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Bandit Sign Placement that Gets the Phone Ringing

 

Bandit Signs Get Motivated Sellers Calling

Bandit Signs Get Motivated Sellers Calling

One of the biggest mistakes I have seen new real estate investors make is where they place their bandit signs.  Many times I hear them say that these signs don’t work or they keep on getting taken down soon after they place them.  It is not that the bandit sign is not effective, instead it is where they are placed that is ineffective. 

First, you must place them in the surrounding  areas of where you plan on buying real estate.  You want the people who live in these areas calling you to sell their home or to buy a home. 

Next, you should place these bandit signs in locations where people stop for a period of time or travel no faster than 25 MHP, so we can ensure they will see, read and respond to our bandit signs.  You will find that intersections, stop lights and signs, off ramps, and on bends of roads are the most effective locations to place these. It is advised that you place your signs near or around stop signs or telephone poles, but not on them.  I have found that in many areas if they are attached to these you will have a greater chance of them being taken down by city employees.  You could place these signs up high on the telephone pole, so it is not easy to take down too. 

Also, the placement of your signs will impact their effectiveness and their ability to remain in that location.  You will find some areas have restrictions on the placement of signs in their jurisdiction.  You will want to make sure that your signs are not too densely placed either or else you will run the risk of  gaining the attention of the city employees too. 

In addition to those suggestions, you will want to place them in locations where your target audience will go on a regular basis.  You will want to figure out where your prospects will go to shop, eat or drive by on a regular basis. For instance, you might notice that they go to Walmart, Target, McDonalds, Home Depot, AutoZone frequently.  You could even focus on more of the local establishments such as the  Local Bar, Local Eatery, High School Stadium, Local Gym, or City Buildings. 

Finally, it is inevitabile that you are going to lose a few signs along the way to weather and people taking them down from their property.  You will need to buy or create in bulk your bandit signs.  You will need to place at least 15 to 30 signs at a time.   It is a numbers game.  The number of bandit signs placed, the amount that are visible at any given time, and the ease of reading will all help ensure that your target audience sees and calls your bandit signs. 

In the blog titled, Creating Effective Bandit Signs,  I address how to put these signs together and what verbage to place on your bandit signs to get your phone ringing with motivated sellers and buyers looking for a lease option or seller financing. 

 

June 29, 2011 / 1 Comment / by / in , ,
Creating Effective Bandit Signs

Bandit signs are one of the best ways to find motivated sellers and credit challenged buyers.  You can use these signs to convey short targeted messages to your target audience.  You will place these bandit signs in locations that are outlined in my article “Bandit Sign Placement  that Gets the Phone Ringing”  to get the best results. 

I discuss the options you have to gain a business phone number in the article “Business Set Up for New Real Estate Investors”.  For now, let’s discuss how to make your bandit signs and what to put on them. 

You can take a very economical approach to putting your bandit signs together by using posterboard, black permanent marker, wooden stake or metal wire.  I recommend a fluorescent colored posterboard such as yellow, green, pink, and orange. You can use a bright yellow or even white.  You can get posterboard at your local dollar store.  It will not withstand the elements real well, but it is inexpensive to start advertising this way and inexpensive to replace.  You can attach the two posterboard signs to the wood stake via staples, nails, or gorilla tape.  You want to make sure that the sign will not curl or bend and remain attached to the stake, so your sign is seen by all who pass. Gorilla tape can be found at any home improvement store or places like Walmart. 

  I recommend using the largest point permanant marker you can find.  I recommend the Sharpie Magnum or Avery Marks Alot Jumbo Chisel Tip.  They are water resistent and dry quickly. You can pick up these markers at any arts and crafts store.   

The wooden stakes I mentioned can be found at any home improvement store in the lunber section.  It will be a 1″x1″ piece of wood with a angled cut on one end, so it can easily be hammered into the ground.  If you choose to go after the metal wire for your frame, you can get these in rolls at your local home improvement or local hardware store.  You will need tin snips to cut the wire.  You will get thick enough wire guage that is sturdy enough to hold the sign up in a wind storm, but thin enough you can cut with tin snips and bend.  You will bend the wire so you can put two ends into the ground and attach the two signs to each side of the middle of the wire. 

