Mother’s Day is easily one of the most important days of the year. We wouldn’t be here without mothers. Wholesaling real estate is also important. It can empower women to achieve more of what they want, and is a powerful tool for taking care of the moms in our lives.

Buying & Selling Real Estate

There are a lot of mothers out there who need a break. Some really need a good ethical wholesaler to give them access to a real deal on a home. Others need access to quality real estate investment opportunities. Many still need a solution to exit a bad situation and the burden of a property that isn’t helping them. Wholesalers can really help in this space.

Wholesaling Real Estate For Mom’s

Wholesaling real estate is a great way to get ahead financially, give your kids the life you want, have the free time to do life with them, and have the time and surplus money to treat yourself to those shopping sprees and spa days that you really need and deserve.

This makes this Mother’s Day a great day to commit to getting started in wholesaling real estate. If you know a mother who could really benefit from doing this, then perhaps gifting her a book on real estate wholesaling or paying for her to attend a course is the best gift you can give her this year. One that will go on giving for a lifetime and generations.

Using Wholesaling to Fund Your Mother’s Day Gifts

Wholesaling houses is an awesome way to make cash fast. It can be used to raise the money you need to give moms awesome gifts. It can be a tool to find and give the gift of real estate. Maybe there are partners, spouses, daughters or parents in your life that could really use  a new condo, income property, or a space in your own assisted living facility.

Taking Time for the Moms in Your Life

Aside from the money, the great thing about wholesaling is the freedom to take special days off, like Mother’s Day. Spend it with your moms, grandmothers, daughters that will be future moms, and neighbors who are moms.

Remember that you don’t need any more cash than you have now to start wholesaling more real estate, if you use transactional funding.

 

The perfect home buyer app that lets you record notes and pictures as you tour a property. Review and share your reports with others from your Android, iOS device or computer.

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We were recently interviewed by Vena Jones-Cox on WMKV 89.3FM (Cincinnati, OH) on Transactional Funding Fundamentals.  It is also on the archives of Vena's website, RealLifeRealEstate.com.

Check out this informative and insightful radio interview:  http://tinyurl.com/BTFonRadio

What is the current state of the wholesaling market?  What are hedge funds doing now?  Will there be more inventory coming?  How should wholesaling strategies be used?

Find out the answers to these questions and more with our guest, Vena Jones-Cox, the Real Estate Goddess...

Some local municipalities around the country have declared "wholesaling" real estate as illegal.  They contend that selling houses without owning it first is a violation of the law and may require a license.

Not so fast...

 

PS: Apologies for the audio in advance.  As always, we try to give you the best content we can to help your business.  In case the audio is not clear, our guests are Maurice A. Thompson, the Executive Director of 1851 Center for Constitutional Law, and Vena Jones-Cox, aka the Real Estate Goddess.  Maurice's website is ohioconstitution.org and Vena's website is regoddess.com.

Case Study of HUD same-day, back-to-back transaction with BestTransactionFunding.com

Using BestTransactionFunding.com Transactional Funding for HUD Transactions

Investor explains how transactional funding can be used by flippers

BestTransactionFunding.com featured on CNBC

How can you take you’re your real estate wholesaling business from 0-60 in the next 60 days?

Regardless of whether you are just starting out flipping houses, are consistently turning over 4 houses a month or are churning out 100 wholesale deals a month there is plenty of room to grow. There has never been a better time to crank it up either.

The Time is Ripe

This is the time to do it. The stars are perfectly aligned for increasing volume and upping your real estate investment business’ position in the market with the optimal combination of trends in play. Demand and confidence are up, the timing in the housing cycle is ideal and there is plenty of distressed inventory, twined with rising home prices. The time to position yourself and your wholesaling business to reap the maximum rewards is now; ahead of expected surge in summer activity and influx of international capital.

So how do you take it to the next level quickly?

What does it require to double or triple the number of homes you are flipping each month? You’ll need more property inventory, more home buyers, more funding to make sure acquisitions aren’t hampered and streamlined systems.

Tips for Lining Up More Inventory in a Hot Market

It’s no secret that as the market is heating up, so is the competition over homes in many markets. So avoid the mayhem, avoid the stress and overpaying by leapfrogging the competition to find high volumes of deals.

