I wanted to direct mail to absentee owners. I was going to get a list together using Melissa data. My hope was to wholesale or retail and sub2 one of these prospects. Then I remembered that these houses are most likely occupied by renters. I can’t just sell the property over to another - maybe even an end user if there is a lease in place can I??
If there is a lease in place with a term remaining, it would generally just transfer to the new owner. If the tenants are on a month-to-month lease, the new owners could put the tenants on their own lease.
I know it would transfer. The question I had was what if you didn’t want it to transfer. What if I sold the house to an end user. They obviously wouldn’t want tenants in the house.
I am trying to figure out if absentee direct mail is best for me because I wouldn’t get the option of selling it to another investor OR and end user. I would have to sell it to an investor planning on keeping the tenant. BUT what if the tenant were a nightmare tenant? Would the new owner be able to kick them out? A bad tenant may be another reason why it would be hard for me to wholesale to another investor.
Leases convey with the property by law. The buyer would have to honor the terms of the existing lease. If the buyer did not want the tenants, then the buyer can either wait until the lease expires and not renew it, or, pay the tenants to leave.
Ally you need to use listsource.com to get a good list for absentee homeowners. Some of the leads that you get will have a tenant in them and some will not.
You will know you have a really good candidate for a deal when you get a call from an absentee homewoner with a vacant home that is in need of repairs and they just want to sell it.
You can still wholesale deals that have tenants. I am currently working on a deal that has a tenant in it we are just making arrangements for the tenant to be out before we close. On the other hand I have done deals where I wholesaled with the tenant in place.
It all comes down to knowing your buyers. You need to get an established relationship with your buyers so that you will know how to proceed
I would just send the mailers out and see what happens. Some landlords want to sell and some don’t. Some landlords are able to sell and some are not. My guess is that most of them will have the right to sell the house as long as the tenant is in it. You could always just try asking the tenants move out if they don’t have to. I’ve done that before with success.
Hi Alex,
I follow your work on your blog and I’m impressed.
What if there are tenants in the house and you have to get in to access how much work needs to be done and the owner is out of town absentee. Will the owner arrange for you to take a look with the tenants inside?
With out of state owners are contracts done over fax or fed ex?
Do you call the owners after the mailing to follow up?
I am getting a very target list from listsource on absentee’s and I plan on doing a mailing to 900. I NEED to get a couple deals from this mailing. Any other advice anyone can give I would really appreciate it!
Thank you!
Ally,
If you NEED to get a couple of deals, then you have become a motivated buyer. Motivated buyers make bad deals. I have been there, done that, and eventually burned the T-shirt.
Have your investment criteria written out and don’t break your rules or fudge your profit/cash flow projections just to get a deal in place. Bad deals generally only get worse.
Be careful where your mindset is. Make sure your enthusiasm does not overwhelm your business sense.