The 3 Phases of Pre - Foreclosure with Pace Morby | Wholesale Real Estate

0:01 [Music] let me just break this down so you've got um the first phase second phase and third phase yep okay what happens in um you can stand by the tv and talk to the camera there you go i'm learning about technology guys there you go all right the team is on me i love it i freaking love it oh wow this is so legit it's almost like you guys know what you're doing around here it's amazing okay so you've got three phases phase one phase two and phase three what most people think is they think oh well there's no you know these people have a lot of equity they're gonna they're gonna sell to a realtor they're gonna do one of those things guys it is not true this is what

0:47 happens the majority of the opportunities are in section three and or i'm sorry phase three and phase one can they hear me if i'm talking like this yeah they still hear you okay cool so here's what happens phase one they get the letter for the first time they get the letter what do you mean by letter so they get a letter notifying them hey we have taken notice that you're late on your payments this is going to get serious for you you don't have an auction date yet but you're we're noticing you we're putting you on notice and guess what that letter does is it goes on public record right okay now it's public record everybody in the universe now knows that this person's in pre-foreclosure when this happens this is typically

1:32 when data companies grab these lists and they organize them so that you know they can come out daily every single day you're getting new free foreclosures that are popping up in your market and that's why what's happening it's phase one which is the notice right so here's what happens if you have this is phase one yep phase two and phase three yeah in phase one here's what we do we immediately text and we door knock these people yes okay we text and door knock them and here's what happens can we can we get any feedback can people hear them yep okay good hail yeah they can all right so you've got they get a letter yep they now say oh no this is their main thing is you say oh no these are people that have true distress

2:20 okay the people that say oh no they consist of 30 of the sales happen right now in phase one so here's what happened they get a letter and then one of the first couple of investors they talk to or realtors ends up getting that deal sold yeah that's 30 of people so let's say 100 letters go out 30 of those people will sell once they get that letter right 30. it doesn't matter if they have equity no equity what have you by the way you've bought a lot of foreclosure deals and you've fixed and flipped them or you've wholesaled them they have a lot of equity yeah so equity in my opinion not in my opinion my expert expert opinion is that equity doesn't matter in these situations these people have pain right

3:05 okay so what happens is 30 of the people receive a letter and they go i need to do something right now this is gonna get serious right then phase two i call this the ostrich phase yep okay can you tell people what that means by the way i i think that this is really important to notice here the two strategies that you talked about are uh going to the door or sending a text message right and i couldn't agree with you more because these guys right here in this phase and i'm not joking here to everybody they probably get between 12 to 25 calls a day all right so when you when you're looking at how do i get through how do i have that conversation with somebody you either gonna get face-to-face or you have to do the texting because a lot of the companies that are calling them are

3:51 real estate agents uh they are the the mortgage companies themselves there's some like loan you know modification companies that start calling them like it starts going real fast real heavy real quickly when you're getting 25 calls from unknown numbers every single day you shut down yeah a lot of times we see when we go knock on the door yes what we find is that these people have actually turned their phones off yeah well and in my in the ttp coaching i don't coach the cold call pre-foreclosures smart i don't because you got to go to those doors and you got to text them and that's the only way or if you're afraid to knock a door sticky no sure right do us put a sticky note on their car put a sticky note in the door like hey i'm in the neighborhood i'm a real person i'm not here because you

4:36 know what happens is what you're talking about is if people are calling them a lot of them are collecting trying to collect a bill right if they're behind on their house payment what else are they behind on mm-hmm all their uh other things and let me ask you when you because the question is going to come up and we'll we'll address it in a little bit more we'll tear it apart but what are you telling people to text here okay are you telling to to talk about the pre-foreclosure not yet what we do is we just say hey saw your house want to know if you're open to sell it love it that's it just keep it simple yeah and then what happens is we do a trickle campaign like five to seven days later okay specifically for foreclosures and we then ask them a question that will lead into our eight things later in the show which is are you trying to keep your house we have ways of helping you we'll get into all that we'll get into all that let's go through the phase okay

