How to Find Short Sale Leads
"Pre" Notice of Default
There is a process of foreclosure in every state. They're not all the same, either. It's your responsibility to find out the system in your state and know the laws. There are certain things that do occur before any property is sold at the forelcosure steps. Do you know what it is? It's easy! The homeowner starts to get behind on their payments.
You Can Get a List of People Who Are Behind on their Mortgage Payments
This is called the PRE notice of default. It's a list that is generated from the credit bureaus each month. The information that is delivered to you on these lists are accurate and an excellent way to generate some short sale leads. I don't want you to mistake the Pre NOD list with a "pre foreclosure" list. They're not the same thing. A preforeclosure list is a list of people who have already had legal action taken against them by the bank. Once that happens, it becomes public record and everyone knows about it. It's an even battle field at that point. Pre-NOD leads are NOT publc record. In fact, they are people who have only started to get behind on their mortgage payments. Wouldn't you like to get your hands on people like this? You can start to build a relationship with them and you will be their problem solver when the time comes.
Where does this information come from?
This information is reported by the credit bureaus. They report the status of the loans every 3 weeks.
What To Do With the List of Leads
When you pair the pre nod leads up with a high response marketing plan, you're business will sky rocket instantly. Real estate entepreneurs are constantly looking for new ways to generate leads. By using a proven and effective method for generating leads, there's literally no way to lose. Handwritten marketing has been tested and tracked to be proven for over 4 years, more commonly known as the "yellow letter". You can expect to receive a 5% to 10% reponse rate when you implement yellow letters and pre nod leads together to generate short sale leads.
These are the ugly looking signs that you see on the side of the road. They usually measure 18 x 24" and are on wire stakes. Again, this is something that you might want to research in your area as far as the laws that pertain to placing signs. For the most part, they're a "no-no", but people put them out anyway. The sign ordinance pertains to ANY sign, including For Sale By Owner signs, Realtor's Open House signs, Garage Sale signs, or any sign that is placed on city property. So don't think that the sign pertains only to real estate investors. It doesn't.
Bandit signs are affordable, and they generate some good leads. Don't expect your signs to stay on the streets for long. Realtistically they'll last 1 to 5 days (5 if you're lucky). You can give them some extra life by stapling them to a telephone pole or a tree up higher than the average percan can reach. There's a great tool for getting the sign up really high called The Sign Stapler. You might want to check that out - it's worth the investment if you plan on doing bandit signs.
If you have some real "kahunas", you can make a fortune by knocking on the doors of people who are behind on their payments and facing foreclosure. I've been in the real estate business for 10 years, and I've only met 3 or 4 people that have the nerve to go out and make it happen face to face. While I admit it can be a little intimidating to think about knocking on someone's door and discussing a somewhat "touchy" area, you'll be surprised to find that they're happy to see someone at their door with solutions. It's also hard to say "No" to someone in person.
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