Six Steps For A Successful Real Estate Entrepreneur!
Our Six Steps training process is designed to get you prepared for “Beyond” the House Finders Program. Once you become an expert at the processes below, you will typically be prepared to begin your Wholesaling journey. You’ll have a lot of questions and obstacles to overcome in the Wholesaling process and as you run across them, jot them down and send us a quick email. We are here to help answer your questions and provide support. Always refer back to this training page or go to our Quick Resource page for help.
Step 1 – The Right Properties for Woot (and probably most investors in the Colorado Springs area)
- Our Criteria
- Located in (719, 720, 303 area codes – except Pueblo) Denver, Castle Rock, Colorado Springs, Fountain, Security, Widefield, Manitou Springs, Peyton, Falcon, Black Forest, Monument and throughout El Paso County.
- Distressed Junky “Houses” (this means NOT move-in ready) typically in need of a good deal of repair or cleanup (no Modular or Mobile homes)
- OR Motivated Seller (meaning they are in financial distress – going through a divorce, bankruptcy, probate, lost job, need to move quick)
- Single family houses
- Not listed on the MLS
- Blue-collar neighborhoods where the majority of homes are 20 years old or older
- Our ideal property is 3 to 5 bedrooms, 2 baths, 1 or 2 car garage
- No busy streets like Union Blvd (an exception would be the Old North End neighborhood and around Downtown)
If you have a property in mind, but it doesn’t exactly fit our ideal specifications, that’s fine! Deals come in all shapes and sizes, so submit it to us anyway and we’ll do what we can.
- Motivated Home Sellers
For us to turn a property lead into a successful purchase, we need to be dealing with a highly motivated home seller. This is the key principle that will determine your level of success as a property locator/house finder.
We can only work with property owners whose number one goal in life right now is to sell their piece of property. They are often dealing with a time-sensitive circumstance, as well as financial and emotional stress.
Some examples of these situations are:
1) They’re having difficulty making their mortgage payments: This is a big reason people may need to sell. While finding these people isn’t obvious, some indicators are delinquent taxes, bankruptcy, and houses in great disrepair. What happens if they continue to not make their payments? The bank forecloses, they lose their home, and they’re thrown into a world of financial trouble. Their best option may be to sell and sell fast.
2) They’ve inherited a home they do not want or cannot afford: Often the best solution for heirs of an estate that contains property is to liquidate the property quickly. This is simply because cash could help them more than suddenly owning an extra house.
3) They’ve recently divorced and want to sell: No one plans on getting a divorce but, unfortunately, situations can change. Often, the house becomes the responsibility of one individual who cannot make the payments by him/herself.
4) They’re moving and need to sell fast: Work or family situations cause people to have to move in a hurry. In this case, selling quickly is usually essential.
5) Their house simply won’t sell: Many sellers see their houses sit week after week, month after month on the market with little interest. When their agreement expires with their listing agent, they’re forced to figure out what to do next. Just listing it again is a costly and poor decision.
6) They’re tired landlords: Many landlords who have dealt with a series of problem tenants are simply fed up with the headaches and ready to sell their properties.
7) They own a vacant house: Houses can be vacant for many reasons, and we’ve found that owners of these houses are often willing to negotiate a sale.
The very best lead you could submit is one where the owner is in one of the above categories, has a lot of equity in the property (equity is the difference between the market value of the property and the amount the owner owes on his/her mortgage), and needs to sell right away.
For people in situations such as these, we are the fastest, easiest solution, and they’ll thank you and us for helping them out!
- Finding Motivated Sellers
You may already know of friends, family members, or co-workers who we could help. Great! Let us know today! But because we all have a limited number of direct contacts, we have to do some work to find other property leads.
This work is going to take some time and requires marketing – and we’ll provide a number of real estate marketing options to choose from. Without marketing (i.e. getting the word out), no one will know that we’re here to help!
Step 2 – Marketing for Properties
- Marketing Strategies
The fact is that there are a lot of highly motivated sellers out there, but they just don’t know whom to call. So we have two options:
1. We can try to track these people down
2. We can let them find us
Both strategies work, but it’s generally easier to let motivated sellers find us than for us to track them down. And how do they find us? MARKETING!