5:22 so what happens is there's 30 percent of people that are just like amazing people that are worried that they are behind on their bills and that really is a sense of pride for them they immediately solve their problem by selling the house through a realtor or an investor right away right within 30 days this right here how long is this phase 30 days 30 days 30 days so put it real big here yeah 30 because this is really important the reason i ask that question guys is when you're looking at when were they noticed they will show you on on these apps and on these lists what the notice date was when it went out that 30-day window you got to remember you're here so you got to say okay if i only have an hour a day to commit to this business because i got a full-time job i've got young kids i've got school i've got other things right

6:09 you want to be going after it here and here right yes right here and here so if you the efforts the filter this is really really key guys i'm telling you the effort that you put in is in the first 30 days and then in phase three and we'll get to it perfect so here's here's the thing is about 10 of people sell during this phase okay it's very small however this phase is much longer it's about 90 days okay this phase is a lot longer and what are these people doing during this time frame they are ostriches they're putting their head in the sand they're hiding from what's going on they might be trying to do a loan mod okay they also might they you'll knock the door you'll text them and go we got it taken care of this is like the most common thing we hear got it taken care of right i got it taken care

6:55 of okay well do you have a realtor what do you got don't worry about it i got it taken care of okay i've got a great story i'll tell you about one of my favorite deals where we knocked this door here and we skipped all of this and we knocked the door again here and that's kind of the strategy we do right we primarily avoid these people in this phase other than just a trickle campaign of following up how's it going are you okay anything you need you got the kids got food like we'll buy groceries for people seeds yeah plant seeds this is plant and seeds i'm not doing i'm not getting any contracts really in this phase but i'm setting myself up for this is the biggest one this is about 60 of people sell in phase three this was the oh no face this is now the

7:42 oh face this is now i didn't solve my problem my loan modification didn't work my agent tried to sell my house for me i couldn't get the number i thought i could come up with the money i i asked my brother and my brother told me he was going to get me a private loan to catch up my payments and i had to get another whatever it is that they think they're trying to solve during this phase doesn't work out they go o m g omg i gotta do something right away and now these people become let's use the word amenable okay a lot of people don't know that means it just means now they're agreeable okay so i've got a seller 17th ave just right down the road when you knock on his door actually i'll

8:28 quentin tarantino you real quick yeah so what happens is i um three days before foreclosure three days before foreclosure my team matt beard who you know yeah calls me up he goes pace i got a live one i need you to come down and explain what we're gonna do to this guy matt was just new to the business at the time so i drive down to 17th ave and i go inside the house i sit on the couch and i explain to the guy here's what we can do to help you out we got three days yeah what we'll do is we're gonna postpone the foreclosure we're gonna give you an extra 30 days in the house we're gonna do all these solutions which we'll we'll teach you guys about that stuff as well and this guy said his name's grant and grant goes where the hell were you when i first got my letter of default where were you where were all these solutions and i said bro you don't remember me but i knocked on your door

9:16 120 days ago provided the same solution to you you made fun of me because i was wearing cargo shorts that were camouflaged and you asked me if i was in the army he goes holy that was you i go bro you weren't ready to listen to me right you were simply not ready to listen to me and so what i want to impress on people that are in this business is they hear no one time and they go that person is never going to sell to me right guys oh my gosh you have to understand that you have to massage and plant seeds with these people that is a house we ended up buying that house subject to which we don't need to go into creative finance today but we end up buying that house subject to and it's a house that we make probably fifteen hundred dollars net on every single month that was three years ago yeah i made 40 plus thousand dollars in cash flow in that one house because we

10:02 followed up and we stayed on top of it so that is the majority of people they forget because there's so many people hitting them up here they forget who they were even talking to and i think i think it's important here this this phase here when it gets real close to the auction date right you need to the conversation let me honestly honestly the the conversation that you need to have is well go over here cause your head's in the way uh the conversation that you need to have is we can get this postponed if we have a commit if we have a committed contract if we have the paperwork put together we can go to the trustee we can go to the auction we can go and postpone this auction they do not want to do this auction they do not want to pay the cost

10:48 they don't want to take the property back they will typically work with you to get that postponement but you need to get those people committed on paper that's the point so here's here's what i've had happen i've had students where i go all right guys we can show you how to postpone a foreclosure and i then train people how to postpone a foreclosure what they do instead of getting the seller committed they go extend the foreclosure for the seller and guess if you don't have the seller in a purchase contract before you extend the foreclosure which you can do it without a for a contract guess what you just did you told the seller it's okay to go back to this phase right here you've just given them permission to go back to the oh the oh i don't care about it phase

