Competition asks for no $$ down - Posted by John Fredrick

Posted by Marty (MO) on January 21, 2006 at 19:17:37:

the golden rule is to not advertise negatives- for example, if you have a 3/1, list it as a 3br- don’t mention that the home has one bath.
Try something like owner may finance, flexible terms, 3br/2bath in nice Augusta park, lot rent and payment under $600- own it in 3 years!
There’s nothing mentioned about a down payment, they can see how much the total cost will be, and they can see when it’ll be paid off. Adjust the ad to reflect your area and what you need.
I wouldn’t mention your price- many people only care about the monthly payments and you’ll find yourself a little more limited in how to creatively finance if you list an exact price.
Good luck-
Marty

Competition asks for no $$ down - Posted by John Fredrick

Posted by John Fredrick on January 21, 2006 at 18:03:31:

Found a motivated seller in a larger city about 50 minutes away. Want to run a test add to develop a buyers list but I’ve got some competition. His ad reads something like this:

ATTN WILL FINANCE
3BR/2BA all appliances,
deck, shed $7900
0 down $180/mo for
58 mos 12% 555-5555

He appears to be breaking some of the cardinal rules here. I know he’s been around at least a couple years as I’ve seen his ads before. He always has at least one home for sale, sometimes more.

I’m sure a city of 360K can provide plenty of deals for the both of us, however I dont want to “break the rules” to compete. How should I structure an ad to attract the same callers he’s getting? I was thinking of something like:

NO BANKS! 3BR/2BA,
appliances, air, deck
$6500, will finance.
555-5555

Any suggestions?

Also, because it is so heavily discouraged by the grizzled veterans here do you think he might be pulling a little bait and switch here? Like advertising those terms and then saying you need a 670 credit score to qualify for that deal, how much can YOU (Mr 565) put down?

Re: Competition asks for no $$ down - Posted by patsears

Posted by patsears on January 22, 2006 at 22:21:56:

Todd,

Let me give you a little advice: only a complete idiot would offer to sell all their homes “no money down”. Your yield on your notes would be crap, and you would lose your shirt in holding costs if you had to evict someone soon after selling because you would’nt have any money upfront to offset those costs (yes, there are people who will move in and never pay anything-they are “professional squatters” who know that it takes a month or two to even get someone out legally through the courts).
I suppose if you did find someone with a 670 credit score, you could give them a nothing down deal. But anyone with a credit score of 670 most likely won’t be buying a “Lonnie Deal”-they’ll be buying a house or selling Lonnie Deals!
Stick to your guns, follow the rules (and common sense), and your “competition” will be out of business before you know it.

Good Luck!

patsears

Re: Competition asks for no $$ down - Posted by Todd (AZ)

Posted by Todd (AZ) on January 21, 2006 at 20:25:14:

or, if you REALLY want your phone to ring, just mention the monthly payment of the mobile home only without the lot rent. You’ll get more calls this way (is that good or bad?)and then you can screen them and let them know about the lot rent while talking to them on the phone. I think you are too worried about your competition. Even if he DOES offer a no or lower down than you, there should be plenty of buyers to go around if he only has 1 or 2 to sell at a time. Just my 2 cents. Todd (AZ) P.S… Call on his ad to find the answers to your questions.

Re: Competition asks for no $$ down - Posted by Rich

Posted by Rich on January 21, 2006 at 18:28:36:

Why not just call his add and see what you can find
out. Maybe even go look at the home. -Rich

Re: Competition asks for no $$ down - Posted by Marty (MO)

Posted by Marty (MO) on January 21, 2006 at 18:11:22:

don’t worry about the competition- he may be legit. this could be a home he got for free, maybe he doesn’t like the park and needs to sell asap, maybe it’s a trashed handyman special.
your ad’s pretty good, but I’d say something like “owner will finance” or “possible owner financing” instead of “will finance”. Around here, many times “will finance” is code for “if you qualify, the bank will finance”.
Good luck,
Marty

Re: Competition asks for no $$ down - Posted by Todd (AZ)

Posted by Todd (AZ) on January 24, 2006 at 08:27:14:

Patsears, I think you mistook me for someone else (John Frederick?) or mistook my post to John. Never did I say not to collect a downpayment nor have I ever nor WOULD I ever let someone in without a down payment. In fact, I’m always amazed when I read posts on here, even by experienced investors, who let folks move in for $500 or even less. To rent an apartment you will need $500 by the time you put first month, security, etc. I expect a BUYER to have a higher mindset than a renter so anything less than $1,000 and I keep showing the unit. I’m glad we cleared that up, lol. Todd (AZ)

Re: Competition asks for no $$ down - Posted by John Fredrick

Posted by John Fredrick on January 21, 2006 at 18:18:22:

Hey Marty,
Actually every ad I’ve seen of his is exactly the same offering no money down. I noticed one of them a couple years ago and have seen them ever since.

I’d like to get potential buyers to call me first. Perhaps just having a lower purchase price would do it. His prices always seem to be 7-8K.

Re: Competition asks for no $$ down - Posted by patsears

Posted by patsears on January 24, 2006 at 22:49:29:

Hi Todd,
I think I was a little tired and having a bad one that day-sorry, I didn’t mean to offend. I was trying to point out to the original poster that trying to compete with someone who relies on offering nothing down to potential buyers is fruitless-something you apparently know already.

Happy Investing!!!

patsears