Marketing to Preforeclosures:

Are you really helping the homeowner?

by Justin Lee

Are you marketing to preforeclosure prospects, and if so, are you seeing very little return or poor response rate?  Are you offering your prospects solutions to their foreclosure problems that allow them to either keep or sell their homes?  Are you able to earn money doing so?

 When I got started in real estate investing in Washington, DC, specifically with preforeclosures, I was using the same old tired methods and messages as everyone else.  Postcards and letters that screamed: “Cash for your home”, “Cash for your equity” and the ever popular “We buy houses.”

I soon realized that everybody else sent out the same message.  I looked like every other company, and brought absolutely no value proposition to the homeowner.  Why on earth would a seller respond to my marketing when it looked like dozens of other mailers that they were getting at the same time, just a few days after their Notice of Default was recorded at the county courthouse?

When I was lucky enough to get a call back from my marketing, nine out of 10 preforeclosure homeowners informed me that they “just wanted to keep their house.”   The majority of these homeowners wanted to keep their home and I had no way of helping them.

The problem was that as an investor, I could only make money when I bought the home from them.  I needed to come up with a method of earning money by helping those homeowners who “just wanted to keep their house.”   I realized that all these people still needed help, and would be happy to meet someone who could show them how to keep their home.  I also knew that it was an inefficient use of my marketing dollars to contact people in need of foreclosure assistance without providing a total solution for their foreclosure problem.

When I would go out and meet homeowners, I started collecting marketing materials sent to them and took inventory of who was marketing to them and what their marketing message was.

There were four main categories:

1. Investors offering “Cash for your equity”

2. Realtors begging for a listing

3. Mortgage brokers with promises of a refinance

4. Bankruptcy attorneys with a promise of saving the home with a Chapter 13

I began to change my marketing message and began to market a service where we told our clients about ALL of their options when faced with foreclosure.  Our marketing response rate immediately increased.  My idea worked. Tell the homeowner about ALL of their options when facing foreclosure, explain the pros and cons of each one, present them in a manner that was more consultative, and they trust you more, and are more willing to work with you.

The phone began ringing with homeowners in foreclosure wanting to know how we could help them.  I started going out on more appointments, and my hunch proved to be correct.  The homeowners did want to hear about all of their options; they only wanted to work with one company that could be a “one-stop shop” for them.  And most importantly, when I told them about the downside to each solution (we all know that there’s no one magic solution when stopping a foreclosure) I immediately won their trust and built rapport.

With this customer-focused approach, I was no longer an aggressive investor, mortgage broker, realtor or bankruptcy attorney pushing a personal agenda.  I was a concerned businessperson who was going to custom tailor a solution to their unique situation.  By showing homeowners a way to either keep OR sell their home, it gave me instant credibility compared to the other investors who were out there trying to buy their property at a deep discount.

I firmly believe that if you’re marketing the same old “we buy houses” message to homeowners facing foreclosure, you’re going to see very poor response rates.  The majority of homeowners facing foreclosure want to keep their home, however seasoned investors understand that keeping the home may not always be realistic, or even possible.

Taking the time to explain to the homeowner how they could potentially keep their home, and then exploring those options with them, is a great way to help homeowners, build rapport, and expand your investing business.

There is more than one solution as to how you can help the homeowner keep their home, and the best part about it is, you can be paid to help them!

Maybe you’ll be able to help them keep the home, or maybe you’ll be able to show them that their current monthly expenses exceed their current monthly income, and that they have no choice but to sell the home.  Maybe you’ll get a short sale out of the deal.  The possibilities are truly endless.

If you’re just marketing the “we buy houses” message to preforeclosure prospects, and you’re lucky enough to actually get someone to respond to your marketing, what will you say when they tell you “I just want to keep my house”?

If you’re not helping them to try and keep their home, or least exploring the option, you’re not only doing a disservice to the homeowner, but also to your investing business.

Think about it for a second: if you can make the phone ring from your marketing, but you don't have a solution for the prospect, and worse yet, you can't monetize that solution, that's an inefficient use of your marketing budget, wouldn't you say?

To gain a better understanding of how we help homeowners facing foreclosure, please visit us on the web at www.SaveMeFromForeclosure.com.

To sign up for free PreForeclosure marketing tips like these, please visit www.BestForeclosureSystem.com

Happy investing,

Justin Lee
CEO and Founder
www.SaveMeFromForeclosure.com