8 Best Ways How to Find Subject to Properties
In this article, I will share with you eight effective ways to find subject to properties.
I’ve personally bought over a dozen houses subject to the existing financing. The great part about subject to properties is that you can buy as many of them as you can get your hands on.
However, the key is to learn how to find a subject to property because most homeowners are not willing to sell their homes this way.
I’m going to share with you the ways that I have found these houses, so that you will know how to find subject to real estate deals.
By learning these marketing strategies, you will be able to add properties to your portfolio much faster than you could any other way.
Sounds good? Let’s dig in!
Target the Right Type of Motivated Sellers
Before we get into the details of how you find subject to properties, we need to discuss what you’re looking for.
As I mentioned, most people looking to sell their homes will not be willing to let you take over their loan. In fact, even most motivated sellers are not open to selling this way.
It all comes down to whether they have a house problem or a money problem. Many people become motivated to sell their homes because they have a large financial burden.
This could be due to health issues, credit card debt, or hundreds of other reasons.
But the bottom line is that these people need a large sum of money to resolve their problems, and selling for all cash will give them that.
It will likely be difficult to buy these homes subject to because that type of deal probably won’t meet their immediate financial needs.
On the other hand, many motivated sellers simply have a house problem. In this case, they don’t have a significant financial problem looming, but the house itself is causing them pain.
This could be because the house needs work, or they are struggling to keep up with the payment.
Either way, they would be much better off if someone took the property off their hands so they didn’t have to worry about it anymore.
If you are trying to figure out how to get a subject to home, look for the right types of motivated sellers.
#1 Purchase Subject To Leads
Especially if you are only starting out, you may lack the time and money to build your own marketing system generating leads on a regular basis for you personally.
If you are looking to get leads quickly and get down to business of acquiring property, the quickest way is to buy subject to leads generated by real estate marketing experts.
Real Estate Bees’ lead marketplace is an affordable, convenient, and innovative solution that allows investors to find local highly motivated sellers, including subject-to leads, among other types.
The platform offers a one-of-a-kind program that helps generate FREE and PAID leads for real estate investors and other professionals.
Besides the option to get free leads, it has the following perks:
- Precise geo-targeting capabilities
- Granular filtering ability
- Multiple payment models available
- World-class dedicated support
- Access to resources helping you expand your online presence and establish yourself as a go-to industry expert
If this sounds like something you might consider, learn more about it here.
#2 Driving for Dollars
One of the fastest ways to find subject to properties is to drive for dollars. This involves driving through areas and taking note of any houses that appear to be distressed.
Not only is this one of the fastest ways to find houses to buy subject to, but it is also one of the cheapest strategies because all it requires is a car and time.
The first step in driving for dollars is to come up with an area you want to target.
You want to make the best use of your time, so there is no sense in driving through neighborhoods you don’t plan to invest in.
It also helps to find areas with a higher density of vacant properties.
You can use one of the online real estate investor tools such as PropStream to find pockets of vacant houses and filter them based on your desired criteria, such as price point.
Once you have determined the areas you want to focus on, it’s time to get out and drive through them.
It is best to focus on a neighborhood at a time and go through them methodically, street by street.
As you drive, look at each house and try to find distressed properties showing signs of abandonment. Here are some common signs to look for:
- tall grass
- broken/boarded up windows
- obvious exterior damages such as damaged siding and roof
- notices on front door
- broken down cars in driveway
- lack of personal items
- open windows revealing empty rooms
For saving properties, use one of the popular driving for dollars apps such as DealMachine.
They allow you to see information about a property, skip trace real estate owners, and even send them real estate investor direct mail marketing collateral on the spot in a few taps.
Otherwise, the best way to record each property is to use the voice memo app on your phone since this is much faster and safer than trying to write them down while driving.
Simply speak the address and any details into the recorder. You can then do any necessary research when you get back home.
Once you compile a list of distressed properties, you can contact the owners through any method you choose.
#3 County Records
Perhaps you don’t have the time (or patience) to get out and drive neighborhoods to find houses to buy subject to.
Another option is to look through county records for potential signs of motivation.
