How to Find Deals

[CVentures1B12]

I could not find another thread of this nature, but if there is one, feel free to lock and send the link in a post, otherwise...

HIT ME!

How do you guys do it? I have a full time job, which puts a bit of a hinder on the time that I can spend on buying properties, but what are some methods, etc, that you use? I just can't seem to get past the people who think that they have bargaining power in this market! I need the desperate seller!

I HAVE to get my first deal before the end of the year...

I am a sponge and ready to rock like --> :jackson:

Ow!

Best,
Josh

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[Runum]

I can agree with looking at REO's but just because it's an REO does not make it a deal. In our area we are not seeing the deep discounts for most REO's. It is still the needle in the haystack thing.

You need to have your funding in place when dealing with REO's and distressed property. If it's truly a deal it will go very quickly.

I also agree with knowing what you're going to do with it once you buy it.:cheers:

 

[CVentures1B12]

To answer your question first: I plan on renting. I want to buy and hold in order to build some skin in the game where I can eventually move on to commercial. I was going to go ahead and skip to commercial because I have a partner with access to money, but he doesn't want to move as fast as I do.

Here is the dilemma: No capital. The banks are going to want a 20% down (for the most part). REO's are a very good idea, for sure, but they are also not going to want to lease-option, be creative, etc.

Please criticize, advise, etc...keep it coming!

 

[CVentures1B12]

Runum:
Thanks for the advice, I agree with what you say about REOs. See previous post.

I have a great lender who is just itching to get me started and start really building a relationship, but I have been working hard (when I can) to find something and nothing seems to be working. I don't want the path to be laid out for me, by any means, I guess I am just doing something that I need to change and I am at a loss on how to augment my search.

Postcards
Letters
Expired listings?
Also, maybe listings that have been on the market for a while?

Just a few things that I have thought of/picked up from some of you guys.

Keep it coming though!

Best,
Josh

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[Runum]

Buy a 2-3-4 unit property first. Live in one unit and rent out the rest. Qualify for mortgage under first time buyers programs that require less money down. Do your numbers and make sure it will cashflow.

 

[Charmed Angel]

Here is the dilemma: No capital. The banks are going to want a 20% down (for the most part). REO's are a very good idea, for sure, but they are also not going to want to lease-option, be creative, etc.

Please criticize, advise, etc...keep it coming!

The first thing that comes to mind is to partner with someone. You don't have capital or time, but what about knowledge and credit?

As far as finding deals. I agree with JScott. There are a lot of deal right on the MLS. Also, Craigslist. I have found some of my deals just by networking with others. Let everyone you know, know that you are buying discounted or distressed property and can help anyone that is in a poor situation. You'll be surprised at what people will bring you!

 

[CVentures1B12]

JScott:
Save Cash - Check (or at least doing it, don't have a ton saved...but definitely doing it)
Credit - Check (right over 720)
Partner with Cash - Check (more interested in Commercial Deals and not wanting to do anything until Spring next year)

I seem to have all of the ingredients, now I just need a deal to finally bake the dish.

Runum:
I like your idea and have been leaning that route. Albeit, nowhere near Fastlane at all, I think it would be a great start.

Any more ideas/steps to finding them? Besides a realtor, MLS, etc?

Best,
Josh

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[CVentures1B12]

The first thing that comes to mind is to partner with someone. You don't have capital or time, but what about knowledge and credit?

As far as finding deals. I agree with JScott. There are a lot of deal right on the MLS. Also, Craigslist. I have found some of my deals just by networking with others. Let everyone you know, know that you are buying discounted or distressed property and can help anyone that is in a poor situation. You'll be surprised at what people will bring you!

Let's change this situation just a bit. I have Credit, Knowledge, and Some Time. No capital. I have been working the Craigslist angle for a little while now, just not very consistently. Need to devote a solid 2-3 hours a week to that. Also, need to find a realtor that is willing to work for me.

Hmm...funny how when you ask for something you end up answering it yourself...

 

[SteveO]

Time and effort are fundamentals with most types of investments. You will have a reasonable idea of a good deal if you look at 20 properties. You eill have a better idea if you have looked at 200. It sounds like you have time constraints. You could abbreviate some of your searched work off of some drive-by viewings.

Looking at volumes is part of the eduacation and calibration process though.

