And the Phone Keeps Ringing...

I got 3 more calls from probates today. I went to see one of the properties on my lunch break.

First Call: The Car Lot House... (Right next door to a used car lot)
Built 1959, another 1300 sq ft 3/1 brick rambler in a decent rental neighborhood. Comps at 200-207k, tax assessor 187k. They had just paid taxes (due on the 14th,) so they knew about the assessed amount and when I broke out the big question...

"If we could close by next Friday, what is the best you could do on the price?"
they came back with the obvious response,
"I'd like to get 187k for it." FULL RETAIL!? WHAT?
No fanfare, no reasoning for the price or calculation of profit, just a wish thrown into the air like a feather, floating ever downward...

I looked at her for a moment to be sure she wasn't kidding and thought to myself, "self, here we go again..."

It was another case of Full Retail Minus Repairs; until it came time for me to leave.

Just for giggles, I helped them work out the numbers:
187k
-11k (6%for realtor commissions if they were to sell on their own. I always take out of my #'s)
-40k (my estimate of what it would cost THEM to have the house ready to sell for RETAIL.)
-Holding costs/loan costs (since they wanted an all-cash offer)
-Little bit of profit,
And the best I'd be able to offer would be $110-120k. (I softened the delivery a bit by throwing the 120k in there, but we both know that I'd be pushing the seams a bit to try and wholesale this thing at 115k.)

(work the numbers on your own, 200k x.70, minus 25k repairs and you're at the same number. The way I used just works better when they're working the price down with you...)

The two sisters huffed, puffed and shuffled their feet. No buying signs at all. I just shut up and stood there for a good 30 seconds, waiting for a response. None came. So I closed my notebook, offered my card and said that my verbal offer would stand for 30 days, "call me if you'd like me to write up something more... official." And I started walking to the car.

Both of the women looked at each other quickly and the executor said, "well, you might as well write up your best offer so I can hold on to it." Since she didn't have a fax number, she asked that I mail it to her home. Hmm... Sounds like an investor price-comparison project in the works here...

Since I haven't had anyone show even the slightest twinge of interest in any of my crazy offers, I wasn't ready for this one so I said that I'd pull together the numbers and get an offer in the mail in the morning. I figured that I'd have time to get with my mentor and get his opinion on how to handle this latest twist... I forgot to call him on the way home (2 job interviews during my commute,) but will get with him over lunch tomorrow. I'll keep you abreast of the developments.

The other two calls were regarding the same probate case. It turns out that unknown to the other, they both called me to find out what property was in the estate. Since I only have my researcher pull the info from the first page of the probate, I don't have any idea the address or any other property info until the heirs call me and let me know what they're interested in selling. This was another twist for me... (two in a day!)

We got it all figured out in the end. The eccentric uncle who passed away didn't keep very good records and they thought there might have been more than the two undeveloped parcels of land (near the oceanfront in VB) in the estate. I wasn't able to help them and have no idea how to buy/wholesale expensive, undeveloped, near-to-the-oceanfront land, I wished them each well and went back to calling for insurance quotes...

So what is that now, 5 calls from 80 probate files? That's a 6% response rate! Normal direct mail rates are between 1 and 2% and with my own experience, foreclosure mailing response rates are even worse than that. As soon as I buy one of these I'm going to be a believer. At least it gets the phone ringing.

And now a word from our sponsor...

C'mon people!
Let's get desperate out there!
Baby needs a new pair of shoes!