How To Find & Qualify Great Tenant Buyers - Part 1Aug 25, 2021
editors note - this series is from a video I did on our Youtube channel, you can check out the full-length video here
You know how to find and qualify great tenant buyers. whether you've spent any time in the real estate investing world, you've either experienced, or you've heard of horror stories with bad tenants and it's not fun! Everything from not paying rent to ghosting you, to wrecking your property. We could do a whole episode on sharing war stories - titled "Well, You Think Yours Was Bad? Let Me Tell You About Mine!" One day we may just have to do that, it will be like a therapy group, it will feel good to get it off our chests. (haha)
"We've All Heard Horror Stories"
I'm so excited that you're here for this topic before we dive in I want to tell you about our Facebook Group; It's full of value, it gives you the opportunity to connect with people all across the country to engage in conversation around Rent To Own, creative financing, helping, supporting, learning and growing together!
How to find and qualify great tenant buyers, As I was diving into this and thinking about it, it's really two different subject matters, right? You've got how to find them in the first place, that's a whole marketing piece and it's super important. I'm not going to go a ton into that today because everyone's got their different ways of marketing in creative ways. If you want me to do a separate live call just on marketing to find tenants, I will do that. Drop a comment in the Facebook group for that. (see link above.)
"Let us know in our Facebook Group if you would like more info on marketing to tenants"
So let's say that you've marketed already and you're bringing potential clients in, how do you discern if these are good clients or not good clients? I'll give you one example of a client that I thought was pretty good. If you saw any of my previous videos or posts before today I've talked about people with cash and a pulse can be really tempting if your property is vacant. And if you're tired of dealing with tenants. I had this couple, they had really good references. So I talked with their landlord and previous landlord. I prefer a previous landlord. (I'll go into that a bit yet)
"There are things you can do to better discern if they are good potential tenants or not"
As I look back I'm pretty sure that these were fake landlords. I think there were friends posing as a landlord and told me exactly what I wanted to hear. If you ever experienced that, or have you been on the other end where you were trying to get rid of a tenant and you've told a new potential landlord, whatever they want to hear. These are all things that we hope to avoid. Anyway, they ended up being horrible tenants. On the bright side even though I spent thousands of dollars cleaning up after them and months of missed rent, I learned a ton of stuff. I hope to give you some of what I learned through the entire thing and you can set yourself up for success!
"I personally believe there are no faliures, simply lessons learned"
You know, finding and qualifying these tenant buyers, the qualifying can be the hardest part because you have to do a bunch of due diligence, but I promise it's worth it in the end because you don't want to have to deal with these tenants. Two weeks, two months, six months down the road, you want to do the best job you possibly can. So I start by marketing out there and like I said, I wasn't going to go very deep into this, but you know, I've got a website, a Facebook page for my Rent To Own business and properties, Kijiji, Facebook marketplace, street signs, word of mouth, all that sort of stuff. So when they come to me, there's a couple of different ways that they'll come to me. And I go through an initial questionnaire, that they've filled out on my website. (Check that pre-application form out here!)
Now there are 4 key things that you want to know and look for off of this sheet. Very quickly; what their income is, how much they have for a down payment, what the debt looks like, and how much they pay for rent now vs. how much they think they can pay for a mortgage payment. Right away, this will give you a quick picture of whether you can help them and give you a glimpse of how truthful they are. There is more to it and you must do your full due diligence but this is simply the pre-screening or pre-application. You get to that point. From there if they are pre-qualified we have a brief phone call or meeting to learn a little more and from there we have one other form to fill out and then and only then if they pass those first 3 points I give them a 5 item checklist. I explain the program, all that sort of stuff. And then they start from that checklist. They start submitting stuff to me. Right. I don't really do any real work until they've done some work and they've submitted material to me.
"Having a solid screening process WILL save you many, many headaches"
THIS IS THE END OF PART 1 - STAY TUNED FOR PART 2. IN THE MEANTIME CHECK OUT THE FACEBOOK GROUP (SEE LINK ABOVE) AND ASK QUESTIONS, GET INVOLVED.
A wise person once said "to change your life, you MUST change"
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Cam Rowland is a business owner and real estate investor from Winnipeg Canada. He purchased his first investment property in 2006 after reading Rich Dad, Poor Dad by Robert Kiyosaki. In 2010 he shifted focus to Rent to Own. As a result, he was able to grow his real estate portfolio, grow his cash flow and quit his day job! After 100's of successful deals, Cam started coaching others to do the same and now offers a 6-week coaching program. If you're an action taker and want results like Cam, check out this Free Case Study. (click the button below)