Look to:

• Non-performing mortgage notes
• Construction REOs
• Tap into mounting shadow inventory with bank contacts
• Build an extensive referral partner network for tapping into off market properties

Grow your referral network quickly by using social media and organizing your own networking events and go beyond Realtors and loan officers to bank managers, attorneys, insurance agents, financial planners and counselors.

Tips for Attracting More Buyers in Bulk

Everyone in the world would like to own a slice of American real estate today, it’s just a matter of making sure they come to you, and not the competition.

So how to you lock them in fast and in large numbers?

• Tap into the social networks of online influencers
• Collaborate on marketing efforts with local business owners
• Market to the targeted databases of subscribers magazines and blogs control
• Reach out to foreign affiliates through chambers of commerce and Realtor groups
• Launch a robust Google Adwords campaign for all the traffic and leads you can handle on demand

Tips for Finding More Funding

Having all the buyers and sellers in the world is great but even the most affluent investors need to stay liquid and will want to use leverage to ensure that they can capitalize on all of the opportunities available.

Conventional bank loans just won’t work for this strategy and the speed at which you need to operate.

Instead look for funding via:

• Commercial mortgage lenders for bridge and blanket loans
• Transactional funding through firms like Best Transaction Funding
• Business loans
• Private lenders through brokers or networking

The Key to Success…

Take the time to stop and systemize and automate everything now. Take a week off if you need to, or hire an assistant to do it. You simply can’t afford hiccups to derail your momentum later, or a lack of capacity to hold you back. Not having deals is one thing, but worse is having the above 3 factors lined up, and not being able to handle the deal flow.

How can investors find more viable inventory in today’s hot real estate market?

Declining housing inventory levels may be providing a nice boost to home values across the U.S. but this is also making it seem harder for some investors to line up as many deals as they would like.

Publicly available housing inventory levels are now way beyond what is required for a normal, healthy and balanced real estate market. At the same time the situation is being compounded by a dramatic increase in competition in the industry as more Realtors and investors jump into the game of hunting home sellers.

To come out on top in the midst of the current fierce bidding wars over homes for sale those wholesaling homes can use transactional funding to make cash offers and close quickly, even if they don’t have great credit.

Still it is smart to find more ways to uncover deals and navigate around the competition to get better discounts too. This can include tapping into non-performing mortgage notes versus REOs, or looking to niches like marketing for probate properties and building relationships for access to the rising number of pocket listings.

Still, ambitious real estate investors can feel that they are falling short of their volume and income potential. So what’s the solution?

Those that want substantial amounts of leads and need them to flow in predictably or at least on demand can turn to pay for performance marketing in the form of third party telemarketing through outsourced call centers or PPC advertising via Google Adwords.

For those that are on ultra-tight budgets or hate writing checks for marketing regardless of the guarantee of real leads or ROI taking a guerilla marketing approach can still work well.

This doesn’t have to mean substandard results either. Hot cloud storage service DropBox is pure proof of this. DropBox launched during some of the toughest times for small businesses, went live amid a maze of other competitors, and at a time no one saw the value of cloud storage, or cared about having it. Still, they managed to accumulate many users even before going live, then rocketed to millions of customers with 18 months by focusing on word of mouth referrals and viral campaigns.

These are all tactics that can be adapted for hunting down or attracting distressed sellers for bagging more discounted deals for wholesaling homes. The potential is huge, if you really have the determination.

Is using transactional funding the only solution for escaping jail when wholesaling real estate today?

Despite single handedly bringing back the housing market and economy real estate investors are now being criminalized for recycling homes and aiding in the revitalization of neighborhoods across the U.S.

Investors around the country have been receiving notices that they are committing felonies when wholesaling homes. Investigators and the feds are picking up on their advertising, while jealous real estate agents, competing investors and even disgruntled home buyers and sellers are turning them in at a higher rate than ever before.

So what’s the problem? Will all investors be regulated into being felons and jailed by 2014?

Not all, but those flipping and wholesaling homes as well as some buy and hold investors could find themselves increasingly regulated and forced to adopt new strategies and business models or face some time behind bars.

For those that haven’t had the pleasure of getting to know the U.S. justice system yet, a felony means long stints in real big boy prison after a nice vacation in the hardcore level of the local county jail. Not a place many want to find themselves.

The main issue surrounds unlicensed real estate sales activity and advertising, both of which are currently under the spotlight of the IRS, FTC and other agencies and attorney generals.

