I recently had a batch of business cards and flyers printed out stating that I buy houses and will pay referral fees to anyone who brings me deals. However since I’ve never done this kind of thing before I’m a little nervous about it, I want to make sure I’m doing everything on the up and up. My plan is to put flyers on the windshields of cars at public transportation parking lots (train stations, bus depots) I’m also planning on visiting the post office, cash checking places, quick loan stores, college campuses and other places where there might be high traffic or potential clients.
Can anyone who’s gone this route before share some experiences and pointers with me?
Has this form of investing proved to be successful for your business?
I’m on my way out to pickup dinner for the family at the local mexican eatery, I’m going to try and leave a few cards there if they let me. I’ve never marketed anything before (besides myself on a resume) so this is really a new experience for me. I’ll report back if this leads to a multi-million dollar deal. :biggrinparty
Sweet! If you make millions soon you should send me $250 for anwering the question! :smile I personally haven’t closed any deals like this to be honest. Never hurts though. Word of mouth is a powerful thing! Good luck!!! :beer
I tried posting an ad in the job section on craigslist today offering $500 for an address of a vacant house that leads to a sale. I’ll let you know how that works out if I get any hits.
arkitech you seem to be really aggressive, and you just started.
i am a bit nervous about leaving cards at public places. tell me how it goes, and i will do it too.
I’ll definitely leave feedback. One of the things I love about this site is reading other people’s expereinces, it amazes me how money can be made in real estate with just a little thought and planning.
That sounds like a good idea Rich, I might have to try that out myself.
Ad went up yesterday afternoon, got one response by the time I got home from work last night. I just sent the guy a long email detailing what I want from him, how he will be paid, etc. Hopefully the guy will turn up some good info and I can make some money. I have a long list of rehabbers in the state so I am targeting vacants that can be picked up by them.
2 emails so far. Here is my ad in case you want to try something similar. Again, this was posted under Jobs → Real Estate.
[i]Subject: Property Locators ($500 per lead, no experience necessary)
Body: I’m in need of people to send me leads on vacant properties in the state of CT. Leads will be followed up by me in an attempt to purchase the home to be remodelled and resold. If I successfully aquire the property I will pay you $500. Not all leads will turn into a sale as the owner will need to want to sell the property and sometimes a deal cannot be reached. Rest assured many people currently owning vacant properties are sick of owning them and paying taxes on them and will be willing to get rid of them. Please email me if you are interested and I’ll give you all the information you’ll need to get started.
I am looking to have people in every area of the state to comb the areas that I can’t easily get to myself. This is a perfect opportunity for a stay at home mom or someone that wants to make some extra money in their free time. You can work as little or as much as you want and work whenever you want. You’ll need a car to drive around and look or someone to drive you around, this is really the only necessary tool you will need. No real estate experience required.[/i]
I put only an email address on the ad, I would rather get them to email me so that I can send them a full sheet of instructions regarding what I am looking for, etc. Plus being that I work all day in front of a computer its easy for me to respond to emails and harder for me to take/make calls (especially on a subject like this that may be a long conversation).
Most states typically prohibit you from receiving a fee as a 3rd party to a real estate transaction unless you’re a licensed real estate agent.
Also how is the person who sends you the referral going to be assured that they’re going to be paid? Is there going to be some kind of contract? Will that get you in trouble later on due to first item?
Just somewhat curious as to how you intend to address those issues.
I was thinking about that today and definitely think that would be best. I will consult my attorney.
Henry-
Only one of the 3 even mentioned being worried about getting paid. I drafted a short, simple contract that lays it out so he feels better. I have no reason not to pay these guys and keep them happy so they keep sending me deals. I am planning out paying them out of my take after closing, not as part of the actual closing and not disclosed on the closing packet. As far as I know the only state to really give a problem to bird dog fees is TX, there is no such law in CT that I am aware of. I will ask my attorney though and make sure before I give them a check that I am paying them in a legal manner.
Their instructions are to get me the addresses of vacant houses, any price range but no warzones. They have been told that the more information provided the better including pics, notes, what they can find out from neighbors, etc. I’m looking for properties that can be assigned to rehabbers.
The person that is looking for the deals for you is only bringing you information. They are researching the deal and just giving you the information. They are not negotiating with the seller, signing a contract, or closing a deal. You are only paying them for their research.
Realtors will tell you over and over that this is illegal because it’s taking deals away form them. They are NOT a 3rd party to the transaction, they are not in the middle.
Might you kindly amplify on the TX bird-dogging fee problem you mentioned? Here or a pm would be great!
Given that I’m running into brick walls (see forthcoming post titled “Realtor Help” in Rehab forum…), paying a bird-dog is something I’d been thinking of doing…