In a lot of cases, you will post these up in our target areas on Friday afternoon and remove them on Sunday evening.  If the weather forecast looks like it is going to have any precipitation, you might decide to not put them up that weekend.   I have found that I will be one of the few people who put mine up during this time and I get more calls, so it is up to you.  I will lose a few signs, but it is worth it for the amount of calls I receive. 

Before you attach the sign to the stake or wire frame, you will want to write your message on the posterboard.  If you are targeting motivated sellers, you will want to wire some of these messages on your signs:

  • We Buy Houses
  • Cash for Houses, Any Condition/Any Area
  • We Buy “As-Is” Houses

If you are targetting buyers that have credit problems, you will most likely be offering them a lease option or seller financing.  In that case, you might write on your signs the following to build a buyers list:

  • Rent to Own, #beds/#baths
  • $down/$month, #beds/#baths
  • Owner will Carry, $down/$month
  • Seller Financing, #beds/#baths

You will want to fill in the number of beds and baths as well as the amount down and per month for your specific property.  In addition to those, you will want to make sure that you have your phone number written with large legible numbers on the sign too. 

The dimensionns of your bandit signs should be 18″x24″ for roads where people will be driving by at 25-40 MPH.  It is the easiest size to see and the most effective sign size.  You can use the 12″x18″ for bandit signs that are going to be placed at stop signs & lights and off ramps.  You will want to place no more than 20-30 bandit signs spread out over a given area.  You don’t want to over saturate a given area with too many bandit signs or else you will have issues with them being taken down and violating local sign ordances. 

I recommend tracking where you are placing your signs each week, so you can go back and idenitfy where you are losing signs.  It will help you identify where your callers are finding your signs to call you.  It will help you focus on your most successful placement of your signs. 

Keep in mind, you will find that you need to be consistent and persistent with your bandit sign placement.  You will need to log which sign phrases and placement brings back the best results for you. If you do these things, you will have great ongoing success with your bandit signs. 

 

June 23, 2011 / 4 Comments / by / in , ,
Learn the 3 Steps to Successfully Investing in Real Estate Today!

I just wrote this article on Ezinearticles.  I think it breaks down the best and easiest way to be successful investing in real estate in a slow market.   These are princples that apply to most of the real estate markets across the United States.  The essentials steps to real estate investing is to  find the buyers first, then the properties and then make offers on these properties.  Read the full article here 

 

June 23, 2011 / by / in ,
Sell Real Estate Fast in any Slow Market using Seller Financing

What do I mean by slow market?  Well, if you local real estate market has an average days on market of 90 or more days, you are in a slow market.  It is in any real estate investors best interest  to start making money from any property quickly.  The sooner we can generate either an income or get cashed out, the better for any real estate investor.  So, how do you sell real estate quickly in a slow real estate market?

If you take into consideration what is occuring in our world today, you will realize that most prospective buyers have some credit issues, income issues, or other problems that will hinder them from acquiring their own loan to buy a home.  Also, we know that most lenders today are very conservative with their lending criteria. They require high credit scores, low debt to income ratios, larger down payments, and more conservative appraisals.  With that having been said, real estate investors have not only become sellers of real estate, but in many cases, financers of real estate.  

Seller financing is when you the seller of real estate offer the buyer of your property financing to buy it from you.  You will receive payments over time until it is paid off in full, they refinance and pay the loan off, or they sell it.  The buyer will own the property, thus they have the right to take over possession, improve it, and sell it any time they want to.  They will have this right for as long as they continue to make their monthly payments to you. 