NOTE: We/you only want to deal directly with homeowners. If a property is listed with a real estate agent (usually a realty sign in the yard or window), please ignore the house. They are working hard for their money, so we don’t want to step on any toes.
As a new Wholesaler, begin by selecting options below that are free or very cost-effective. You probably don’t want to spend your hard-earned money on marketing for us, at least in the beginning until you learn the ropes.
– Flyers –
These are a fantastic (and inexpensive) ways to spread the word. Here are links to our marketing flyer that you can print.
Flyer – No Phone Number (write in your phone number)
Ebay Flyer (example – perfect for store bulletin boards)
We suggest using Google Voice for a free phone number and voice mail that you can forward to your home phone or mobile. Feel free to print out as many flyers as you’d like. Hand them out to neighbors, post to public bulletin boards, drop them off at laundromats, bus stops, coffee shops, etc.
Have fun with it and be creative! See a distressed house, tape a flyert to the door or put it under the door mat. Just be wise about how you distribute your flyer and don’t put them in mail boxes because that is illegal.
– Business Cards –
These you can pass out to everyone you meet, leave them at restaurants, put them in your bills that you send off when you pay them, etc. Try setting a goal of handing out 5 business cards per day.
Design and print your own business cards or use a service like www.vistaprint.com (they provide free cards.) The message on the card should be similar to the message on the flyer. It’s basically your flyer in pocket form.
Get really creative with business cards and try www.DollarCardMarketing.com, these will really grab attention.
Remember that all it takes is one card to make you $500 or More!
– Bandit Signs –
You’ve probably seen them driving down the road. Those little signs (aka Bandit Signs) are proven, in certain markets, to be one of the TOP all time best ways to attract motivated Sellers. They are the ones that say something like “WE BUY HOUSES,” “STOP FORECLOSURE” or “SELL YOUR HOUSE.” People say these signs work very well, we’ve spent a lot of money on them and haven’t seen great results in Colorado Springs or Denver. They cost around $2 each depending on where you buy them and how many you buy.
Many online sites require a minimum amount (50 or 100), so you can check with local sign shops if you want less. Here’s a link to one of the cheapest places for Bandit Signs.
The most effective signs are 18” x 24” plastic corrugated. You want a simple message such as “WE BUY HOUSES” or “SELL YOUR HOUSE FAST” and a phone number.
They should have white or bright colored background and dark lettering. Make sure the phone number is big enough that people can read it as they drive by (for more room on the sign leave the area code off, people know we’re in “the 719”). Signs produce the best results when placed near intersections where people have to slow down or stop. Stay away from manicured grass (as a lot of mowing occurs and your signs will be removed fast).
To be more cost-effective, we suggest handwritten signs on leftover cardboard. Same message applies, neatly cut the cardboard and clearly write “We Buy Houses” or “Sell Your Problem House – FAST!” & your phone number. To be more personal, put your name on them or a nickname (example: “Joe Buys Junky Houses”). Nail them to telephone polls (up high) for best response and longest life span. These are also basically FREE….. You can find good cardboard in the dumpsters behind Home Depot & Lowes and you just need to buy the fattest, biggest black marker you can find.
*Your town may have ordinances against these signs. Highways and medians are off limits in most cities (check local sign ordinances). The last we checked, Colorado Springs and Denver areas allow signs from noon on Friday to noon on Monday. These restrictions are mostly likely the cause for lackluster results.
– Print Ads –
These are the ads that you see in the local newspaper classifieds. You could purchase a series of ads that run every weekend. You should check with local penny savers and church newspapers as well, they are usually cheaper and can provide you enough exposure to get calls. Here is an example of an effective ad:
WE BUY HOUSES CASH STOP FORECLOSURE 555-555-5555
I’LL BUY YOUR HOUSE TODAY! CA$H! 555-555-5555
– Internet Scanning and Posting Free Classified Ads –
You can post ads on classified Websites such as www.craigslist.org, www.EbayClassified.com, www.FSBO.com, and www.backpage.com and www.myhousedeals.com. You can also scan the online ads and look for motivated sellers posting their houses for sale – give them a call or respond via email. Look for keywords such as motivated, must sell, and FSBO.
