Two Tips to Successfully Navigate the Probate Real Estate Niche
In my conversation with Ralph Plumb, who is a NFLer turned real estate entrepreneur, he explains a strategy that you can follow in order to replicate the same success he has obtained from one of his favorite lead sources: probates.
Ralph has found a lot of success over the years in the probate real estate niche. “The granting of probate is the first step in the legal process of administering the estate of a deceased person, resolving all claims and distributing the deceased person’s property under a will.” Upon completion of the legal process, the inheritor of the deceased person’s property will be placed on a list that is available for purchase. As a real estate investor, Ralph will purchase these types of probate lists and perform 4 to 5 direct mailing campaigns to attempt to acquire properties. However, instead of blasting the entire probate list with the standard “we buy houses” advertisement, Ralph strategy differs in two main areas.
1. Out-of-State Probate Owners
When Ralph purchases a probate list, the first thing he does differently is that he only mails to out-of-state inheritors. If someone is inheriting a property and they do not live in the same state or near the property, Ralph has found that they are more likely to have the motivation to sell the property. Since they don’t live in the vicinity of the property, it is much more of a hassle for them to manage and deal with the property, Therefore, when he obtains a probate list, he further refines it down to only keeping the entries where the mailing address of the person on record is out-of-state. Then, he will perform a 4 to 5 piece direct mailing campaign to those remaining entries.
2. Tailored Message to Probate Owners
When dealing with probate leads, Ralph has found that the most effective theme of the direct mailing message is ease of transaction.
After inheriting a probate property, the individual will typically have 3 options:
- Keep the property
- List the property with a realtor
- Try to sell it themselves
However, inheriting the property was likely not something that they were planning on, which comes with additional, unwanted tasks added to their lives. Often times, there is also the additional emotional stress that comes with a death of someone close. Therefore, ease of transaction will be enticing as well as extremely helpful for the seller!
To get the “ease of transaction” theme across, Ralph’s direct mailing message consists of statements like:
- We will purchase the property as-is
- We are not going to negotiate the repairs down the road
- We will purchase all cash, and therefore close quickly
- You can leave all the stuff in there or you can take everything out, whichever works best for you!
All in all, Ralph wants to be extremely flexible with the seller for everything that he offers.
Example Probate Deal
An example of a recent probate lead that Ralph closed on was a 3,200 square foot property in Rhode Island that was filled with 6 dumpsters worth of stuff. One of the big key points for the seller was that they didn’t want to have to deal with the stuff left in the property. Therefore, Ralph’s “ease of transaction” theme was really effective.
When marketing in general, but especially in regards to probate, it is important to put yourself in the other person’s shoes. For probate, you are mailing to someone that is inheriting a property that they weren’t planning on. There is going to be some level of emotion and time involved. They have busy lives with family, a job, etc. And now they have to deal with selling a property.
In the example above, they can’t list with a real estate agent because a realtor won’t list the property with all that stuff in it. A buyer won’t be able to go through the property and make sense of it will all that stuff in it. If they are going to put the property on the open market, a lot of sellers don’t want to put their name on a property will all that stuff in it! Therefore, their best option is to go the “ease of transaction” option that was presented to them by Ralph.
All in all, the most effective method for attaining high quality probate leads and is the most helpful to the seller is to mail to out-of-state inheritors only and have ease of transaction as the dominating theme of your direct mailing messaging. Also, be sure to put yourself in the individual’s shoes when mailing, conversing, and negotiating.