Those marketing homes that they don’t own and have not closed on yet or when involved in chains of marketing for other investors is what is causing the most problems. Obviously this includes the strategy of a massive percentage of wholesalers out there today. So what’s the solution?

Fortunately there are several work-arounds including:

• Obtaining a real estate license (though this comes with many other risks too)
• Building a buyers list first, taking pre-orders and not needing to market homes at all
• Paying cash or using transactional funding for legitimate double closings

Some amateur self-appointed real estate investing ‘gurus’ advise simply getting permission to market before closing as a part of purchase contracts. However, this isn’t a solution by itself. You can put anything on paper but that doesn’t make it legal or protect you in court.

Do get permission to avoid issues, try new ways of marketing and check out transactional lending to fund your deals and achieve higher volume levels when wholesaling homes if you want to stay ahead of the curve and avoid the wrong attention.

 

As the government struggles to pay its bills more calls to kill off Fannie Mae and Freddie Mac are hogging the news headlines.  So will shuttering these mortgage giants mean the end of flipping houses for real estate investors?

In reality both Fannie Mae and Freddie Mac could certainly survive if privatized. They functioned very well like this before, even though there was always the impression that they would be bailed by government in a crunch, and certainly they probably would be again if they ran into trouble, being deemed “too big to fail”.

In fact, privatization of these massive mortgage houses would certainly demand they become more competitive and work to become solvent and produce profits for shareholders. This would likely result in an even better line up of loan products for home buyers and real estate investors.

However, many point to the real problem (and include FHA) as being continued pushes by the government through various administrations to ease down payment requirements and not demand higher rates for making riskier home loans.

However, it is interesting that the FHFA has recently announced a return to the subprime style ‘No-Doc’ mortgage loan, at least for refinancing delinquent homeowners, and is being heralded as the ‘solution’ to the foreclosure crisis. Perhaps they shouldn’t have gotten rid of them in the first place?

Anyway, real question is, if Fannie and Freddie are done away with altogether, or at least if low down payment loans become a thing of the past, and 20% down is the new standard for all (a reversal of current trends), will it be the end of flipping houses and a crippling blow to real estate investors?

Fortunately on the acquisitions side transactional lenders are still offering 100% plus financing, regardless of credit, employment, assets or appraised value.

However, on the sell side it could certainly mean a need for some investors and sellers to tweak their strategy.

Those already focused on true wholesaling and that are flipping houses to buy and hold investors as rentals as their end buyers won’t likely see too much change in business. In fact there ought to be even more of them busy acquiring rentals as the demand for them, and yields will likely soar as fewer individuals and families will be able to buy homes in the short term.

Cutting off more low income home buyers may stall or slow current double digit increases in home prices temporarily, but you can bet it won’t be long before that continues, whether thanks to innovative new down payment assistance programs (which might be a better bet for the government and banks to engage in rather than high LTV loans anyway), or a further surge in funds and international buyers scooping up U.S. rental properties, as the market will prove to be more solid than it has in generations.

So the bottom line is those relying on retail home buyers with high loan-to-value financing might feel a pinch if these things ever happen, though true real estate wholesalers using transactional lenders to fund their property purchases and flips shouldn’t have any reason to sweat. Just make sure you are tapped into the best funding sources now and are positioned to market to the best buyers.

 

It’s a hot time for investing in real estate and there is no question these are not just the optimal conditions for flipping houses, but perhaps the best we have ever or will ever see. Unfortunately, the dramatically improving U.S. housing market is giving many the same idea and competition for homes is heating up.

Nationally foreclosures have fallen some 30% since February 2012 and the National Association of Realtors reports buyer traffic up 40% as of the beginning of 2013, while pending homes sales continue to rise.

This is causing multiple offer situations to rise rapidly from coast to coast. We are no longer just taking about 3 or 4 offers coming in on homes over a period of weeks. Realtors are frequently reporting a dozen of more offers within hours of homes going online on the MLS. In one of the most dramatic cases recently a West Coast real estate investor reported going up against 80 other cash offers and even bidding $15,000 to $20,000 over asking price with little hope of even receiving a counter offer.

So how can investors bid and win in among stiff competition like this?

With at least 30% of all real estate transactions being in cash today it is clearly a disadvantage not to be able to act as a cash buyer in this market. Fortunately using transactional lenders can enable wholesalers to effectively act as cash buyers with flash funding and Proof of Funds letters to back them up.