– Newspaper Scanning –
Take a few minutes to scan the houses for sale. Again, look for keywords like motivated, must sell, and FSBO.
– Direct Mail –
We send letters to homeowners in target neighborhoods, pre-foreclosure, bankruptcy, property tax delinquency, and other situations. We get tremendous response from our mailers. Sending mail simply requires:
Pulling a list from a trusted online source, Cleaning the list based on our criteria, Merging the list with our pre-written letters, Folding, stuffing, addressing, stamping, and sending the letters
If you’re interested in sending direct mail, simply contact us. We’ll provide you some additional ideas and pre-written marketing letters. Or create your own direct mail list by driving around collecting addresses and then mailing them a postcard you create or your ‘flyer.’ He have plenty of examples for you, just let us know.
– Door Hangers –
This is a great strategy that gets strong response simply because homeowners cannot miss them. Door hangers can be purchased from www.doorhangers.com.
You’ll want two-sided hangers, preferably in color. The front should be vivid and attention-grabbing with a brief headline. The back should provide all the details about who and how we can help, along with contact information. Again, use the above flyers as a template for the information on your hangers.
The perfect time to distribute door hangers is mid-day when most people are at work. You may want to use a map to keep track of the areas you have covered. Be sure to take note of the ideal neighborhood and property profile described above.
– Driving for Dollars –
Do you know of any vacant or “distressed” homes in the area? Simply write down the address and a brief description of the home, snap a quick photo. Stay away from houses already listed on the MSL – look for realty signs.
Do you drive the same route to work every day? Try alternative routes and stay on the lookout for houses that match our ideal property profile! Some common symptoms are overgrown yards, rusted cars in the yard, For Sale By Owner -FSBO signs, broken windows, boarded up windows, no drapes, etc. We like houses with really worn out roofs, it’s a perfect sign of distress!
If ALL the properties in the area exhibit the above symptoms, it’s not a good sign. But if it’s a single house surrounded by several decent houses, you may be looking at a deal. The common rule in real estate is to find “the worst house in the best neighborhood.”
How about garage sales? These happen almost every weekend in the summer and often signify that the homeowner is moving. Simply stopping by and asking if they’ll be selling their house – or if they know of any neighbors who may be interested in doing so – can result in some solid leads.
As you can see, there are a number of marketing options available, and there’s an option for every budget and time commitment. The important thing to keep in mind with each of these strategies is that you’re not spending time and money; you’re investing it with strong potential for great return.
We want you to be successful, and we’ll equip you as best we can with the tools and strategies to do so!
Step 3 – Locating The Owner
• Talk to neighbors around the house and leave your business card.
• Check the county appraisal district website for tax mailing address
• Send a letter (a simple “My name is and I am interested in purchasing your house at Address, please call me at Phone Number.”) Then put “Do Not Forward, Address Service Requested” on the bottom of envelope or postcard and mail it. If the post office makes a mistake and forwards it, then perhaps the homeowner will call you. Otherwise, the postcard/letter should be returned to you with the new address on it.
• Skip trace services. www.findtheseller.com
There are many, many other ways to locate motivated sellers. The key is to get creative!
- What Do I Say to the Homeowners?
All you need to say is that you are associated with a group of strong, experienced home- buying specialists who pay CASH and can close QUICKLY, and that you may be able to help them with their problem. Let them know you will need to gather some quick information for your partner and that we will be in touch.
Seller Questionnaire/Lead Sheet – Here is our Seller Questionnaire/Lead Sheet that is designed to be used anytime you are speaking with a potential seller and gathering information.
First ask leading questions that will allow the seller to answer most of the questions on the sheet for you. An example would be, “can you tell me a little about the house you are selling?” You will find that the seller will most likely speak about the number of bedrooms and bathrooms, talk about the plumbing and lot size, etc..