You do need to get past the capital part. Access to money is critical. It will be rare that you will find the combination of price and terms in a deal.

 

[Charmed Angel]

Josh,
Why do you Need to buy before the end of the year?

It is good to have goals, but it can also be bad if you are pressured and rushed to do something that your not that experienced in just yet. You could miss potentially damaging facts when doing your due diligence.

I think it's :great: That you have a cash partner lined up to invest in commercial! The spring is not too far away, and commercial deals ussually take longer to close anyway, like 2-4 months. So if you start looking now, you'll get a better understanding and knowledge of your market and come Feb, only 2 months from now, You will have hopefully found something that you can partner with on.

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[CVentures1B12]

Time and effort are fundamentals with most types of investments. You will have a reasonable idea of a good deal if you look at 20 properties. You eill have a better idea if you have looked at 200. It sounds like you have time constraints. You could abbreviate some of your searched work off of some drive-by viewings.

Looking at volumes is part of the eduacation and calibration process though.

You do need to get past the capital part. Access to money is critical. It will be rare that you will find the combination of price and terms in a deal.

Is there a possibility, though, that I will find a deal with just terms? Even if there is little/no equity in the property, maybe the seller will be ok with taking over payments, etc? Thoughts on this?

Josh,
Why do you Need to buy before the end of the year?

It is good to have goals, but it can also be bad if you are pressured and rushed to do something that your not that experienced in just yet. You could miss potentially damaging facts when doing your due diligence.

I think it's :great: That you have a cash partner lined up to invest in commercial! The spring is not too far away, and commercial deals ussually take longer to close anyway, like 2-4 months. So if you start looking now, you'll get a better understanding and knowledge of your market and come Feb, only 2 months from now, You will have hopefully found something that you can partner with on.

I don't HAVE to get a deal before the new year comes around, I would just like to. I definintely don't want to be rushed, but I think that if I set that goal, then even if I don't achieve it, a deal will be shortly behind the date of that goal. Just something to strive for and work for.

Best,
Josh

 

[ryanpal]

there are many creative methods to RE investing. do you want a quick profit or a rental that positive cash flows?

assuming it's the prior. i would suggest creating your buyers list and then providing them what they want. you seek out properties of interest...you put the buyer and the seller together....and assign the contract (wholesaling).

wholesaling has been recommended for those with little or no capital

ryan

 

[CVentures1B12]

I understand and support the concept of wholesaling to the max! Problem right now seems to be that no one is wanting to rehab/retail. The people with the cash are holding on tight and riding the wave...but this a great avenue, nonetheless. Can we elaborate a bit more on the marketing to find these deals?

I spent last night devising a plan *diabolical laugh* haha.

Drawing up e-mails, letters, etc for marketing. But still welcoming all input!

Best,
Josh

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[hatterasguy]

I find deals a number of ways. Mostly by looking at a ton of property, I'm always looking at property, every single day. I have been for years. I also know exactly what I'm looking for so I know it when I see it.

My first deal I found by knocking on their door and asking if they want to sell. They said yes, so my partner and I bought it. I knocked on about 12 or 15 doors before getting a yes. Not that hard to do, took a few weeks to catch everyone at home, plus I work nearly full time and go to school full time.

My second deal I found by driving by it on my way home and seeing a FSBO sign planted on it. I knew it was something I wanted to buy, and the price the lady was selling it for was good. That deal I did over the phone in 20 minutes. Everything was in place.

Now I have agents that send me stuff, I have one sitting next to me now thats pretty good. Lots of neat stuff on the MLS now that wasn't last year.

To find a deal you really have to know your market inside and out. If I'm driving in the car with you, in your market I should be able to point to a 3 family and say how much is that worth at FMV, what would make it a good deal for you, and what will it rent for per unit. You should know all the answers off the top of your head, and they should be accurite.

I agree with what JScott said above about saving some money and finding a partner. In this market you really need some cash.

But if you want to find a deal here is a good way to find your first one. Its clumsy and time consuming but, I think the best way to really learn. Go and drive by a few multi family's that you like. Find out who owns them and call them up or go knock on their doors. Ask them if they want to sell, if they say yes offer a price that works for you without being insulting. The best deals never get listed, and since you are new you don't have the network of contacts to bring these deals to you, so you need to invest time to find them yourself. To save time you can just ask if they want to sell, than do your homework and make them an offer. But at first you really should do your homework and than make an offer so you learn. The weekends are the best times to get in touch with people, you should try to talk to 2 or 3 this weekend. Keep doing that and you will find a deal.