Some of you might be thinking, my money or my credit is going to be tied up now.  How is this going to help me do more deals?  You are right.  If you don’t do this the right way, you will have your money and credit tied up for a long period of time.  The way to gain relief from this burden is to use one of two possible solutions.  One of the solutions is to sell your note to a promissory note investor ornote buyer.  The other solution is to team the buyer up with a credit repair specialist who will help them rebuild their credt. 

However, if you create a marketable note, you can sell that for a good price, thus you will have the money out of the deal and/or your credit free to go after another property.  I will go into the details of creating a marketable note to sell in an upcoming post.  Until then, you need to know that there are particular things that you must do when you set up your seller financing deals or else you will have an unsaleable note. 

A credit repairs specialist can be a great power team member.  They can help you credit challenged buyers build their credit faster, so they will qualify for a new loan to cash your financing out that much sooner.  The main incentive for the buyer to pursue credit repair is going to be the interest rate you are charging on their financing  and the balloon that you have coming due in a short period of time.  It gives them the extra sense of urgency and helps motivate them to work on repairing their credit. 

In addition to all of those, a savvy real estate investor should always structure a real estate deal that has a good profit margin for them.  What is a good profit margin?  It depends on the area and the person, but I would recommend a purchase amount no higher than 70% of fair market value.  It is best if there is a larger margin than that whenever possible.  You will need a larger profit margin, because if you decide to sell the note, you will be selling the note for a disocunt and you want to ensure you are making your profit needed in the deal.  It depends on how you set up the note as to how much of a disocunt you will incur from the sale of the note, as well as the note buyers investment criteria too.  Some of your note buyers will be more conservative than others, so they will take a steeper discount on the note purchase than another note buyer. 

In all cases, you will want to make sure you require a down payment too.  It depends on the area as to how much you can collect, but you need to make sure it is a sufficient amount of money.  Essentially, you want to make sure they have enough “skin in the game”, so they will pay each month so they do not lose that down payment.  It will be immediate cash that you can put into your pocket. 

One of the biggest benefits of selling your real estate with seller financing is that you can sell the property for top dollar in any market, because you are offering the buyer to get into a home that they would not normally qualify for in the current market.  They are getting terms, so they will not get price.  You will be able to sell the property a lot faster, because you are targeting a group of buyers that do not have a lot of other options to buy property.   There is a huge demand for this opportunity in our current world due to the financing options being so limited. 

 It helps real estate investors to start generating a secure and great monthly cash flow.  Understanding how to effectively implement this technique will help any real estate investor gain an extra added advantage in any slow real estate market. 

June 23, 2011 / 1 Comment / by / in
Most Effective Way to Calculate Offers for Wholesale Real Estate Deals.

Newbie and some seasoned real estate investors have a tendency to forget to calculate certain expenses into their offers.  In many cases, this mistake will be a very costly one that could turn a real estate deal from pofitable to financially detrimental.  Most property finders and real estate bird dogs are the most likely ones to forget to include some of these factors in their calculations, because they are not going to be the ones who will close the deals.

If you are doing wholesale real estate deals where  you are going to sell the information about a deal (bird dog), assign a contract you negotiated, or do a simultaneous closing, you will want to use a wholesale offer formula to calculate the nuber for each of these deals.  The wholesale offer formula consists of the following:

  • Determining current fair market value for target property
  • subtract all rehab and repair costs
  • subtract closing costs
  • subtract holding costs
  • subtract cost to borrow money
  • subtract real estate commission (if applicable)
  • subtract bird dog or assignment fee
  • subtract cash buyers profit

You will find the result will be the maximum amount you can offer on that wholesale real estate deal.  You will need to submit and offer for less than this amount, so you can have room for negotiation.  It is a formula that takes into consideration all the expenses that any real estate investor will incur with doing this particular wholesale real estate deal.  It will help any property finder, real estate bird dog, and wholesaler make sure that they have a deal that is attractive to cash buyers and other real estate investors.  It is the best way to make sure you are able to consistently negotiating profitable deals for you and your end buyers.

