Through the magic of technology we’re actually away on a little two year anniversary trip to Whistler… Dave surprised me with a get away to celebrate … but thanks to this guest post from Ron Mead you will barely miss us!
If Ron’s name sounds familiar it’s probably because he was my biggest competition in the Battle of the REI Blogs. He kept us fighting right up until the end. Ron’s an expert on probate real estate… something I knew absolutely nothing about before the battle. He was kind enough to share a little overview with us, and with you! If you have questions please comment below and I will ask Ron to stop by and answer them for you!! Enjoy ….
What the Heck is Probate Real Estate?
by Ron Mead
For many folks, the first time they hear the words Probate Real Estate, they head for the hills. Pictures begin floating through their heads of Perry Mason like attorneys, court rooms with judges pounding their gavels, complex legal documents by the bushel full, deals that take forever to complete……Yikes! What a nightmare!!!
Well, let me assure you none of this is true…..if it was I WOULD NOT have been working in Probate Real Estate for the last 14 years.
But, it’s really pretty simple stuff…….as a wise person once said “It’s easy if you know how!”
Hi, I’m Ron Mead, The Probate Guy and I’d like to take a brief moment and explain a little about how I discovered this lucrative field and why I think it is one of your very, very best opportunities in Real Estate investing.
Back in 1995, my Father passed away and my Mother followed in 1996 so I ended up inheriting a house about 250 miles from where my wife and I live here in Oregon. To make along story short, it took many, many two day trips, lot’s of meetings with different real estate agents, tons of phone conversations, a couple of U-Haul truck rentals, seven months and lot’s of my time before I finally got Mom and Dad’s house sold. It was a huge time consuming event that I didn’t really need at that point in my life.
One day as I was driving down I-5 during one of my trips back and forth, I envisioned someone calling me and making me a cash offer, even if it wasn’t the full price I was asking. I would have taken it in a heart-beat. That didn’t happen but the idea stuck in my head.
So when we finally got the house sold, I thought to myself “I wonder if there would be a way I could contact others who have inherited houses and see if they too might be interested in a quick sale?” If I could figure out a way to contact them and send them a letter, a certain percentage of them would be interested in a quick sale at a discounted price rather than having to go through the same hassle I had.
Right then and there was born my new career in Probate Real Estate.
Well guess what? My hunch was right. It took me three months to figure everything out but I finally got my first little deal…….a small condo that I bought and resold, making a nice profit of $9300. Sweet!
But you might be asking “Why would sellers (heirs) be willing to sell their properties to you at a discount?” Good question! There’s several reasons.
One, the heirs, just like you and me, don’t need another project in their lives. Today, we all lead very busy and demanding lives and the thought of having to go through all the hassles of cleaning up and selling Mom and Dad’s house is not very appealing. Some of the folks you contact will be quite willing to take a discounted price for a quick sale. Other’s won’t.
Two, the concept I call “Free Money”. When you inherit a house, you are really the beneficiary of someone else’s work. Consequently, you are much more willing to negotiate the price on this “gift” than you would be if this was your very own house.
Three, distance. Often times the heirs don’t live in the same city as the inherited house and trust me, traveling back and forth gets to be a real pain. If the kids live in Bangor, Maine and the inherited house is in Tucson, Arizona, believe me, you will quickly have a motivated seller.
Four, the heirs are making monthly payments on the debt secured by the house. If they are making these payments, the heirs will be highly motivated to sell very, very quickly. Nobody likes having to write a mortgage check for a house they don’t live in. There also might even be some back taxes that are coming due and the heirs will need some quick cash.
So I think you can see thee are lots of reasons for the heirs to be interested in your discounted offer. All you have to do is contact them.
Now you might be thinking, “RonBo, what about all the legal hassles you have to go through to buy the house?”
Well, this is the interesting part that very few know……… Once the court appoints what is called the Personal Representative of the estate and that person has the authority to act for the estate…..and that includes selling all the personal and real (house) property so that’s the only person you need to deal with……no attorneys, no courts, no legal paper work.
So that’s how easy it is folks, just work out the deal with the PR (which normally is a 20%-50% discount) and it’s just like buying your next door neighbor’s house.
Oh, one thing I forgot to mention. Even in times like these, the Probate market is even bigger than the foreclosure market and until someone figures our how to keep us alive forever, it always will be!
Ron Mead, The Probate Guy, bought his first investment property in 1979. He has specialized in Probate since 1996 when he inherited his folk’s property and found what an ordeal it was to fix up and sell. He and his wife Sharon live in Portland, Oregon where he now teaches others how they can begin their own profitable career in Probate Real Estate. For more information, please visit www.BuyProbateProperty.com.