11:34 the ostrich phase i got it taken care of i got it taken care of you just you just bought me 60 days okay so you've got to get them into a contract and then you can help them out love it let's go through the eight things and then hold on before we move on um there's a bunch of questions about these phases hell yeah there are alejandra shout out alejandra guys guys guys we're going to go through the eight different ways that you can help solve them but let's get into these questions alejandra's telling us that we need to get to some of these questions while we're here john ttp when do these phases happen timeline so this is the first 30 days so well here let me let me be really clear with you guys real quick there's two different types of states okay there's judicial states and there's non-judicial

12:19 states and you guys can google this i'm not going to break this down because i haven't memorized them the majority of states in the united states are non-judicial right okay and what that means is that the bank doesn't have to foreclose on me through a lawsuit right they can go directly to a trustee and a trustee is a law firm that uh bank can hire and go you know what we're taking we're a bank we're not in the business of taking houses back we're going to hire a professional to take our house back for us and that person stupidly i don't know why everybody in real estate has got to change put these names really really challenging they we should call them the taker backers they're going to take the house back they're the trustee that's their job they take the house back on behalf of the bank and the bank makes them charge

13:06 you a fee so if you're the person getting foreclosed on the trustee is going to charge a minimum of five to seven grand immediately just the second they get hired okay so in non-judicial states the bank hires a trustee and the trustee handles all of these phases okay all these phases are handled by a trustee in non-judicial states in a judicial state you will the um the bank has to go and actually go to a judge in a foreclosure there you go perfect you've got it i'm going to do judicial states actually love it there's great maps on online judicial versus non-judicial this is great great that i love you're doing this because a lot of people are not resourceful enough to just have done this themselves let me see maps

13:52 if that'll do no no go there's a website actually if you go back down there's a great website um go down the one that's um anyway keep going yeah yeah okay cool he's finding it guys so depending on the state that the the timelines change per state and i know you don't want to hear that you're gonna have to do some homework guys everybody on instagram live guys on instagram live i've got 60 people on here you guys need to go over to youtube so you guys can see and network with the other people okay i want to see these numbers on instagram live go down go to youtube.com forward slash uh or just go into youtube and type in brent daniels you guys will see the live stream so every state is different pop that up man okay every single state is different okay you guys will see in the yellow

14:38 states um this state this one's a little bit interesting yeah because you've got um some states can do both ways right okay so look at the yellow and the red look at the yellow and the red is the same exact thing um blue are the uh judicial okay florida for example this is why it's if you're a fix and flipper and you're trying to get money to do your fix and flips in florida from a hard money lender it's really challenging to get hard money lenders to give you money in florida because they know that if you default as the fix and flipper they have to sue you to get the house back they have to go and actually go to court to get that house back so that's the difference between judicial and non-judicial well this conversation comes up a lot with wholesaling because if you want to do a virtual

15:24 wholesaling and find out where the most cash buyers are going to be they're going to be in the states typically that are non-judicial that is because there's more capital available there and there's more people that can get that capital so that's such a great point and jamil talks about that all the time it's a great point it's not a deviation it might seem like a deviation but you need to understand this the process in which a bank will a home loan they'll get the home loan foreclosed on it all comes down to whether you're in a judicial or non-judicial state so in arizona for example they actually get a notice of defaults in 31 days right now okay so if you're 31 days you get a letter and go hey you're behind yep you're behind it's not a notice of default quite yet it's just a notice

16:09 you're being put on notice you're late pre-pre for closure it's pre-pre-foreclosure there you go that's 31 days they get a letter they know they're late okay guys then what happens is on day 90 that's when the bank goes dude three months we're gonna go hire a trustee and so what they do is they then hire the trustee and i've heard a lot of people go hey i reached out to the bank to try and negotiate with them and the bank won't talk to me do you know why the bank won't talk to you it's because they already hired the trustee and they've washed their hands of the situation and they go call the trustee pay them their five or seven thousand dollar fee and then we'll reinstate your loan they the bank is not in the business of taking houses back the trustee and the courts are so look at that differently the bank