Sometimes it’s about price, other times it is just matching the seller and their agent’s desired timeline and quirks. Often they want to see higher deposits or fewer contingencies to prove how great a prospective buyer you are or it might just be a matter of spinning your personal story.

Another major part of this issue that many don’t understand is that Realtors often refuse to even present offers unless they are gaining both buying and selling side commissions and are effectively doubling dipping. While this certainly isn’t fair for the seller who is normally unaware, the best tactic for overcoming this is to make more direct Realtor connections and make sure you are always dealing with the listing agent, not a buyers’ agent.

Another major reason for such dramatic bidding wars is often the price range and property type investors are targeting. Their focus is often on the ‘bread and butter’ 3 bedroom, 2 bath single family home that also butts heads with the 30% of the market that is made up of first time home buyers. Perhaps targeting a different price range or property type could yield better deals with less competition.

Note that there are also many areas of the country where foreclosures are still spiking by double and triple digit rates and could offer many more choices and bigger discounts. This includes Washington, Florida, New York and others.

Of course switching acquisition strategies from bidding on publicly marketed properties to targeting off market properties and homeowners directly can also make a world of difference.

What are the biggest challenges and fears facing real estate wholesalers in 2013 and how can you overcome them?

There is little question that we are seeing the best combination of conditions for flipping houses that we might have ever seen. Still new and veteran real estate wholesalers alike have their concerns, and rightly so considering the trough we are climbing out of. However, more than being afraid of risk some are equally or even more afraid of not being able to take full advantage of the current market and banking all they can while times are good.

So what’s bugging wholesalers today and how can you overcome these fears with ease?

The Top Five Concerns Facing Wholesalers Today:

1. Financing

It doesn’t matter whether you have $1 million sitting on the sidelines or only a pocket full of pennies. Investors want more money to make big moves and scale while the discounts are juicy. However, there are two sides to the financing challenge; wholesalers making acquisitions and finding buyers that can qualify for loans. When it comes to end buyers today look abroad; 35% of transactions today are cash deals and much of that money is coming from overseas. To fund your flips look to transaction funding for easy access and maximum leverage.

2. Deposits

Most wholesalers want to get as many offers out there as they can but they are also concerned abount the amount of earnest money deposits being demanded and the risk of losing them.

Three options to consider:

• Get end buyer money upfront to fund deposits
• Choose HUD homes which require very little down payment
• Only make deposits with your own real estate attorney or title company

3. Getting Real Guidance

Statistics and forecasts continue to be confusing and many investors wish that they had access to an expert second opinion. This is a great time to take advantage of coaching; it’s what top performers do. It can help to cut through the media hype, keep you accountable and moving forward and provide the critical insight required for building a scalable and sustainable wholesale business.

4. Getting Better at Networking

Constant networking is the foundation of great success in real estate investing and a consistent flow of business and income. However, not every investor is a bubbly social extrovert. That doesn’t mean it can’t work for you.

For those that hate mingling in big crowds consider:

• Showing up early and staying late to make easier connections
• Slowing the pace and focusing on one or two good connections
• Choosing a better venue. Try intimate dinners, lunches or activity based networking
• Practice your pitch
• Focus on how you can help them, not yourself

5. Understanding the Local Market

Many don’t see a relation between the media spin and their local markets. If yours hasn’t turned yet don’t complain; most investors want access to more distressed properties. The National Association of Home Builders Improving Market Index shows that 70% of major metros are on the rebound and every state has at least one major metro area moving up the list, showing the recovery spreading fast. Of course some patterns are changing, though there are great opportunities for flipping houses in any market. If you don’t like the mix of pros and cons in your local market you shouldn’t have to look too far afield to find the right blend.

Everyone cheers when the banks get their wrists slapped for fraud but are increasing lawsuits tightening the home loan market even further, and if so what does this mean for real estate investors?

Politicians claim they understand that mortgage lending needs to be loosened up and that consumers need easier access to credit but are current moves, simply driven by panic and actually having the opposite effect?

In the last couple of weeks we’ve seen more mortgage giants being sued, with government promising more lawsuits on the way as well as an announcement of 530 indictments for mortgage fraud this year alone. Most recently this even includes Wells Fargo being sought for $190 million in damages for bad loans taken on by the government and Wells was arguably one of the most cautious of lenders during the recent boom and even more so now.

