Tools and strategies for skip tracing real estate – Ultimate Guide
Real estate investors, realtors, and even debt collectors use skip tracing to find the contact information of property owners or debtors who may be in default.
It’s a powerful marketing tool that many real estate professionals will use to track down someone who is hard to reach to make an offer to buy their property or list it for sale.
But first, we should start with…
WHAT IS SKIP TRACING?
Skip tracing is the process used to find a person’s contact information by searching a variety of public and private sources.
In the past, skip tracing was a profession, and it was mostly used for debt collection or to find someone who has tried to disappear.
Most people are looking for phone numbers when skip tracing, but a skip trace can uncover ANY contact information for a given person such as mailing addresses, emails, social media profiles, and sometimes even family members or employers.
Skip tracing can be more difficult if the property is held by an LLC or Trust because those entities are created to shield the identity of the true owners.
While it is possible to skip trace a single person, real estate investors will usually pull a targeted list of property owners and run their skip tracing in bulk.
Quick and easy ways to Skip Trace
While we’re on the subject I may as well share 3 of the best skip-tracing services I’ve found in our research…
1. BatchLeads – Easy to set up and skip trace in bulk, very accurate data.
2. SkipForce – Slightly higher cost but pulls in some exclusive carrier data.
WHY DO REAL ESTATE PROFESSIONALS USE SKIP TRACING?
When an investor is trying to buy an off-market property, there are very few times the owner will paste their contact information on a sign and stick it in the front yard (Outside of For Sale By Owner, or FSBO homes, of course.)
So real estate investors rely on skip tracing to help them make contact with property owners.
Making contact with them is the first step to purchasing properties directly from the owners.
Here’s a list of ways to use skip tracing:
1. Buy a list of “foreclosure” leads from Propstream, and skip trace to find their numbers to cold call or text.
2. “Drive for dollars” and send a handwritten postcard after skip-tracing the owners.
3. Skip tracing your “Return to Sender” mail and call them.
4. Skip tracing the hard-to-reach people to find alternative contact numbers.
5. Finding buyers: Wholesalers can find the top flippers and cash buyers in their market.
IS SKIP TRACING ILLEGAL?
When contacting someone you’ve skip-traced, most people are shocked to learn their data is widely available and may threaten a lawsuit.
Rest assured, skip tracing is legal in all 50 states across the US and Canada as long as the data is not acquired in an illegal manner.
Just because skip tracing is legal, make sure you are conducting legal business and being honest about your business intentions.
Always check your state and local laws for additional telemarketing laws or regulations.
In Canada, you may not use skip tracing for debt collection without hiring a licensed collection agency.
IS SKIP TRACING EASY?
Compared to the pre-internet days, it is extremely easy.
Like most things these days, you can do it from your couch in your underwear if you want to.
Public records searches are available online, and some of the skip tracing tools out there have desktop or mobile apps as well.
CAN YOU SKIP TRACE SOMEONE FOR FREE?
These days, skip tracing is more about searching digital databases than doing physical detective work.
Some public information is available for free, but most of the dedicated data services cost money.
Most local governments have moved their parcel searches online, so simply finding the name of a property owner can be done easily and, in most cases, for free.
There is one free skip-tracing option, but it does have a couple of drawbacks.
First, it’s difficult to pull data in bulk, which makes it more suited to pulling just a few records at a time.
Secondly, some people who don’t have a strong digital footprint may have outdated or inaccurate data.
The paid solutions often have more robust and accurate data, because they’ve paid for their data and take organizing and cleaning their data seriously, like the software products mentioned above.
But, we’ll share with you a youtube video on how to skip trace for free:
HOW MUCH DOES IT COST TO SKIP TRACE?
Skip tracing isn’t very expensive anymore.
With many providers and a mountain of data available to them, paid skip-tracing services are very reasonable.
As you can see in the table below, the price ranges from about $0.05 to $0.14 cents per record.
BEST SKIP TRACING TOOLS (2023)
|Cost per record||10-14 cents||5-9 cents||10-12 cents|
|Bulk skip tracing|
|DNC Registry check?|
|Only pay for matches|
|Click here to learn more||Click here to learn more||Click here to learn more|
There are a lot of skip-tracing services available, and most are pretty good. But these three listed above are our favorites because they combine list building and lead generation with skip tracing and other services.
We love these based on how easy they are to use, the quality of the data returned, and their overall cost.
In no particular order, they are:
1. PropStream — They can pull specific lists of properties using a variety of property filters to help you find the types of sellers and properties you want to work with. PropStream can also help you run comps using actual MLS data in hundreds of markets across the country. Skip tracing is available as an add-on inside the PropStream app with just the click of a button.
2. SkipForce — is another prospecting tool for finding properties and owners who fit a set of customizable criteria. But what sets SkipForce apart is their ability to provide a Number Quality Score directly from the carriers, which tells you the type of line (wireless or landline), the level of usage in the last year, and usage in the last 2 months.