16:56 and the court system and the the trustee they're two separate entities and so when you when somebody's in foreclosure what happens is the sellers get very confused they don't even know who they're talking to anymore and that's where you can step in provide a lot of value and go let me handle these conversations for you so when do these phase and phases happen phase one they get a pre-pre-foreclosure letter on day 31 letting them know on day 90 they are now noticed that they are in default they are in technical default on day 90. is that 90 days from the auction day no no no they haven't even named the auction date yet okay so what happens is you get another you get an nod nod notice of default and then you get an not letter which is notice of trust detail and that's the

17:42 date that you're that's when you get a letter that tells you what date your your auction is because what happens with sellers okay when they get on phase one what'll happen is when they get that nod letter it doesn't have an auction date on it and so they don't take it that seriously and that's what forces them into the ostrich phases like well i don't even have an auction date and in a lot of these letters it will actually state we will let you know when um when your auction date is set we're still basically we're still working on that we'll let you know so 60 of those people are going to go into ostrich phase or 70 of those people are going to go through that phase because they're like it's not that serious it's not catch up you're right it's not until now here's the thing is the ostrich phase lasts about 60 days 60 to

18:30 90 days okay depending on okay depending on the state ever again every state is different 60 to 90 days now texas you know how fast texas's foreclosures are start to finish a fork in texas you can foreclose on somebody in less than 45 days start to finish okay so every state's a little bit different we're not going to go through state by state you guys need to do some research on that for your own individual state but then so the oscars phase is 60 to 90 days that during that phase they then get an n-o-t letter they get a second letter and then guess what happens they get a freaking stamp put on their garage or a letter glued to their front door that their neighbors can now see public notice public notice here and it's what it is

19:15 is the notice of trustee sale gets posted on the house itself are we talking too much are we doing all right okay good [Music] how do you know what phases everyone how do you know so if first and foremost go to your state understand your state laws okay that's the challenge with most people is they want the information given to them they don't want to go actually look for it guys i'm sorry you got to learn how to be resourceful okay you have to be resourceful go to google and type in arizona trustee laws or trustee phase and you'll see the face okay now

20:00 how do i know what phase they're in it's public record it's public record every time there's an update on it it goes to public record or you guys can go to batch driven we show the updates in the app you can also go to uh pre-foreclosures or foreclosures daily do you guys have a discount code for that ttp ttp yep a lot of i see a lot of people in the ttp program like in the ttp facebook group talking about how they get their foreclosure updates from foreclosuresdaily.com um so make sure you use the discount code for ttp okay guys the first 30 days that that notice comes out that is when that that's what they're talking about and and what what i've seen is this really gets ramped up if it's the notice of uh the trustee auction when they have a

20:46 date in mind this is when this like really starts to go it goes right here right here on notice of trustee they get the letter somewhere in this second phase okay guys and once they get that that has now crossed the line to now oh the bank is serious am i allowed to say on the show i i think you've uh said it i don't know 15. daniel you editing me as i'm saying it so okay guys that's what happens once they get the not and they get a they they see that the bank is serious and the trustee is serious serious enough to hire a physical human being to go to your house and put something on your garage door i can't tell you how many times my uh door knocking team will send us a text

21:31 and go we got it we got a garage door letter we got we got the the stamp of approval here we go one of my team members used to call it the scarlet letter okay it was it would they would make it so public that their whole neighborhood now knew that they were in default by literally taking a piece of red duct tape and duct taping it to their garage like so aggressively now you can't just take that sticky note off it's not a sticky note it's been duct taped to your freaking house that is literally every edge yeah every edge it's so hard to get those things off so just just to make this simple and just the first 30 days when they get that notice and the last 30 days before the foreclosure hits that's your prime time prime in between time there that kind of gets extended depending on what state

22:17 you're at obviously it's gonna be shorter in texas but i think texas has different like they can come back and it's a whole thing and and repay it anyway um yeah it's called the redemption period right and it's like less than four percent of people ever redeemed their house third the first 30 days in the last 30 days when you're looking at it and you're getting the data look at when was the notice made am i in that 30-day window and when is the auction date that they're saying in that 30-day window that's going to help you okay if it's in the in between you can plant seeds but don't get your expectations high that they're going to respond to they've got a lot of different things that they can do they've got eight things essentially that they can do um and we can break all that down if if we're ready to move forward to those eight things okay so guys this this can i jump on i have a seller call i want to

