Not long ago, skip tracing and direct mail had a battle in the real estate colosseum. Skip tracing won. But, many tried batch skip tracing for real estate and returned to direct mail after struggling to get the results they’d hoped for.
Why did this happen? How did the skip tracing train get derailed?
Even though skip tracing is faster and more efficient for getting motivated sellers and cash buyers on the phone, you still have to do it correctly. Otherwise—just like direct mail—it won’t work.
So, how do you make skip tracing work? What’s the secret to replacing or supplementing your direct mail efforts with skip tracing?
That’s what we’re going to talk about. But first, let’s talk about why should you use batch skip tracing for real estate, because we understand your skepticism.
Why Use Batch Skip Tracing for Real Estate?
If you’re not familiar with skip tracing, it’s simply a way to find someone based on a minimal amount of information. Debt collectors, repossession agencies, private investigators, and other businesses frequently use skip tracing to find people, especially those who are avoiding being contacted.
For real estate, skip tracing is a bit different. All you need is a phone number or email. You’re not serving process papers or anything. So, people usually won’t be hiding from you (hopefully).
This makes it possible to conduct skip traces for real estate in bulk. You can generate a lot of leads very quickly.
Now, is skip tracing better than direct mail? In many ways, yes.
Direct mail is tried and true. It will probably always work for real estate wholesalers. But, skip tracing can be more efficient and effective, if you do it right. Also, it’s not an either-or situation. Using a combination of direct mail and skip tracing is a totally viable strategy.
But, here’s why skip tracing for real estate is amazingly efficient and effective.
Often, people compare skip tracing to direct mail on a one to one basis. If a skip trace costs a dollar and a direct mailer costs a dollar, the cost must be the same, correct?
Not quite. It usually takes multiple touches to get a response from direct mailers. Some say it takes seven touches to get a lead from direct mail contact. However, even if you get a response in four touches, that’s still four dollars per lead from direct mail.
With skip tracing, you pay for the information once. Then you can call or email as many times as it takes, at no additional cost.
So, batch skip tracing is less expensive, when you consider the entire cost of generating warm leads with each method.
Speed to Contact
How long does it take for direct mail to arrive? At least a day or two. Maybe up to four or five days.
Then, how long does it take a potential seller to call you back? If they’re really motivated, it could be the same day they receive your mailer. Or, they may wait until your second, third, or fourth mailer arrives.
With skip tracing, you can get in contact with people the same day you get your list of potential sellers. Often, a bulk skip trace will get you phone numbers in a few minutes. Then, you can start cold calling almost as soon as you get your list to the office. So, the chances of losing a deal to another wholesaler drop dramatically.
The easy sales always get snapped up first. Which is why they say the money is in the follow up.
Using direct mail, there’s only one way to follow up if a person doesn’t call you back: another mailer.
But, if you get a phone number or email from a batch skip trace, you can set up an email drip campaign or follow up with another phone call. In short, you can pursue the tougher leads until they convert.
You send direct mail to get people to call you. So, the ultimate purpose of direct mail is to get people on the phone. The more people you get on the phone, the more deals you’re going to make. That’s the bottom line.
If people don’t call you, you’re not going to close any deals.
Skip tracing gets people on the phone. Therefore, skip tracing gets better ROI. There’s no way around it.
How to Use Batch Skip Tracing for Real Estate Wholesaling
You can use skip tracing to put together entire deals. Meaning, you can find both buyers and sellers with an almost entirely automated process. All you have to do is talk to the buyers and sellers.
The skip tracing process is the same, whether you’re finding buyers or sellers. This is the universal process. Use it on lists of sellers or buyers.
As a real estate professional, you’ll usually start with a list of names and addresses. This could be from a vacancy list, code violations list, or something else (you can buy real estate lists at Listsource.com). In any case, it’s most common to start with names and addresses.
If you have a list of addresses without names, that’s okay. You can use batch skip tracing to get the names for your list.
First, you need your list to be in the right format. Most batch skip tracing services require your list to be in one of these formats:
- Microsoft Excel
If you buy a list, it will typically come in one of these formats. Usually, you won’t need to worry about converting the file type.
Use a spreadsheet editor to put each piece of information into its own column. For a real estate list, this means that you’ll have a column for each of these pieces of data:
- Physical address
- Zip code
Some lists may not have the county. But, it’s not necessary for getting contact information. No worries if you don’t have it.
Once you have your list structured this way, you’re ready to start your skip trace. These are the steps:
- Upload your list to a batch skip trace service, like Searchbug.
- Select the information you want the batch skip trace to find.
- If you have just a list of addresses, first do a batch skip trace to get names. Then, upload the list of names and addresses for a batch skip trace to find phone numbers and email addresses.
- If you have a list of names and addresses, select phone number and email address as the information you want the batch skip trace to find.
- Get your results.
You’ll usually get results in a few minutes, depending on the size of your list. If you upload a HUGE list, it may take longer.
Most batch skip trace providers will send you an email when your results are ready.
Now, you’ll have a list of phone numbers and email addresses. You can begin cold calling these, if you want.
However, some entries will likely still be missing phone numbers or email addresses. Here’s how to finish off your list:
- Use your spreadsheet editor to pull out the entries that are missing info, and add them to a separate list.
