All Forum Posts by: Jonathan B.

@Sam Shueh, I understand the #'s regarding Direct Mail. Here is some additional #'s to account for. 

Open response rate of Direct Mail = .1% (.2% if you are lucky, but sometimes can be less than 1% depending on your market of competitors). 

7,2000 = 600 letters sent per month for 1 year (600 x 12 months)

72 = 7,200 x .1% (open response rate)

36 = 72 x .50% (homeowners that request to get off the mailing list or not interested in selling).

18 = 36 x 50% (total # of possible deals)

1.5 monthly average deal = 18 divided by 12 months a year

The issues I have with Direct Mail are:

1) Direct Mail is easy to learn, which makes it more accessible to every new wholesaler to do which creates more compeition.

2) Direct Mail seems to work best in big quanitites of mailers sent becuase of the level of compeition.

3) Kepping a solid tracking system for Direct Mail is not fully accurate

a. You can only measure phone calls and return letters. 

b. Cannot measure whether homeowner recieved your letter and opened it.

4. Actual cost is different than your equation posted. Lets look at the actual cost:

• Rolls of stamps = $50 ($.50 per stamps x 100 stamp roll from Post Office)
• 100 envelopes = $4.78 (Staples - $2.39 per 50 enevelopes) 
• Yellow note pad paper = $5.79 (Staples - $5.79 for 100 sheets). 
• Total = $60.57 for 100 letters

Next, cost for 600 letters (which is 6 times 100 letters).

• $60.57 x 6 = $363.42

FInally, calculate cost for the year 

• $363.42 x 12 months = $4,361.04 .

This example assumes you are writing all the letters yourself. 

But, if you were to use those Direct Mail companies like yellowletters:

Handwriten style font on Yellow letter with envelope and stamp = $.79

Input this value into the above formula

• $.79 x 600 = $474
• 474 x 12 = $5,688

Conclusion, you are paying $1,326.96 ($5,688 - $4,361.04) more for Direct Mailing companies than mailing it yourself. 

The benift of a Direct Mail company, 

• You don't waste time preparing the letters nor sealing the envelopes with the stamp.
• They may be able to get you access to a different list of homeowners you can mail to. 

Now if you use a Post Card with the Direct Mail company, its cheaper 

$.40 cents each (small yellow postcard with letters/words/phrases)

Upgrading to a series postcard, the ones with a picture on it, it cost an additional .6 cents 

$.40 cents + $.06 cents = $.46 cents

With the same formula as above:

$.40 x 600 = $240

$240 x 12 = $2,800

If you generate a lead through Direct Mail, that turns into a deal of $5k, then Direct Mail is actually helpful. However, most newbie wholesalers may not even have $240, let alone $600 to spend on marketing each month.

According to Adespresso Blog about Facebook Ads cost, the average U.S. cost per click (CPC) in Quater 3 of 2016 was $.27 cents, which is much cheaper than Postcards.  Plus, Facebook has its own tracking tool to show me actual data.

@Jonathan B. can you give an update? Did you end up moving forward with this process? 

I'm facing a similar situation right now. 2nd place up at auction for ~$7k and 1st place up at auction for ~$65k two weeks later. Plenty of equity to make it a good deal. Trying to figure out if we do buy the 2nd place at auction if that gives us the right to payoff the 1st before its auction two week later. Thaniks! 

Almost every tax deed has similar circumstances. It's up to the clerk to notice the proper parties per statute. They do a pretty good job of it, so I wouldn't worry about it. If they do screw up, you will be made whole, so no big deal.

If an heir opened probate, that means there is money/assets leftover and they will probably pay off the taxes and sell the property themselves. But if you do win, let an attorney handle the quiet title. It's not complicated, and is more a formality that just takes time to notice the right parties. If no one comes forward, case closed. Or if it's going to be a rental, you can just wait 4 years and you can save a few thousand and skip the quiet title.

@Jonathan B. Being in probate, or not, deceased owner or not, none of it makes any difference.  FL law only requires the tax collector to send notice to the address on file for the owner, unless they actually have information for a different address/heir, period.

I don’t know how much you’ve followed the tax auctions here, but in the metro areas it is very competitive and go for much more than I’d, or most flippers, would pay.  There are a lot of “mini hedge fund” type groups buying for buy and holds.

Got it.  How Florida law will deal with that exact situation will require someone to hit the case law/books.  A key fact is whether the owner was still alive when the sale was noticed.  That one should be easy because the owner had notice and did nothing.  However, if the owner was already dead when the sale was noticed and no probate had been opened yet - that's the tough case.  It can conceivably go either way from a fairness perspective.  Either compliance with the notice requirements by the clerk's office will be deemed binding on the estate OR the estate should get another opportunity to cure for lack of actual notice.  Hopefully, either the Florida legislature or its courts have addressed this situation and you will have a clear answer.  Again, I personally have no clue how Florida law will answer this question.

We are.  For an auction to be binding on a property owner, as a general rule, the property owner must receive notice of the auction.  Make sense?  You can't auction off someone's property without letting them know about it.  Now, if the owner is dead, he can't be notified.  The administrator of the late owner's estate may or may not have received notice of the auction.  If no notice was given, then the administrator/heir likely has the right to challenge the binding effect of the auction on the late seller for lack of proper notice.  Again, a Florida admitted lawyer could advise you but these general principles are very likely to apply.  

 If this person is going through the effort of probate, they will likely pay the back taxes.

@Jonathan B. Might want to verify the potential heir has received the tax sale notification mail. If you win the auction there is proof that the heir indeed received the notification and could better help your quiet title case.