Keep in mind, if you run the numbers this way, you are best to pass these deals onto your rehabbers.  If you are looking to pass deals onto landlords, you will want to run the numbers in a different way.

Wholesale Deal Running Numbers

 

June 23, 2011 / 7 Comments / by / in , , ,
Get Your Real Estate Agents to Find the Diamonds in the Rough!!!!

In some cases, you are going to be dealing with a real estate that is an experienced investor themselves or working for other real estate investors too.  In that case, they will have a pretty good idea of what to look for in the MLS.  .  Yet in other cases, you might need to teach your real estate as to what to look for on the MLS to help you find the best deals. 

The MLS has many fields that a real estate can select to narrow down the results list on a search.  They can also perform a search for keywords too.  Some of the keywords that they search forto find bank owned properties that have been on the market for a bit  would be the following:

  • As is
  • Vacant
  • Price Reduced
  • Multiple Price Changes
  • Bank Owned or Lender Owned
  • REO
  • Fixer Upper
  • Needs TLC
  • Handyman Special
  • EZ to Show or Easy to show
  • Need Offer
  • No SPDS stands for – Seller’s Property Disclosure Statement or  no CLUE stands for – Claim Loss Underwriting Exchange or Comprehensive Loss Underwriting Exchange (depends on the state)

Some of the keywords that they search for to find Short Sales would be the following:

  • 3rd party approval
  • Short sale possible
  • Short sale approved
  • List price approved
  • Offer subject to lender approval
  • As Is
  • Price reduced
  • Multiple Price changes

You will find that any of these keywords or a combintion of them will lead you to distressed properties that you can wholesale easily. These keywords will lead you to distressed properties that will have motivated sellers tied to them, so you can submit your wholesale offers and have a greater chance of these offers being accepted.

June 23, 2011 / 2 Comments / by / in
Agent Version of MLS Listings Saves Real Estate Investors Time and Effort

There are different versions of MLS listings.  You will receive the client version of the MLS active properties if you do not specifiy that you want the agent version or you are dealing with a retail buyer agent.   The agent version will give you a lot more details about the property.  There are a lot of different things on this listing that could give you enough information to make offers without seeing the properties.  You will make multiple offers this way with contigencies, so you can get the ball rolling. 

On these listings, you will want to make sure you see the days on market (DOM) and the cummulative days on market (CDOM). You should have the real estate agent search for a certain number of days on the market or DOM.  In most cases, the best and truest guage of time the property has been listed on the market are going to be the cummulative days on market or CDOM.   You will want them to take the average days on market for that property in that area and tack on an additional 60 to 90 days on the market for the amount of days on the market that they search for on the MLS.  These are the listings that have been on the market the longest and have motivated sellers tied to these properties.  We will make low ball offers on these properties. 

You will want to note the financing portion of the MLS sheet for the listing you are looking at to see what it has listed there.  In many cases, it will state cash, conventional and fha.  If it does not state FHA it coud be a realtor oversight or mistake.  In most cases it is deliberate, they know there are items associated with the property that will not allow it to qualify for FHA financing.  The bonus for real estate investors is that most of the owner occupant or retail buyers are not going to qualify to buy this property without FHA financing in this real estate market.  We then han have less competition for these properties.  Our offers for cash are more appealing to the bank due to the fact that they know they will either have to sit on this property longer for a buyer or spend the money to make the repairs so that it could qualify for FHA financing. 

You will look for multiple price changes over the DOM and CDOM too.  These properties indicate a motivated seller who will likely accept our wholesale offers.  It will give us a feel for how much they have come down with each price reduction.  If we can get the agent to pull the property history on the MLS, we will see how many times the property has been listed, when and for how much.  It will show when an offer was pending and when it was cancelled and put back on the market.  It gives you a good guage of how much activity has been going on with the property and for how long. 

