Afternoon Everyone,
Ok, quick question. I've found a way to locate approx 50 (+/-) leads a week and decided on direct mailings to contact the homeowners initially. My basic question, is:
How do many investors decide on the
1)number of mailings
2)type of mailings
3)reasonable cost of mailings
4)frequency of mailings
I know this seems like alot of questions, but I’m hoping that once these are taken care of I can finally get started. Any information is HIGHLY APPRECIATED. thanks ;D
It really depends on your target. If you are mailing those in foreclosure, then the number is decided by the number of people in foreclosure. But if you are targeting a specific area/zipcode or land lords, then you decide how many you want to market to.
General rule of thumb, you will get 0.5% calls on your direct mailing and smaller number will even qualify.
I am planning on hitting one zipcode a week and rotate them so I can market each zipcode once every 3 to 4 weeks. The zipcodes I am interested in has an average of 2000 residences. I might start by targeting a zipcode that has high number of foreclosures first then expand to a second zipcode and so forth.
As far as cost goes, it depends on the method of marketing. Letters or Postcards and amount ordered. You may also need to order the addresses from list services such as:
www.usadata.com
www.melissadata.com
They will charge you per address and the more filters you add, the higher the price. If I recall correctly, it averages about $200 for 1000 addresses. You can order one set and mail to it for few months or mail to half of it or quarter of it in rotations.
Post cards vary in price depending on where you order them from. You could aim at around $0.45-$0.50/post card mailed (printed post card plus postage). The price will vary based on size and colors as well.
So you are looking at around $700-$900 for 1000 mailings first time around, then around $500-$600 second round since you already ordered the list.
This may sound high, but if you get 1 deal out of two or even four mailings, then it more than it pays for itself.
Do you usually get one deal out of every mailing/every few mailings? How have your results been?
I agree with Fadiz, if you can nail 1 deal out of 4000 mailings I think you will still realize a decent profit…I send direct mail out monthly and I get between a 1.5% and 2% response rate…All preforclosure people, so it’s pretty targeted. My system isn’t the most efficient b/c I buy my postcards unstamped and have my sister address and stamp them and then I mail them out on my way to my 9-5…
Thoward, mail as much as you can afford and pick up some bandit signs…You will be busy before you know it.
.02
Luxx
Fellow Investors,
Being new to the game of investing, I’m trying to find the MOST efeetive means of locating people in pre-foreclosure. I’m having a difficult time locating them. I’ve accesed Realty-Trac, but find theire information to be much out dated. I look in the paper, but find nothing to indicate them to be motivated sellers. Does anyone have any suggestions to where I should look next? It would be greatly appreciated. Thanks…Terell
It depends on where you live, each state has its own laws when it comes to foreclosure notices but in general, there are services that you subscribe to locally. They would send you a list of those in foreclosure and at least the loan balance and first lien balance.
Thanks,
I live in Colorado Springs, CO and I would like some recommendations of what organizations I should consider subscribing to in order ti gain this valuable knowledge. Terell
You are in a good market. One of the Foreclosure gurus is from Colorado, lookup Paul Wells. I am going through his course as we speak. Colorado has foreclosure listings, I am not sure who they are though. Someone else on this forum may know or you may try to google it.
Paul usually gives 1 day event for $99 that walks you through the entire process and shows you how he does it. I’m not sure however how close or far it would be from you. His website and program is called rookie to riches.
Fadi
Thanks, Fadi…
I felt Colorado would be a great market for the foreclosure arena. I just needed to know where to get started at. I will search his website and see what he is offering regarding education in this industry. Again, thanks for the information. Terell
You could just look at your county’s court records for foreclosures. With that big of a city they should be online and free.
Anyone know how to find Bright Colored Envelopes in Bulk? I figured that the best way to get my postcards read (at least in the first mailing) is to send them in a Bright colored “birthday-looking” envelope addressed to the HO.
I’m also thinking about throwing in (maybe toward the fourth mailing) a keychain (perferrably a small dollar sign) to keep their interest going. I’m kind of dreading the cost on that but figure it will be worth it. I gave it a try on google and to be honest I wasn’t too happy with the results found.
The cheapest envelopes I’ve found are at: www.tradersectworldofpaper.com
He has an ebay store too, but cheaper to go direct and he ships using media mail; making shipping costs really cheap.
