...whether you perceive the market to be competitive or not.  When you are sitting in the Seller's living room yourself, you're not as affected by what's going on in the overall market.  

Hey Tristan--congrats on compiling a list, and good work so far! I buy all my properties through direct mail marketing, and my advice is this:  don't let it look, feel or sound like investor marketing.  I recommend writing a letter that feels absolutely like it came from a regular person, and is being sent to a regular person.  That means avoiding the typical investor words like "as-is," "cash," "close fast," etc.--I'd even avoid using the word "investor" itself.  Just introduce yourself, tell them why you are reaching out, and express sincere interest in speaking to them if they should ever decide to sell their property.  One of the big reasons this works is really very simple:  if people feel like you're a regular person, they will feel it's "safe" to contact you back; that they won't have an uncomfortable, high-pressure conversation.  So if you make it your goal to make it feel like a safe conversation, people will take you up on it.  Good luck!  

Alice, do you own any other properties?  If so, there's the possibility that you could tap into the equity of those properties to secure a loan for the down payment; or, similarly, you could offer the other property as collateral for the seller themselves to be secured for a second loan as your down payment.  

Also, there are other ways to get cash, such as 0% interest business credit cards, which could be useful for quick, short-term needs like this. 

OK, great. In that case, here's what I do: I just use a standard purchase agreement from your local area, as the body of the agreement--this is where you can capture the key elements that are present in any deal.  But then I use an addendum, which because it's an open-ended form, is really well-suited to capture all the unique elements of the seller financing terms you've negotiated.  Be sure to capture EVERYTHING related to the terms, so that when you go to create the promissory note, there's nothing left to be decided/negotiated--it's all captured in that addendum.  

Daniel, you've gotten some great responses from Jonathan and Colby here! Direct mail is exclusively what I do, and I really agree with them--it's important to think through your specific audience. And it's important to NOT just do what everyone else is doing (the "we buy houses fast cash as-is quick close" stuff).

What I do is very, very simple:  I know my audience, and how I want them to perceive me (in marketing we'd call this "positioning").  Then I simply send them a very nice, polite, personal letter introducing myself and expressing a sincere interest in their specific property (named by address)...and I ask them, "if you would ever consider selling this property, would you give me a call? It would be an honor to discuss it with you."  No pitch, no offer, no mention of pricing or financing structure--just a nice letter from one landlord to another, inviting a conversation whenever the time is right for them.  

Hey Bryant, congrats on finding yourself a seller financing deal!  I'm a huge advocate of this, and it's pretty much exclusively what I do as well.

One thing I wanted to clarify is this: when you say "owner financing contract," are your referring to a purchase agreement? Or are you referring to the closing documents--such as a trust deed and promissory note--that you will need at closing?  

Hey Gary!  One thing we don't yet know from your post, which is an important part of the overall recipe, is this: "what type of properties do you want to source, and for what type of deal?"  For instance, if you want to source fixers for wholesaling, you may choose a different strategy than if you want to buy higher-end properties for long-term holds.  Let us know what you're looking to do!

Good work, my friend!  :) 

@Dylan Baxter  Yes, they were happy to provide them before I closed any deals with them (I've been getting the lists for many years).  It's a very easy and simple customer service function for them.