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4 Crucial Details Not to Overlook When Talking to Motivated Sellers

All successful real estate investors share a common trait: they’re sticklers when it comes to the details. They know which facts and statistics will matter in the long run and adjust their investment strategies accordingly. Never is this more critical than when you are talking to motivated sellers.

Taking a page out of their book could help those new to the real estate industry shorten the notoriously steep learning curve. But what numbers are important to focus on? In today’s technologically advanced society, there’s a plethora of data on virtually every property readily available. It can be easy for inexperienced investors to quickly get buried in the avalanche of numbers a quick internet search will return.

To help avoid this, here’s a quick overview of the four details that successful real estate investors always learn before meeting with a potential motivated property seller. Some of these items are easier to to find than others, but the return on investment will be well worth it.

Physical Property Details

Do your homework—it pays to be prepared in the real estate business. Investors should be aware of what they’re putting their hard-earned money towards, whether it’s the square footage of a commercial warehouse or the number of functional units in a multi-family property. Investors shouldn’t open their negotiation with sellers by asking about basic facts that are easily obtainable to the public. Doing so signals the other side that you’re unprepared or that the property is low on your list of priorities. These basic—albeit important—stats can be garnered from various free resources including; county appraisal district webpages, title companies, insurance databases, the Realtors Property Resource (RPR) database, or other data aggregators that pull specifics from multiple credible sources.

Financial Specifics

Is there a pre-existing mortgage on the property? Which party possesses the real estate note? How much is the month-to-month bill? What’s the interest rate? How far along is the property in its amortization timeline?

All of the above (and several other key finance issues) are essential when it comes to determining whether you’re going to make a substantial investment of time and money into a property. To be considered a worthwhile opportunity, the property needs to have equity—and determining whether or not it does is largely based off these financial data points.

How do you locate this information? The ideal place to start is either the county deed records office or the financial institution that made the loan. In some scenarios, however, a list vendor will enable potential investors to sort potential properties based on the total estimated equity. Certain data aggregators such as PropertyRadar or ListSource also have the ability to provide this data, which can be useful when meeting with motivated sellers.

Seller Background Check

Who’s selling the property? What’s their occupation? Who’s their employer? What’s their annual income?

Not many real estate investors dedicate the time and effort to find out these details, but if you are able to, the payoff can be substantial. The more knowledge you have, the more you will be able to effectively customize your marketing approach to match your seller’s unique profile.

This type of information is typically only available via certain demographic databases that require a subscription or charge a minimal fee. Try to find a product that pairs the demographic points you are targeting and the owner’s name. This can be really helpful once you start negotiating with motivated sellers.

Owner Contact Info

This one’s pretty straightforward. At a minimum, you’ll want to have the phone numbers and email addresses of the owners involved in the transaction. Obtaining this information is easy enough using a method referred to as “skip tracing.” While there are numerous vendors that offer property skip tracing services, many of them are sub-par when it comes to providing quality, usable information. It’s advisable to be prepared to pay a slightly higher price up front than to end up with a bunch of useless data.

If you are looking for further guidance on how to best prepare for meeting with motivated sellers, then don’t hesitate to contact Alta Capital Group. Our team has the experience, the knowledge, and the sound business instincts to help you make the most of your real estate investments. Give us a call to learn about the Alta Advantage, and see why the majority of our clients come back for repeat business. (844) 402-2582