My 2 cents.

 

[20art]

Ask them if they want to sell, if they say yes offer a price that works for you without being insulting.

My 2 cents.

Wouldn't it be better for the opposite side make the first offer?
Since it might have the chance of being lower than expected

 

[hatterasguy]

Well whoever names a number first loses, thats negotiation 101. But in my experiance they usualy ask you for an offer. If you can get a price out of them first by all means do so.

Learning how to talk to people and feel them out is an important part of this.

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[20art]

Cool thanks.
I just remembered JScott's negotiating posts

 

[razda]

Have you tried going to the courthouse to look at the pre forclosures in your area?. They are all on a list that is public record and can be looked at by anyone. In fact most cities and/or counties will have it accessible from the internet. Simply collect the names and address of the owners and send out a flyer. Like was mentioned previously, you could go through 100's with out much response but in today's market there will be 100's if not more on the list. You can try putting out signs on busy street corners or an add in the newspaper. I have even seen billboards along the freeway.

Then set up a answering system that people can call 24 hours a day to get a message about what you can do to help them and then they can leave their name and phone #. It seems that most people like to talk to a recording when under stress. :coco: All of this should get people started calling you with their problems. If their situation is desperate enough they will call you and half of your battle is won.

Hope this helps

 

[CVentures1B12]

That sounds like a great idea. I have started doing the following:

1) Expired listing marketing - sending out about 10 letters a week to expired listings (staying very area specific, so there are only about 10-15 that expire each week)
2) Enlisting a realtor to send out Letter of Intent offers - sending at minimum 20 offers each week for 60% the asking price
3) Posting ads on Craigslist, Backpage, etc.

I think an answering service would be ideal. I know they cost money, probably pretty cheap. Does anyone have a link to an affordable, but good answering service?

I also am going to get a quote on some signs and post them around, starting at the beginning of the year.

Getting on the ball!

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[unicon]

Remember most real estate are BAD investments!

Treat your first deals as a learning tool to purchase, remodel, hold, and exit.

Generate some capital from a volume concept of good and bad deals.

Once experienced focus on property you want regardless with a long term slant, in other words find properties that you like and that you WILL buy in the future as they are just holding it for you until you are ready - continue to file away all information about the property for years if necessary.

This is not necessarilly related to listings but also drive by - which you can go directly to the owner

If you have an inventory of prioritized properties people are holding for you - you can write letters directly making offers at different timing. It can be a permanent process.

Focus on making one great deal rather then being fed by a Broker who knows little about investing or building a portfolio of complementary properties.

If you are into quality your portfolio needs will change with each acqiusition as the success of adding to your inventory will possibly change the identity of the next property you buy

This is more a quality concept then a volume concept

 

[CVentures1B12]

Thanks for the info Unicon.

I have actually been having a decent amount of response from Expired listings. I have sent out 25 letters so far with about 6 call-backs. Pretty good percentage!! None have moved forward with a deal, but if I can look at them all and buy one...it was worth the 10 bucks for the stamps!

Anyone else think of some creative ways to find deals and motivated sellers? I have recently started driving to garage sales and just talking. Great places because A) 70% of garage sales are people that are moving and B) I usually find something really cool there! haha

-Josh

 

[hatterasguy]

I disagree with part of what you said unicon, you shouldn't buy bad deals. You also can least afford a bad deal when your starting.

Your first deal needs to make good money, like every deal after that.

If your not making money why bother buying RE?

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[NoMoneyDown]

That sounds like a great idea. I have started doing the following:

1) Expired listing marketing - sending out about 10 letters a week to expired listings (staying very area specific, so there are only about 10-15 that expire each week)
2) Enlisting a realtor to send out Letter of Intent offers - sending at minimum 20 offers each week for 60% the asking price
3) Posting ads on Craigslist, Backpage, etc.

I think an answering service would be ideal. I know they cost money, probably pretty cheap. Does anyone have a link to an affordable, but good answering service?

I also am going to get a quote on some signs and post them around, starting at the beginning of the year.

Getting on the ball!