23:02 show you just real quick it was yesterday it's a deal i closed foreclosure okay the lady got her nod letter nod she notice of default okay and you will hear her voice at the end of this call just barely happened which is why i'm bringing it up i wouldn't normally just bother you guys with some annoying stuff okay so tell me what's going on um with you guys have a medical emergency um yeah we um both got kobe and he passed away september 19th of this year i'm so sorry to hear that okay so that's the beginning of the call here's here's what happens at the very end of the call um it's about a nine minute call that's how long it takes to close it or close the deal guys nine minutes this is my first call with her by the way you'll have my name you'll have my website all that kind of stuff in there

23:47 as well i just sent it thank you so much i really appreciate this that's my job this is why people call me thank you no problem don't don't cry until we get it all done then you can give me a hug and you can cry okay okay well where do you what city are you guys in right now okay so one one last thing uh taking care of in a couple of days thank you you're very welcome thank you for reaching out i appreciate you thank you bye bye-bye guys so let's go back through the phases one more time what phase is that that was yesterday that was yesterday what phase is she in she just barely got the letter she's in phase one yep and i'm gonna tell you that the people who are so embarrassed about their situation

24:33 they they're very prideful of like i've always paid my bills i've always taken care of things the 30 of people that get put into foreclosure process that sell that's what they sound like they are embarrassed they are so grateful for your help those are the people you're looking for in the first 30 days the hot people that are like please help me please help me please help me if you don't get that response in the first 30 days um what happens is you just put those into long-term follow-up and you wait until the final 30 days because what they're going to do is they're either going to be pri very prideful of like i'm embarrassed i i'm proud of the fact that i've always paid my bills or b they're going to be an ostrich that you have to follow up with okay through phase two and phase three this came from

25:18 where did this lead come from driving deals bro and this is from batch driven that's driven texas text message and then and when that came in what was that on a list or were you driving you saw the property foreclosure literally like it was a foreclosure on batch treatment and that's that's when they actually get the notice that they have a date right this isn't just no no no no they're she's just behind she's not doesn't have a trustee statement this is pre-pre-foreclosure this is she got the letter so she's technically in foreclosure she got the notice of default okay so she's got that first letter that now becomes public record right the notice of trustee is not until the last 30 to 45 days so she hasn't got she hasn't gotten an auction date yet yeah she's only got the noticing ladies and gentlemen in batch driven it doesn't have the auction date not yet for her okay there

26:05 are as as the lead get progresses down the pipeline it will then update the auction so then do you have people go out just after these notice of the difference oh yes my so here's what my team does is we go we focus on people that have been noticed of default in less than seven days right right yep less than seven days and for a while we were oh how do you i'm just gonna pepper you here yep uh how how much volume is that typically in one market okay so you know what i mean because i before i'm looking at these numbers these numbers don't seem huge it's 0.3 percent of people are in foreclosure the thing is these are the people with the most pain right okay just because i lost my job or i'm getting a divorce or i'm filing bankruptcy none of those things none of those pain points mean i'm losing my house right foreclosure is the only pain

26:52 point that means somebody has noticed me that they're taking my house where my kids sleep where my wife and i make love i'm losing my house it's the only pain point that you will ever have that they are actually being noticed that they will lose the house so you don't need a lot of foreclosures to be highly successful right okay right that's what's important this is a quality over quantity for sure all day long so when you see these headlines saying that there's a surge and it's still at historical lows in the same breath there there's not that many to go after i listen i want you guys to get some big quick wins i want you to get some income coming in so i always i would i would advise you i'd coach you to filter out

27:38 the ones that have equity all right now there's other options we're going to go through it if they don't have equity but the ones that have equity that are in pre-foreclosure that you can go and lock up and maybe they have some wear and tear on them maybe i like them built before 1990 i'd like them owned for at least seven years i like them having some equity in there you would assume that there's equity in there because they've owned it for seven years if they didn't pull out all the equity it's there and this comes down to in some markets we're talking 50 to 100 to 150 properties in the whole market that fit that criteria but you become obsessed with those and at least have a conversation by going to the door or texting them doing whatever you can dming them if you can you know just finding them find some way to break that barrier of communication you can do a lot of deals if you like

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