There’s a lot of positive news in the market today. So regardless of the fact that its not based on any fundamentals like jobs (lowest labor force participation rate since 1978) or real household income (low and declining)… there’s optimism in the air :-? .
When there’s optimism in the air sellers are less likely to take a discount, after all “If I just a wait a year it will be worth 10% more!” or in the case of non-performing notes “If I just wait the equity will be there…”.
So your biggest challenge in the real estate or note business today is inventory. Whether you’re brokering or actively investing you need a regular flow of well-priced inventory.
And you’re going to have to do some work to find it.
But if you’re not transacting then what are you doing? You must have regular deal flow.
There Are 3 Ways You Can Proactively Achieve Consistent Deal Flow
- Consistent marketing to private sellers
- ‘Networking’ with brokers
- Farming repeat (institutional) seller prospects
If you’ve ever marketed to private sellers (for notes or real estate) then you know it requires a massive effort. You can spend thousands of dollars on mail (per MONTH!) have dozens of meetings… and then what?
99% of the time you get unrealistic emotional sellers who simply cannot make decisions based on reason… or math.
And when you do find a truly motivated seller, someone who’s ready to take your offer, now you’d better hope they’re in a position to sell. Do they even have the equity? The rights?
To make matters worse, how many deals are you going to do with a private seller?
Almost all the time, ONE.
For all your efforts, for all the work, for all the expense you’re going to do one… lousy… deal.
I learned early on that I wasn’t interested in that game. If I was going to do all the work to get to a deal then dammit I was going to do it with someone whom I know I can do deals with again and again and again. That’s why I started working with developers and investors during the boom before I started working with banks.
Here Are Your Choices
You can spend all your money and time chasing individual sellers who, 99% of the time, can’t or won’t sell at the prices you need…
You can network with brokers where you’ll find yourself in constant competition on over-shopped, over-priced inventory (if you’re a broker yourself this is NOT an option unless you want to eat cat food the rest of your life).
You can get smart about it and you can start cozying up with the non-emotional, repeat institutional sellers of the world.
There are THOUSANDS of Banks and Credit Unions with Non-Performing Notes and REO That Will Be Sold
And that’s where the big game is at.
Because they’re in the debt position and because regulations and internal processes demand that they continue to sell quarter after quarter year after year as long as they have loans that go bad.
In fact today there are more than 13,000 lenders with some $1/4 TRILLION in non-performing notes and REO plus a couple hundred servicing companies.
We know this because we’ve built a system that automatically tracks them all.
Introducing BankProspector 4.0
Today BankProspector is in it’s fourth generation, built from the ground up for the sole purpose of helping you source notes and REO direct from banks, credit unions, and servicers.
These sellers are without a doubt the most exciting players in the market.
- There are THOUSANDS. Many of them are much too small for the hedge funds or other big players to spend any time on but for you and I? Perfect.
- They sell regularly. They’re constantly lending and then collecting on the loans that go sideways… in every market good and bad.
- They are not emotional about their sales. Sales are driven by MATH.
- There are 3 big reasons that right now is the time for you up your game and … these include new regulations a new wave of payments that are about to hit borrowers and more. These are going to drive more banks to sell more assets and I’ll tell you more about that soon.
The truth though is that this side of business isn’t for everyone. In fact most people can’t play the “long ball”, they’re too impatient, too short-sighted and they don’t bother to get the tools and information they need to be successful.
The truth is that if you want to play this game you need to know your… stuff.
More than that, you need to decide that you’re in business for the long haul. If you won’t spend the 3-6 months that it takes to tee-up your first big deal get your first listing or your first big pool then forget it. You’re too impatient for this game, too transactional. You should stick with hustling private sellers.
But if you are someone who can play long ball. Someone who’s diligent, someone who will work a system, then stay tuned here because we’re going to show you the 4 step process that successful professionals in this market use to drive new business.