Yes, fraud, which has surprisingly only rocketed since 2008 needs to be stopped to prevent greater losses for the government and tax payers and to restore confidence in buying mortgage backed securities in order to keep money in the market. However, the dramatic increase in lawsuits and prosecutions could certainly make things even scarier to investors realizing how deep and widespread this fraud really goes.

On top of this, this all means more payouts being demanded from banks, which may not really hurt them now but certainly makes them less eager to make new loans.

This could just be the tip of the iceberg too as the government plans a new system for reviewing loans earlier, threatening to discover even more fraud in the next few months and kicking back more bad loans to originating banks.

There may have been some signs of credit easing recently and demand for more and riskier securities with better returns but more lawsuits and a tightening on behalf of originators who are too afraid to make loans could slow housing growth in 2013.

However, before Americans throw up their arms in despair, this may not be such a bad thing. Nationally home prices rose over 10% in the last year, with some areas seeing growth exceeding 15 and even 30%. If we don’t want to race to another bubble then reasonable growth is good. Plus there doesn’t really seem to be any lack of buying power in the market with the best properties still being snatched up in days.

Thankfully for investors focused on wholesaling and flipping houses the rise of transactional lending means they aren’t hurting either. This type of funding provides them all of the capital they need to finance their rapid, low risk flips without having to jump through the endless hoops of banks, making it much more attractive anyway.

As the housing market improves all sorts of tempting real estate investing ideas get floated and become more ‘attractive’ from rehabs to rentals to getting into new construction, subdividing land and even investing in real estate stocks but there are at least 7 good reasons investors may be wiser to stick with wholesaling…

1. Rehabbing Can be a Nightmare

There are profits to be had from rehabbing and fixing up homes and it can be fun but you never know when a project is going to turn into a complete nightmare, money sucking pit which puts you in the hole.

2. Holding Properties is Risky

Every day a property is held means exposure to more risk. There is risk from natural and manmade disasters, vandalism, bad tenants who kill cash flow and changing in the market. Wholesaling real estate and flipping properties means being able to eliminate all of this.

3. Faster Returns

Being able to turn around a property in a day or even 3 days means an incredibly short cash cycle and rapid paydays. This means the ability to do far more deals a month and year, dramatically driving up income potential.

4. No Need to Take on Partners

It can feel a little more cozy to have someone else coming along for the ride but partners pose all sorts of potential issues and you never know when even the most apparently concrete partnerships will fall apart for a variety of reasons leading to big losses.

5. Growing Opportunity

As more real estate investors and home buyers gain confidence and jump into the market they need a source for good properties just like you. Don’t compete; serve them.

6. Minimal Risk of Lawsuits

Lawsuits, even bogus, malicious ones which end up going nowhere can be extremely expensive and stressful for real estate investors. This risk often comes from repair work done, missing seller disclosures, tenants and others being injured on properties and more. Just avoid it.

7. Easiest Deals to Finance

Wholesale real estate deals are the easiest to finance. By using transactional funding there is no need for jumping through the endless hoops that come with qualifying for conventional mortgages or having to burn significant resources to find private mortgage lenders or even getting burned by crooked seller financing deals.

 

Has the iPhone gone from iconic mobile device and invaluable tool for real estate investors to becoming one of the biggest threats to maintaining their competitive edge and staying in business?

The FBI is Tracking You on Your iPhone

A recent hack of an FBI laptop revealed a database of over 12 million Apple users’ IDs, names, phone numbers and home addresses. 1 million of these UDIDs have already been publicly leaked on to the web and the rest could easily follow.

However, beyond the privacy breach and threat to personal information it is also a reminder that ‘big brother’ is constantly monitoring you. With the iPhone and iPad they know what you are saying, how much you are making and where you are 24/7. While this may not seem like a big threat to real estate professionals who are doing things the right way, this plus the capability to remotely operate microphones and cameras on mobile devices even when they are off means it is important to watch what you say, who you do business with and even what you joke about. Even if you haven’t done anything wrong you really won’t enjoy a SWAT team rolling up to your door or an FBI task force swooping in to raid your files.

Lessons in Maintaining Your Competitive Edge

Even before the anticipated official announcement of the new iPhone 5 on September 12th leaks have resulted in third party vendors already making and putting iPhone 5 accessories up for sale on the web.