The next set of questions is for gathering information to see if the seller is flexible in the terms of selling their house. This is important to know because there are many types of creative financing to work out a deal with the sellers.
Get financial information – how much is owed on the loan, is it free and clear, is the seller behind on their mortgage payments. It also indicates the level of motivation a seller has for selling their house. If they need to really sell quickly, they will tell you anything you want to know about their house, finances and a lot of their personal lives too.
If a seller is not willing to release information to you, don’t sweat it, just understand that they are probably not motivated enough for this to be a quality lead, yet. It may TURN INTO ONE, so ask the homeowner if it’s okay to follow up with them in a couple of weeks and then do so.
The more motivated the seller is, the more likely you have a chance to get the deal closed, and money in your pocket.
How do I know a seller is motivated? There is a HUGE difference between someone who really wants to sell their house and a person who needs to sell their house. Don’t confuse the two. You are really not looking for people that really want to sell their house! The seller call script we provided will elicit the answers you need to gauge the seller’s motivation level. Some of the ‘motivation flushing questions’ are:
• How long has been trying to sell your home? (The longer the time the more motivated they may be)
• If you don’t mind, may I ask you why you are selling? (Look for answers like “I have been relocated,” or “I purchased a new home and we are closing on it in two weeks,” or “I am behind on my mortgage payments and need to sell.”)
• When do you need to sell by? (If they answer that they have no dead line and are just feeling out the market they are NOT motivated and you can move on!)
• Why do you think it hasn’t sold yet?
Other questions you can ask – Gauge motivation
• What are your plans if you can’t sell your house?
• What is more important to you, getting a quick sale or getting top price?
Keep your calls very conversational. When people call you they are usually more willing to provide information.
Step 4 – Properties to Stay Away From
Save yourself some time, we have come up with a few things to stay away from while out locating properties:
Foreclosure Subscription Lists – Do not pursue properties from foreclosure subscription lists, which investor obtain independently. An exception to this might be if you took the initiative to directly contact the owners and determine that they are highly motivated to sell their house at a discount.
Realtor-listed Properties — We have found that MLS properties do not yield the best results, unless the property is priced significantly below fair market value. In addition, the commissions and fees reduce the available equity that the homeowner is able or willing to share.
Investor Properties — You want to speak with the actual property owner, not other investors looking to quickly wholesale properties. One exception are disgruntled landlords just looking to get out of the business. Just assume that 90% of the stuff on craigslist under FSBO is listed by investors and not actual motivated sellers!!
War Zones — Avoid properties in dangerous, crime-ridden neighborhoods where the majority of the homes are vacant and abandoned. Although we are typically interested in vacant properties, ‘war zone’ homes have less appeal, and are generally less marketable, especially if there are too many other vacant homes in close proximity. Use your judgment in considering whether the average person or family would want to live there. Also, think about your safety!
Step 5 – Submitting Wholesale Deals
** This is the important part ** Let us know about great Wholesale Deals you’ve put under contract.
Submit your Wholesale deal to us directly at WholesaleDeals@WootInvestments.com.
- Unsuccessful Deals
For various reasons, we do not move forward on every opportunity you might bring us. In these cases, either the price didn’t meet our terms or the criteria of the house wasn’t right for us. It happens, don’t ever get discouraged! We truly apprecaite you!
We want you to be incredibly successful, so just keep learning and submitting those Wholesale Deals. Remember that the more deals you find, the greater your chance of success.
Step 6 – Get Started
This guide should have provided you with a lot of detail to get you started as a Wholesaler right away. The biggest threat to your success at this point is “analysis paralysis,” or overanalyzing to the point where you don’t take any action.
Wholesaling is a simple opportunity with potential for extraordinary financial reward. It’s low-risk way to learn a little bit about real estate investing. And, most of all, it should be fun!
If there’s anything we can clarify and help get you on your way, please contact us by email at Contact@WootInvestments.com or call us at 719-360-3400.
We look forward to teaming with you to help better our community through real estate solutions & we wish you success!
The Woot Team
WOOT – (WuT). Celebratory exclamation and expression of accomplishment and gratitude