- Run this separate list through a more thorough batch skip trace.
If your batch skip trace provider has an enhanced batch skip trace service, like the Searchbug Premium Append Service, run your list of entries that are still missing phone numbers and email addresses through a premium search.
Now, you’ve gotten the most phone numbers and email addresses possible. You’ll have plenty of prospects to contact. This process works for finding both buyers and sellers (which we’ll cover in more depth further on).
Tips on Using Batch Skip Tracing for Real Estate
Like any tool, there are good ways and bad ways to use batch skip tracing for real estate.
The main reason people try skip tracing, then run away from it, is because there are a few places where you can take a wrong turn. It’s not as dead simple as sending out mailers.
Here’s how to ensure that skip tracing works for you.
Don’t Go Cheap
The old advice that “you get what you pay for” holds true for batch skip tracing services. There are a lot of companies offering free skip tracing or super cheap skip traces.
However, free and discounted skip tracing services usually don’t provide quality data. The phone numbers and email address you get will often be out of date or disconnected. Or, they may not find any information, but will still charge you for the search.
If it sounds too good to be true, it probably is. A skip tracing service that offers searches for a penny a phone number (or maybe less!), is most likely not going to build you a reliable list.
You can get dependable data for about 15 cents a hit. It might cost a bit more. But, the value of having a list that you can actually use is absolutely worth it.
Never Call Numbers on the DNC List
The DNC list is the “DO NOT CALL” list. Never call a phone number on the DNC list. It’s called the “DO NOT CALL” list for a very good reason: because the owner of the phone number specifically requested not receive unsolicited calls.
So, you’ll need to cleanse your lists of any phone numbers on the DNC list. Run your lists through a phone validator to find out which numbers are on the DNC list, and use any spreadsheet editor to quickly remove them.
This will protect you from getting into any serious trouble with batch skip tracing.
Use an Autodialer
One big difference between direct mail and skip tracing is the sheer volume of phone numbers you’ll work with. You could easily get hundreds of phone numbers from running a single batch skip trace.
So, you need to make the cold calling process more efficient. Even if you hire a team to do the cold calling for you, an autodialer is mandatory. Converting your cold leads into warm leads is just too time consuming without an autodialer.
Hire a Virtual Assistant
The logistics of skip tracing are a bit more complex than direct mail. With direct mail, you simply send your list to your direct mail contractor and write a check.
Batch skip tracing requires that you run a skip trace on your lists of leads, remove the numbers on the DNC list, and add the list to your cold calling system. So, there are a few more moving parts in skip tracing.
However, everything you need to do is very simple. A virtual assistant can easily do all of it. This way, you can focus on converting the leads and closing the deals.
If you outsource the skip tracing and list management, you can scale your real estate wholesaling business very fast, without even getting an office space.
Use Batch Skip Tracing to Find Buyers
If you streamline the process of finding motivated sellers with skip tracing, you could very quickly end up with more sellers than you have buyers for. This is a tough spot to be in when you’ve got several houses under contract.
That’s why your process for finding buyers needs to be just as efficient as your process for finding sellers. There’s a simple way to make sure this happens: use skip tracing to find both buyers and sellers.
Here’s how use skip tracing to find buyers:
- First, you’ll need a contract for a property to wholesale. You need a seller before you find buyers, right?
- Identify the zip codes where people who are likely to invest in the property live. Usually, these are the zip codes for the areas surrounding the property for sale. Or, if you know that people from certain, more distant areas would be interested in investing in your contracted property, you can collect those zip codes as well.
For example, people from the San Francisco and Bay Areas often buy properties in Nevada and Arizona as rental investments, since the property values are so much lower. So, you might get zip codes for the San Francisco and Bay Areas if you had a property in those neighboring states.
You can find zip codes easily using a simple zip code search, like the Searchbug Zip Code Search.
- Buy a list of potential buyers from a list provider like Listsource. To find potential buyers, get a list of people from your target zip codes who have purchased real estate in the last 6 to 12 months.
You’re looking for cash buyers. So, buy a list of buyers who purchased with “NO LIENS” or “100 PERCENT EQUITY.” These are your cash buyers. You know this because they made their last real estate purchase without getting a loan.
- Now, you’ll have a list of names and addresses. Do a batch skip trace on the list to get phone numbers or emails (or both). You’ve just built a list of potential cash buyers to cold call or email about your contracted property.
If you plan on sending emails, you should verify the emails you get. This will reduce your bounce rates and improve your other email performance metrics, since you won’t be sending to dead email addresses.
- When you call or email potential cash buyers, focus on finding out when they plan on investing in another property. If they’re not ready to buy soon, just ask if they’re interested in being added to your potential cash buyer list to be notified of future investment opportunities.
That way, you’ll either find a cash buyer who’s ready to buy now, or you’ll grow your list of potential buyers. It’s a win-win.
Closing the Deal
So, that’s it.
That’s how you use skip tracing to find both buyers and sellers, and create lists that get you the volume you need to hit those huge sales numbers every month.
Of course, you can use Searchbug to do all of your batch skip tracing in one place, and build complete buyer and seller lists in a matter of minutes. Then, all you have to do is make the calls.