This may not seem significant for your real estate investing business yet but if your competitors know what you are planning, what niche you are after or what your next marketing move or contest will be they can get ahead of you. Unlike apple you probably don’t have the legal team to get a billion dollar settlement from the competition when they under cut you. Leaks can come from insecure connections, in-house staff and third party vendor representatives who are asking too many questions. Don’t let them steal your best lead generation sources!

Apple Helps to Erase Online Identities

In another recent Apple fiasco an employee transferred control of a user’s accounts to a hacker resulting in their entire online identity being erased or hijacked including emails, online file storage, social media profiles and wiping out all Apple related devices.

This would clearly be a major setback to any real estate investor or Realtor. Don’t leave business vulnerable; backup all data including files for current deals, marketing materials, web content and contact lists.

 

Have we really hit the bottom of the housing market or is there some truth in the pessimists’ claims that we still have a little way to go and there could be some fluctuations still to come?

How the Doubters Prove the Real Estate Recovery is here

Almost all experts in all areas of expertise agree that we have already passed the bottom of the housing market. Yes, there could be some pockets of the country still coming around as others are already pushing double digit growth and there could even be some minor dips in some places as the flow of foreclosures is tweaked and the mortgage market and economy are fixed. However, any negativity in the real estate market today is pretty clearly the work of a small group of individuals attempting to get their name in the news and a few media outlets desperately trying to keep up readership with attention grabbing headlines.

In fact historical housing cycles show it is at these times when property prices are improving, homes are selling faster, home vacancies are dropping and the few question the sustainability of the rebound that we have officially entered the recovery phase.

It’s Not a Boom yet…

It is important to differentiate the recovery phase from a boom. We are still working through foreclosures and lending issues, while the economy waits for the real estate industry to bring it around. This is still the ground floor opportunity to get in.

What about the claims that traditional real estate cycles don’t apply to this roller coaster ride?

Despite different players, slightly different tactics and the internet the fact is this is just a part of the normal housing loop we have been going around for hundreds of years.

All of the indicators from the swelling of the bubble to the foreclosures, tightening of lending, falling values and increase in rentals and cash flow from the slump are exactly repeating history.

What Happens When the Real Estate Boom Really Kicks in?

Once we really start kicking we can easily expect a good 10 to 20 year run up in home values which will continue to snowball until the bubble bursts again.

This doesn’t make real estate a bad investment; in fact it should give investors and the average home buyer confidence.

Just don’t get caught short later. When it starts really getting hot look for the areas which will hold out the longest and demand bigger discounts on homes you are flipping.

If you can hold a couple of properties and cash them out before the next bubble to reload on cash and take advantage right when hits bottom this time you’ll be even better off and positioned to create even more wealth. Know your cycles and use them to your advantage.

Is it time to “Just say no to REOs” and find a better source of distressed properties?

RIP for REOs?

In any other industry manipulating inventory and fixing prices would result in major public outcry, high profile investigations and massive lawsuits. There is no question that banks and mortgage holders are doing this with all of the shadow inventory being held back and the bidding wars which are ensuing.

These institutions have already been found guilty of incredible amounts of foreclosure fraud and in many cases foreclosure auction rigging too and have essentially gotten away without being penalized. SO why wouldn’t they do it with REOs?

Of course if the numbers still work for real estate investing and profit can be made then there is no reason not to buy these homes except for snubbing these lenders. However, this does not mean investors should go as far as over paying or buying on speculation alone.

Some REOs may still be good deals, other not so much. Either way it is still obvious that real estate investors ought to be fishing for deals in new directions.

2 Easy Solutions for Finding Deals with Less Competition

1. Look to New Areas

If your local market is way too hot like Sacramento or Miami or Phoenix then way not look a little further afield for real estate investing deals?

Perhaps even 100 miles away there are great destinations ripe for the picking. One example of this is Bonita Springs in Southwest Florida, a little over 100 miles from Miami, just south of the sizzling Cape Coral market and bordering one of the wealthiest cities in the world, Naples to the south. The area is financial stable, has great potential for growth, yet often floats under the radar and there are off market homes and some which have been sitting on the market. Investors will find single family homes here from $70,000 to just over $100k a few blocks from the ocean and $10 million mansions. Other similar markets could be Mobile, AL and pockets of CA.