The agent remarks section can give you information about offers accepted (offer pending, back up offers okay, etc.), seller motivation(submit any and all offers, seller motivated, etc) , price reduction, property disclosures about condition (meth contamination, illegal addition, foundation issues, etc) ), seller information ( lender owned, short sale, 3rd party approval), property condition(TLC needed, AS-IS, no repairs, etc) , and more.  It can help you gauge what is going on with the property quite a bit better. 

You will find that you will consistently find distressed properties that will have motivated sellers tied to them, so you can submit your wholesale offers and have a greater chance of these offers being accepted.

 

June 23, 2011 / by / in , ,
What is ARV versus FMV? Demystifying Wholesale Real Estate Investing

When you are wholesaling real estate, you need to understand how to successfully calculated After Repair Value (ARV) and Fair Market Value (FMV).  These  numbers help real estate investors determine what to offer for a property, making sure there is enough room in the deal to make a nice profit.   If you do not accurately calculate these numbers, you will be either paying too much or submit low offers that are not going to be accepted.  These numbers are crucial to successfully wholesaling real estate. 

After Repair Value (ARV) and Fair Market Value (FMV) mean essentially the same thing to real estate investors. They can be defined as the current value for a particular property in a given location at a particular moment in pristine condition.  There are a few slight variations in each of these values. 

Fair Market Value will usually use comparables that are a mixture of short sales, foreclosures, and regular properties that have sold within the last 3-6 months in that same area.  In most cases, it will give you a conservative value determination for the subject property, so you can see how much it is worth today in its current condition.  The fact is that a majority of the wholesale properties that we will be looking at will need repairs.  If we use a mixture of different property conditions in the same area, we will have a clearer picture of what the value would be for that property right now.  Many of the foreclosures and short sales will need repairs, thus they will be great comparables for our wholesale deal.  

After Repair Value could be used to determine the value for our wholesale real estate deal in pristine condition or at least after it has been repaired.  The comparables that we will use  will need to be regular homes (non foreclosure or short sale) for sale that were in better condition.  Essentially, we are looking for comparables that need little to no repairs at the time they sold, thus they produce a truer value for the property in good condition in that area. 

Fair Market Value and After Repair Value are very similar, but there are a few differences to note.  You will want to make sure you have your real estate agent pull the right comparables for you.  The agent remarks section will help you determine if you have the right comparables as well as whether the financing notes FHA or not.  The agent remarks or comments section of the MLS listing for that sold property will give details on the needed repairs or current property condition.  The financing section will normally not state FHA financing as an option to purchase if it needs some more serious repairs, unless it was the listings agents mistake. 

If you are going to wholesale a deal, most of your cash buyers, rehabbers, wholesale buyers, and real estate investors will want to know the value of the property after repairs, so they can see how much room is built into the deal that you negotiated.  If they like the numbers and see the opportunity to make a great end profit on it, they will be interested in that wholesale deal.  After Repair Value is the most common value that you would calcuate and offer to your cash buyers.  They will normally want to know this amount when you send over the numbers for your deal before you bird dog or assign a deal to them.   

 

June 23, 2011 / by / in ,
Fastest Way to Build a Cash Buyers List – Sure Fire Technique
Build a Buyers List FAST

Build a Buyers List FAST

Many new real estate investors or seasoned investors entering a new market struggle to build a cash buyers list to flip wholesale real estate deals.  It is absolutely crucial for any property finders or real estate bird dogs to build a cash buyers list as quickly as they can, so they can start making money on their wholesale  real estate deals.  There are a lot of different techniques you can use to start building a cash buyers list, but one technique will help you build your cash buyers list faster than the rest. 

Before we discuss this technique, we need to identify the keywords that all real estate investors/ cash buyers will use to market their business.  Many of the real estate investors/cash buyers we focus on will be marketing to find motivated sellers, advertise properties they are offering lease options or seller financing on, properties they are looking to rent or properties they are looking to wholesale.  Here are some of the keywords that they will most commonly used in their advertisements. 

