Putting Profit in your Pocket Through Probate Properties
Leads are the lifeblood of any business and there are all kinds of ways to generate them. But this way is a guaranteed winner!
Target marketing is how we maximize our marketing dollar by selecting a very specific audience and marketing to them. This means identifying people who most likely need to sell their house. People need to sell their houses quickly for ALL kinds of reasons but one that is often overlooked is when a property is going through (drum roll please)…PROBATE.
Probate Is The Legal Process That Takes Place After Someone Dies.
Here’s what it includes:
And these are just to name a few. The probate process can be simple and pain free or it can be downright messy and complicated. Don’t let that scare you though because sometimes the messier it is, the better the deal it is!
The person in charge of the probate process, and who typically makes the decisions regarding the house, is called the executor. You will also see him or her (it is usually one person but not always) called the petitioner or the personal representative.
This person is often one of the heirs and is the person named in the Will that will handle the probate from start to finish. If there is no Will in place then this person is usually appointed by a judge.
The responsibilities of a petitioner can be quite time consuming and burdensome which makes them great candidates as motivated sellers. Here are a few of the petitioner’s responsibilities:
- Filing papers in court
- Managing the assets
- Proving the validity of the will
- Presenting lists of property to the court
- Paying off debt still owed by the estate
- Distributing all assets to the heirs as dictated by the will
The executor (or petitioner) is the person we want to locate because he is typically the one that is handling the affairs in regard to the property and will sign all of the paperwork to sell the house.
It Can Complicated But It’s Worth It
Sometimes, all of the heirs have to be in agreement before any paperwork is signed and sometimes they have the authority to decide for themselves.
Once we locate the executor it is now time to pre-screen him or her and go take a look at the house. Probate properties are often a “perfect storm” for a great deal.
Most of the time they are vacant, are outdated, have no mortgage, and the personal representative needs to sell it to pay off debts the estate owes and pay the attorney handling the probate. The deceased owner was typically elderly and had the house for a long time which means in many cases the mortgage has been satisfied.
It also not uncommon that the person did absolutely no updating to it and had a hard time maintaining the property which will make it perfect for a rehab and flip or even a wholesale deal to sell to someone else.
So How In The World Do We Find These Precious Deals?
Most often we need to march ourselves down to the courthouse to obtain the information. Probate records can be found at the courthouse in the county where the house is located. Usually we will need to use the computers at the courthouse to find the information we are looking for.
While this may sound inconvenient and time consuming, it will produce quality leads which other investors are missing out on because they don’t want to do the work!
Look For Two Kinds of Probate Cases
There are two main types of probate cases when it comes to those involving real estate: Formal Administrative and Summary Administrative.
Formal administrative cases are the most common type of probate case. Formal cases are done when the assets in the estate are more than $75,000. These types of cases are usually taken care of with an attorney and last longer than the summary administrative cases.
On the other hand, summary administrative cases can be used to probate an estate when the decedent’s (the person who died) assets are $75,000 or less or they have been deceased for more than 2 years.
This type of case may be done with an attorney or may be handled by the executor and the heirs themselves. This type of case is typically shorter and less complicated than its counterpart, the formal administration.
Once we find all of the formal and summary administrative cases for a given time period we can now begin to locate the “Golden Docket,” the Petition for Administration. It is is the golden docket because it contains all of the information we need to know to send the letter.
Four Pieces of Information You Need To Send Out a Good Letter and Generate a Quality Lead:
- Deceased Name
- Deceased Property
- Executor’s name
- Executor’s mailing address
Once you have all of this information you can now send out the letter. The letter should be personalized and mention the passing of the heirs’ loved one. It should also have the property address in the body of the letter and it should list all of the benefits that we can offer.
When It Comes To Probate We Can Offer Some Things Typical Retail Buyer Probably Won’t
- An all cash offer that will make it easy for the personal representative to disperse
- Handling of paperwork (the executor will appreciate this as for last few months they have been handling all of the probate paperwork
- The heirs can leave whatever they don’t want, in the house
- No need for the heirs to clean up the house
If done right and consistently, the time and effort it takes to collect the information will be well worth it.
Once you start sending out the letters, the phone will be ringing with motivated sellers who have vacant, outdated, free and clear properties that need to be sold NOW!
And don’t we investors love those 5 words in one sentence: motivated, vacant, outdated and free and clear?! They are the words of a great lead and a profitable deal.