Here are some pain points to look for:
- foreclosures
- tax liens
- other liens, such as mechanics liens
- code violations
- eviction filings
The best place to find foreclosures and other distressed properties will depend on your county. Some counties will have this information available online, while others require you to come to the courthouse to find it.
You will likely have to talk with people in the probate office of your county to figure out the best place to pull these records.
Many of these pain points can be found by using platforms such as PropStream, saving you a lot of time.
County records may contain outdated contact information. In this case, you can use one of the skip tracing tools for real estate investors to find up-to-date information.
Just type in the area you want to target and filter the list by motivators such as foreclosure or liens.
Not all county records are available on online platforms, but the ones that are can be obtained with just a few clicks.
However, there will likely be much less competition for the records that are only available through the courthouse, so you can likely find deals easier if you’re willing to put in the work.
#4 Expired MLS Listings
Sometimes, for one reason or another, homes listed on the MLS end up sitting until the listing expires.
One of the most common reasons this happens is that the house was listed too high.
Sometimes that is because the seller has an inflated view of their home’s value, while other times they genuinely need a specific dollar amount from the sale.
The great part about buying a house subject to is that you can typically pay much more for a property than if you were to buy it traditionally.
If you are planning to purchase a home for cash flow and the current loan’s interest rate is much lower than what you could get on a new loan, it likely makes sense to buy it subject to — even if you’re technically paying more than you normally would.
One way to find expired listings is to monitor current listings on Zillow. Most listing agreements last for six months, so if you periodically check Zillow and note the listings that are approaching that threshold, you will know which ones have expired and can contact the owners.
A simpler way to find expired listing homes to buy subject to is to use the “Failed” MLS status in PropStream.
Using this filter will enable you to pull a list of every listing that has expired within a specified time period.
Once you have this list, the next step is to use your preferred marketing method to contact the owners.
#5 FSBO Ads
Many homeowners decide to list their homes themselves, and these listings are called FSBOs (For Sale By Owner).
There are various reasons why people decide not to work with an agent and go the FSBO route.
Some feel confident enough to handle the process alone and save the agent commissions, while others feel they can’t afford to pay an agent.
I can’t sugarcoat it. Trying to find subject to properties by calling FSBO ads can be a grind.
Most of these sellers are trying to squeeze as much as possible out of their house (hence why they are selling FSBO) and will not consider anything but a traditional offer.
That’s why it is important to develop a couple of skills. The first is learning which FSBO ads are worth reaching out to.
A house that looks immaculate and is in one of the best neighborhoods in your area probably isn’t worth reaching out to because it will likely sell quickly if priced correctly.
However, a house that looks a little distressed or has been on the market for a while could be a prime candidate for a subject to offer.
Focusing your effort on these properties will save you a lot of time and frustration.
The second skill you must develop when calling FSBO ads is communicating effectively and working the idea of a subject to deal into the conversation.
Most sellers will shut you down immediately if the first thing out of your mouth is that you want to take over their payments.
That is why it is important to build rapport and ask motivated seller questions to understand the seller’s situation. Only then will you know if a subject to purchase will actually help them.
#6 Real Estate Wholesalers
Most real estate wholesalers specialize in marketing for distressed properties and negotiating deep discounts on them.
While that works in many situations, getting an all-cash offer but having to sell at a discount doesn’t work for every seller.
For example, what about someone with little to no equity, meaning they owe as much on their mortgage as their house is worth?
If they sold at a discount, they would have to bring money to the closing table. The sad truth is that most wholesalers, after putting in much work to generate motivated seller leads, throw many of them away because there isn’t enough equity for them to work out a deal.
What if you networked with the wholesalers in your market and told them you would give them a fee every time you revived one of their dead leads and worked out a subject to deal?
Don’t you think they would happily send you all those leads? Many of them would!
With the help of the free Real Estate Bees directory, find real estate wholesalers in your area.
Alternatively, here are a few more ideas:
- Check your local real estate investing Facebook groups. Many wholesalers frequently post deals there.
- Google terms such as “sell my house [your city]” and “we buy houses [your city].” Many of the companies at the top assign a large percentage of their deals.
- Reach out to investors that send you real estate investor direct mail since most of them are wholesalers.