Motivated Sellers: We Buy Houses, Cash for Houses, Behind on Payments, Avoid Foreclosure, Stop Foreclosure, Cash Offers

Seller Financing to buyers:  Financing Available, No Banks Needed, Owner Will Carry, Seller Financing, Bad Credit Okay, No Credit Okay, No Credit No Problem, Bad Credit No Problem

Lease Option to buyers:  Lease Option, Rent to Own, Lease to Purchase, Financing Available, No Banks Needed, Bad Credit Okay, No Credit Okay, No Credit No Problem, Bad Credit No Problem

Selling Wholesale Properties: Wholesale Real Estate, Wholesale Properties, Discount Real Estate, Discount Properties, Cheap Houses, Cash Buyers, Investment Properties, Income Property, Fixer Upper, Handyman Special, TLC Needed

A combination of these keywords can be placed in a search engine (Google, Bing, Yahoo) to bring back results for cash buyers/real estate investors.  In order to narrow down the results you might try doing your search by putting quotes around the keywords listed above and then an addition sign in between and the quotes around the location you are trying to find cash buyers. An example of this for Tampa, Florida would look like this “we buy houses” + ” Tampa, FL” .  It will help drill down the results so you are only looking at leads that are in your local area.

One word of warning, there are many nationwide organizations that may show up in these search results.  If you do not see that they have a local office location or a local phone number then you know they are a nation wide organization.  The results will be a combination of blogs, websites, classified ads, online videos, newspaper ads, social network postings and discussion forum threads.  You might find that one cash buyer is posting their informaiton in a variety of different locations, so you will want to be aware of this fact.  It is in your best interest to track the contact information for each of the cash buyers you find, so you can follow up with them. 

It is always best to capture a phone number, so we can be proactive and give them a call right away.  We will be able to qualify and confirm that they are a good cash buyer.  You will want to qualify them.  Make sure you have a clear understanding of what they are looking to invest in, so you can start looking for wholesale deals that meet their criteria.  It will enable you to make money as a real estate bird dog or property finder that much sooner. 

 

June 23, 2011 / by / in , , ,
Finding Motivated Sellers in Less Conventional Ways – Great Sources for Wholesale Properties
Finding Motivated Sellers with Properties You Can Wholesale

Finding Motivated Sellers

There are many different ways to find motivated sellers.  Some approaches are better than others.  I will focus on a less known approach to finding motivated sellers.  In most areas, you can gain access to a large variety of motivated sellers found in the local courthouse.  Here are a few ways you can find these leads:

  • Delinquent taxes in the tax assessors office or tax liens filed against properties in the recorder, county clerk, or register of deeds
  • Eviction filings in the circuit court
  • Code violations in the recorders, county clerk, or register of deeds office & check with housing & code department or fire marshall for city/county to see if any current outstanding code violations
  • Unclaimed property with the state treasury department
  • Probate filings in the county circuit court
  • Divorce decree filings in the county circuit court

Some areas are going to be more difficult to acquire information than others.  For instance, divorce decrees, probate filings, and eviction filings are harder to acquire in my area than the rest of the other approaches.  I have to pay to access a circuit court database, search in a particular way, and then request in person certain files from the county courthouse.  I can only request a certain number at a time and I have to wait for the original to be sent to my local county office from the main office in the capital of the state.  Yes, I know, it can seem like jumping through hoops.  It is and there are easier ways to find motivated sellers in my area, so I use those.  However, I have found other areas to offer this information in a more accessible format.  I would recommend poking around and asking questions in your local courthouse to see what is available in your given area to access the easiest information available.  You will be pleasantly surprised.  Many years ago, I found out that a childhood friend’s father recently became the fire marshall for the  city I was buying property in.  He became a great source for properties that were in violation of local codes.  I have become great friends with the county tax assessors office.  The clerks in the office know who is grossly delinquent on their taxes and who the big investors are in the county too.  It is amazing how a few questions, some donuts, and some kindness can give you an extra added advantage over your competition for finding motivated sellers. 

 

June 23, 2011 / by / in ,