-Joel
I’ve used www.actionenvelopes.com with great results. They’ll give you every shape, size, and color imaginable. They even have some that look like priority envelopes as well.
I’ve gotten a 10-15% response from my mailings using envelopes purchased from them. I’d definitely recommend.
Big Cheese
PS-Check out my blog on all things real estate at www.bigcheesemarketing.com
Here’s a quick question. What do you all think would work better? I’m back and forth on the idea of mailing out a series of pre-foreclosure “informative” letters to the homeowners each month or a “I can help you stay in your home” post card. What usually gets a better response for a pre foreclosure? I’m thinking the letter, and saving the postcards for mass mailings to certain areas. ???
By communicating the benefits of them selling to you, rather than the letter being about you and your company, you’ll allow your sellers to see themselves in your letter and have a better chance of them calling you.
In my experience, the letters which target them emotionally (identifying the situation they are going through with the banks calling all the time, etc) work better than straight information. It’s a tough line to walk, to be sure.
Many people operate on “emotional truth” rather than factual truth. That is to say, if you can get them to react based on what they feel rather than what they know to be true, you’ll get the call.
I’m not saying beat them down, make them feel like dirt. Please don’t misunderstand. You’re dealing with folks in trouble, and the opportunity to help them is a great responsibility. By empathizing rather than sympathizing, you stand a better chance of getting a response from the sellers.
Your buying strategy will also dictate how your letter is written. If you’re buying sub2, then a letter about debt relief would be in order. If you use hard money, a letter about keeping a foreclosure off their credit would be nice. It all depends on how you plan on buying and tailoring the letter to suit that particular need.
Big Cheese
Correction www.actionenvelope.com.
If you go to www.actionenvelopes.com , you will be taken to some wierd site.
Being that everyone was so helpful with the first questions, I figured I would give a quick update and see if anyone had any info they could share also. I just put together a series of about 6 letters to send out to Preforeclosure owners at different intervals throughout the process. I’ve tailored my listings down to about 180 leads bi-weekly, and utilized the links for the envelopes. I just sent out the first official batch 
(with the printing help of Officemax).
Here’s the hard part:
WHAT DO I DO NOW?! i know it seems a bit stupid to ask the question but should I just sit back and hope the phone rings? I will constantly be sending out more letters to new addresses and continuing the cycle for the old houses, but what in the mean time? I’ve heard conflicting info about “Cold-Call owners” and “DON’T CALL OWNERS”, but it seems that something should be done after the letters go out. I’m trying to employ the “HAVE THEM CALL YOU” method. Am I just being impatient? :-\ Thanks again for the info.
I think what you do next is entirely up to you. If you have the time and inclination, develop a script and start calling them. You’ll need to find some of them by using a people finder, but for the ones you can find and contact, work your magic and get them talking to you sooner than later. Folks in pre-foreclosure aren’t a real motivated group until 2 weeks before auction.
Push/Pull marketing is always going to be better than Pull only. The letters will probably net you 2% after they’ve received all 6, so until the system gets humming, you may want to busy yourself with some phone calls or door knocking (or hiring of people to do that for you).
Keep us posted on your response rate.
-Joel
Thoward,
Never, ever put all your marketing eggs in one basket. I love what jl said about calling them. That’s a great suggestion.
You might also want to use other marketing medias like newspaper ads. If you’re targeting one specific county, use the county paper. Don’t go for the big metro ones - you’ll get lost in the shuffle and it’ll be a waste of money. Save that paper for selling the house! 
County papers are usually cheaper and are read by county residents.
The bottom line is, test, test, test! While you’re waiting for responses from your direct mail to preforeclosures, maybe mail to expired listings, or have some doorknockers made up for FSBO’s (For Sale By Owners), or try signs. If you wait for a response from one form of marketing, and nothing works out, then you wasted time that you could be trying other things and getting phone calls.
Make sure your marketing is consistent and that you always test at least one new marketing idea per month. This will always ensure that you are finding new ways to get phone calls and are never sitting on your laurels waiting for the phone to ring.
To your marketing success,
Rachel Young
YOUR TITLE CO. WILL HAVE THE LIST OF NODS. I USE FIRST AMERICAN TITLE AND RINT THEM IN .PDF ONTO MY LAPTOP EVERY THURSDAY MORNING…