2. Streamlining Mass Direct Marketing

There are still a huge number of motivated sellers out there but so far it has been extremely challenging for solo investors and small real estate investing companies to reach them due to time constraints. However, by using auto dialers and bulk SMS investors can slash labor and connect with live leads all day long, while covering a much larger share of the market.

REOs and foreclosure auctions may be fast becoming unviable sources of discounted properties for real estate flipping houses but that doesn’t mean there aren’t thousands of motivated sellers out there.

Scouting for local distressed properties one by one can uncover some great bargains but for serious real estate investors it simply may not provide the volume of business they are looking for to achieve their goals and as powerful and cost effective as internet marketing is sometimes it takes a while to pick up steam.

So what’s the fast solution for tapping large databases of motivated sellers for real estate investors?

There are data compilers and lead list providers out there who already have massive databases of the prospects real estate investors need.

Sources for these leads include providers such as:

• Info USA
• U.S. Data
• Credit bureaus
• Caldwell
• US Lead List

Real estate investors are able to filter these lists and hone in on their desired prospects with an array of ‘selects’ for pre-qualifying those they want to connect with.

These selects include factors such as:

• Credit scores
• Loan-to-value
• Amount of home equity
• Age of loans
• Mortgage history
• Current mortgage interest rates
• Lender name
• Private or institutional lenders
• Geographic area
• Amount of household debt
• Age
• Income
• More

Note: It is critical to ensure that you are legally able to obtain this information and market to these consumers before acquiring these lists.

This is quite a bit of data and background on potential homeowners as prospects though lists can be overlaid even further for enhanced targeting. However, it is no secret that some of these homeowners have been hit with a good deal of marketing already in the past months, especially if they have just fallen behind on their mortgage payments.

Forward thinking investors can increase their results with a little creativity and going back to those who have had more time to let the gravity of their situation seep in or by tapping into niche groups.

For example this could be borrowers who have recently applied for mortgages but haven’t gotten them, those whose lenders are offering big short sale payouts or who’s short sale payout offers are expiring like Bank of America’s. Or prospects can be targeted by age or life changes such as those getting married, divorced, filing bankruptcy or who may have balloon mortgage payments coming due.

Real estate investors can take their pick of how to market to these lists from direct mail to email to calling them or even knocking on their doors.

Real estate investors have recently been crying out for help as REO prices rocket and the lenders holding them make increasingly ridiculous demands but is it all an artificial rebound?

Real Market Improvements versus the Hype

There have certainly been many real improvements in many real estate markets across the U.S. over the last year, especially in hot spots Miami, Silicon Valley and a few others. However, statistics show that on a nationwide level REO prices have been gaining steam faster than retail home sales. At the same time real estate professionals have been busy telling the media that the threat of shadow inventory has evaporated and there are just a couple of weeks or months of inventory left in some cities, leading to any even more desperate surge in demand for what little is left out there.

This has been spurring bidding wars in many hot markets with cash rich funds and investors over paying for property and smaller investors barely getting a chance to get an offer in.

However, there are two major factors here that many real estate investors aren’t really paying attention too.

The first is that real estate agents are pros at hyping up deals, it’s their job. They really shouldn’t be revealing any information on other offers at all, so by telling investors or other agents they had better come in high because they already have an offer for $X they are really breaking rules and could simply be telling tall tales. Don’t fall for the hype and certainly don’t be seduced into paying too much or waiving rights to inspections or putting too much in deposit. Stick to the principals of sound investing or you will get burned.

Secondly, while there really may be only a couple of months’ worth of REO inventory actively being marketed to the public new data shows that up to 90% of REOs are being held back by lenders. Fannie Mae has even admitted almost 50% of their homes aren’t being marketed at all. These institutions don’t want to reveal how financially unstable they really are and are hoping that by controlling supply they can jump up prices and lose less.

What it means for Real Estate Investors…

Just like foreclosure auction and tax lien sales have become unprofitable for most investors due to the competition perhaps the same is true of many REOs. That’s fine, let them go, let some other poor investor lose their money on them and perhaps you can pick them up at an even bigger discount later.

Any way you look at it the opportunities for picking up discounted properties right now are far better than during the hot boom of the early 2,000s.

Dig deeper for deals and get better at reaching distressed homeowners directly instead of just relying on REOs.

Be cautious about what you add to your own inventory but have all your ducks in a row including access to flash funding so that you can move lightning fast when great deals do hit your desk.