You should listen to some REI marketing gurus, like Richard Roop, for some creative marketing ideas for finding deals.

 

[unicon]

hatt

You missed my point, good and bad deals are relative and may have little to do with making money but with efficiency, synergy, and time.

A good deal for you as a beginner may be a terrible deal for myself!

The most valuable point is that all deals should make money, but that the knowledge gained from making the deals are the vision for the future.

You will make mistakes along the way or you will never be successful!

 

[unicon]

josh

Try centering in on a property or type of property you really want regardless who owns that property or if its for sale or if its a divorce or if its a dysfunctional property.

You want to do real work of adding value.

Once you find your optimum property write a quality letter rather than a form letter, the point is to build a file on the property. The quality of the letter anticipating all negative responses and answering them before potential seller can ask them. You will learn negotiation from this.

Writing letters of quality will get you a deal when everyone is sending out volume letters. Research the property at court house, know what they bought it for, square footage, value per foot, know their needs and wants, try to keep communication going even if sale is to be far off in the future.

Currently today I will spot a property I want for my portfolio and will add it to my top 5 that I am looking at buying at some time in the future. I have the attitude that nothing will stop me from owning that property in the future if I want it bad enough.

The quality of your communication (as opposed to volume) is the true learning and will trigger deals that will shock yourself. You will build on this so every letter written will be an improvement over the previous.

With the above mind set and tools nothing can stop you, it is within yourself.

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[hatterasguy]

Unicon good point, I guess I missed it.

 

[NoMoneyDown]

You find a great deal, you'll find plenty of buyers. And once you find those buyers, you'll have a much easier time marketing future deals. It's a snowball effect, and it will continue to get easier and easier the more you do it.

Exactly. Not only is it a snowball effect with your buyers, but also one with your entire "team". IOW, you'll begin to find more and better support members as your network expands exponentially. You may find a CPA, who knows a good attorney, who may know a good probate attorney, who knows ...

 

[CVentures1B12]

Thanks for all of the help guys. I guess, FScott, to answer your question, I have made about 5 offers since I posted a month ago. Most of these on people that have responded to expired listing letters that I sent out. That is definitely not as high of a volume as most, of course I do have a full time job and another business on the side that I run as well. No excuses, just a limited and set time to devote to Real Estate.
You are correct, though. I think that making a set goal of X offers per week would be an ideal situation. I have just finished my daily schedule which allocates every minute of everyday to some activity. Pretty amazing when you do that and you REALLY see how much time you do have after work (without TV of course).
Anyway, not to derail, I am looking into wholesaling (as FScott suggested) and also focusing on Lease-options and other creative financing techniques. How are some others out there getting some deals aside from going to the newspaper? Or do people actually find deals there?

Best,
Josh

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[CVentures1B12]

Wow...came to update everyone on the status of my finding deals and realized that I responded to JScott in the last post EVERYTIME as "FScott"...sorry...must have been thinking of the Great Gatsby, haha.

Anyways, I have been taking it extremely slow and on purpose also. I was pushing things so hard that I was getting WAY to ahead of myself. A deal came along and I had to let it go because I didn't have all the necessary documentation, forms, etc...basically, didn't actually have my ducks in a row that I thought I did.

As an update, I have finally printed, copied and ran by a legal team, the infrastructure for my RE biz. All Analysis, Acquisition, Finance, Lease/Rental and Property Management forms and charts are filed neatly and ready for use.

This is done just as I picked up another deal that I am working out with the owner of a mortgage company who wants to move to commercial. He got rid of all of his SFHs except for the 4 best producing. Worked on a commercial deal for a year and all of a sudden the bank wants him to clear his debt sheet. He MUST get rid of these houses, has already made his money for the commercial deal and just wants to get them to me to help both of us out. He is willing to give me a 0 points/0% mortgage...whatever it takes to get his commercial deal through!

Goes to show that sometimes motivated sellers are actually very well to do! Thanks everyone for all of the help!

 

[hakrjak]

Just noticed this thread --

There is no shortage of deals out there today, and they're everywhere. I guess it depends on what you call a deal. If you're waiting for that one elusive deal where you could make $60k, you might work on that day in and day out for over a year to just locate it. Or... In that time, you could do 5 deals for $20k each, which are plucked right out of the MLS.

Cheers,

- Hakrjak