What Is a Pre-foreclosure and How Can It Help Me as a Real Estate Investor?
Homeowners in pre-foreclosure are one type of motivated seller to focus on as a real estate investor. The pre-foreclosure stage is where a property is in danger of being foreclosed on and the owner has likely already defaulted on several payments.
If a property owner is having difficulty affording their home, they are more likely to need the hcelp of a real estate investor. These motivated sellers are a demographic you should focus on if you want to close profitable real estate investment deals.
How Do I Find Pre-foreclosures?
There are several ways to find homeowners that are in foreclosure or pre-foreclosure.
1. List providers
There are two lists available to find motivated sellers facing foreclosure, local list providers and national list providers. The local list provider will probably have more up-to-date information than lists provided by national list providers.
You can find a list by searching for list providers in the city you are targeting. For example, do a google search for list providers for Dade County in Florida. These lists will cost money.
2. Network with local real estate professionals
You can also find potential foreclosures by contacting local real estate investing clubs, title companies, and real estate agents. Let them know that If they give you a heads up about upcoming foreclosures, you will let them know if you come across a seller that would benefit from working with them. It is a win-win for both of you.
3. Do your own research
A list provider and networking can save you time. Doing your own search for motivated sellers can also provide helpful information. There are several ways to do your own search. For example, you can visit your county recorders offices and sometimes banks even list their defaulted loans online.
What Can I Do When I Find a Homeowner in Pre-foreclosure?
Once you find homeowners facing foreclosure, you need to market to them about how you can help. There are several ways to do this.
- Cold calling – tried and true cold calling on the phone is always one way to reach motivated sellers. Have a script ready before you make the call and be prepared to answer any questions they might have.
- Direct mail – a direct mail campaign can be very effective in getting the attention of sellers facing financial trouble. It might require several mailings. Everyone responds to different types of marketing and so it is important to mix it up. For example, you can do postcards with large catchy words. You can also send professional looking letters explaining how you can help and inviting motivated sellers to contact you.
- Local signs – you have probably seen signs around your city saying “we buy houses”. These signs do work and can grab the attention of someone facing foreclosure. Keep it simple with just a quick phrase and a phone number to contact you.
A common misconception is that you can only become a real estate investor if you have access to large amounts of money. However, there are ways to invest in real estate without using any of your own money and even if you have poor credit. One step is to market to these sellers in pre-foreclosure.
To learn more about the same methods that have made me millions, you can visit my free Investor Kit online and get started today.