- Talk to flippers and landlords you know that buy a lot of houses and see if they ever buy from wholesalers they can refer you to.
- Call “We Buy Houses” bandit signs since most of them are wholesalers.
#7 Your Own Website
Most real estate investor websites target keywords such as “we buy houses” and “sell my house fast”.
This means that when someone searches those terms in Google, their website shows up among the results. They get to the top of them by doing real estate SEO.
As you can imagine, ranking at the top of Google for those search terms in a large city generates a significant amount of leads.
However, those keywords are often extremely competitive and take a ton of work to get to the top spot.
But we’re talking about how to find subject to properties, and most of the websites that rank for those generic keywords focus heavily on “making cash offers.”
Sure, there is likely less search volume for terms like “sell my house with low equity” or “sell my house in foreclosure,” but they also have less competition.
To have a website that helps you find motivated seller leads, you must start by designing a homepage tailored to your target traffic.
You should include keywords such as “sell my house,” “low equity,” and “foreclosure.” Next, you will need to write blog articles that go into detail about specific topics surrounding these keywords.
Finally, you will need to build backlinks to your site. Backlinks are when other websites link to yours and are a huge ranking factor.
We don’t have the time to get into link-building here, but check out this guide to building backlinks if you want to learn more.
You’re likely thinking that building a website to generate subject to leads is too much work.
However, I’m sure the companies that rank at the top of Google in your area right now would disagree.
Sure, there is a lot of work involved on the front end. But that investment will pay off tremendously when you begin passively pulling motivated seller leads from your real estate investor website.
#8 Network with Real Estate Professionals
Many real estate investors get so busy with complicated marketing campaigns that they neglect to network.
The crazy part is that I know several successful investors in my market that don’t do any paid marketing and get all of their deals from their network.
So how do you find subject to properties by networking?
Property Managers
One group of people you should be networking with is property management companies. They manage rental properties for landlords.
Granted, many of their clients are likely professional landlords with no intention of selling their properties.
However, they likely have some clients that are “accidental landlords.” That means they wanted to sell their house, but it didn’t sell, and they were forced to rent it out to cover the mortgage.
Most of these people don’t want to be landlords, but it is the only option they know of.
If you stay in touch with several property managers and let them know how you can help their clients, they will likely think of you when they have a landlord that expresses an interest in selling.
Real Estate Agents
Local real estate agents are often the first people homeowners call when they’re interested in selling their houses.
And that makes sense because the vast majority of real estate transactions go through the MLS.
But what about the listing appointments where it is evident that the seller can’t afford to pay an agent to sell their house because they have no equity? What can the agent do for that seller?
If you network with agents in your market, you will be the first person they think of when they run into those situations.
If the homeowner really needs to sell and has no equity, a subject to deal might be their best option.
Make sure you let the agents you talk to know that you intend to compensate them for any deals they send your way that you’re able to close.
The fee you give them is a small price to pay to own a subject to property.
Put In Effort
Buying subject to properties is one of the greatest real estate investment strategies because it is one of the fastest ways to build a portfolio of cash-flowing houses with little money down.
But just like many things in life, the more lucrative an opportunity is, the harder it is to find it.
In reality, it takes work to find subject to opportunities. Most real estate listings don’t say, “Come take over my mortgage!”
However, that truly is the best option for many sellers, but most don’t even know it’s possible.
That’s why it’s your job as an investor to find the sellers that this strategy will actually help and then educate them on the process.
If you use the strategies discussed here, you will begin finding these opportunities in no time!
You will be amazed at the deals you uncover if you put yourself out there and start talking to people.
If you need additional guidance before you start doing subject-to deals, consider taking SubTo course by Pace Morby that teaches step-by-step this incredible strategy. Or, read about other subject to real estate courses.
Good luck finding your next subject to property!
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About the Author
Jordan Fulmer is the owner of Momentum Property Solutions, a house buying company in Huntsville, AL. Jordan and his company specialize in buying houses in tough situations and renovating them to either sell or rent. Jordan regularly shares his first-hand knowledge of the business with other investors through writing articles about real estate investing, home improvement, and general real estate topics.
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