2. BatchLeads — can build lists with the standard property filters, and you can set up SmartLists to alert you when a new property matches a certain set of criteria (and remove properties when they stop meeting those criteria). Batch Leads also integrates with their other products: BatchDialer and BatchDrive
HOW TO BULK SKIP TRACE (without losing your mind)
Before skip tracing, you need to create a list of properties you are interested in marketing to.
This can be a list of a dozen properties you found while driving for dollars or a list of 1,000 bored landlords you pulled from a data provider.
Once you have your list, you’ll load it into a spreadsheet and then upload that spreadsheet to your skip tracing provider.
The providers will try to skip trace every contact on your list, but not every contact will return a result.
How these failed contacts are handled and billed varies by the skip tracer, but most will return a list of “hits” (records that returned contact information) and “misses” (records that were unable to be found).
With most providers, that’s it. Make sure to mark the “misses” in your CRM or spreadsheet and follow up with those properties using one of the next steps below.
The harder the property owner is to contact, the bigger the opportunity!
NEXT STEPS AFTER SKIP TRACING?
Skip tracing isn’t that difficult, but it’s just the first step. The next step is marketing, here are some of the most popular methods you can use to convert your skip-traced records into sales.
(For tips on marketing and REI, check out this article called “15 real estate investing tips”)
Which steps you use, and the order you use them, depends on your preference and how many leads you are working with.
1. Cold calling: This is nothing more than picking up the phone and calling the property owner. This works great for starting out or is necessary if you’re investing remotely. Cold calling is a great way to build up your skills for talking with people and is much more effective than a cold text. But people are becoming less likely to answer unknown phone numbers, so be prepared with a script for cold calling and leaving voicemails.
2. Cold texting: similar to cold calling, cold texting is when you send a text to a total stranger. Text messages are read at a very high rate, but their response rate can be very low at the start. Make sure you use a proven SMS message template to boost your odds of getting a reply.
3. Direct Mail: The tried and true method of sending physical mail to the property owner’s personal residence or office. In today’s overly-digital world, direct mail can have impressive response rates, which can offset the cost of sending it. Again, use a direct mail template for real estate investors that have been tested and measured if you can.
4. Door Knocking: For most people, door knocking is their last resort (especially for non-owner occupied properties that have tenants in them). While this is sometimes your last option, you may be able to stand out from the crowd and really build rapport with a seller faster than a phone call or postcard can. If no one answers, leave a Post-It note with your contact information and a short message on the door or under their car windshield wiper (trust me, this works).
5. Combo: And if you combine any of the three above, you can have exponential results. Imagine you as the homeowner who’s in distress, and you not only get a letter but then a call from the same person… and even a text… and finally they show up at your door! Very few if any, investors are doing that.
AFTER YOU CONTACT THEM
What happens when you finally reach the owner?
Sure, you’ve nailed down the skill set of locating and finding the contact info of the real estate owner…
But what happens next? What are the skill sets needed to close the deal and make sure you’re getting a good deal for yourself?
Below, We’ve listed a list of other skill sets you’ll need to be an accomplished real estate investor:
1. Analyze properties — Without this… you’ll fall flat on your face. This is the most important skill set of an investor. Know how to do this BEFORE you contact the owner… OR, alternatively, use Reverse Wholesaling if you’re still new and still learning.
2. Qualify/screen — While on the phone with an owner, you want to only set appointments/viewings with SELLERS. Just because this is a distressed owner… doesn’t mean they’re looking to sell. So simply asking: “Are you considering selling your property? I’d love to give you a cash offer?.. is the first step to “screening”. If they aren’t selling, the next question is: “Do you know anyone looking to sell?”
3. Book the appointment — Once you verify that he/she IS a seller of the property, you’ll want to make it out to their house ASAP to view the property and give a cash offer — Speed to lead is a REAL thing and can cost you a deal if you’re not fast.
4. Run the appointment — While on the appointment, you want to look professional and be perceived as a REAL buyer. Any lack of confidence and that’ll show you as a weak buyer. So here are some tips: Wear a collared shirt tucked in if male. Bring a clipboard and a checklist for notes. Walk the property and observe EVERYTHING and take note of anything that needs repair. Look concerned about some repair items.
5. Give your offer — Before your appointment, you should already have a “range” of prices. What will determine your Max Allowable Offer, will be the estimated repairs. So when you’re done touring the property, do a quick repair estimate, and MAOP calculation, to give them an offer at the end. TIP: don’t start with your MAX offer.
6. Negotiate — There’s a good chance that they won’t take your offer upfront. Ask them: “How far are we off”. If it’s only a few thousand off and still right at the peak of your MAX, make q quick decision right then and there if you can take it. Ask them: “If I can give you that, can we enter escrow tomorrow?”
7. Follow up — Not all sellers are willing… so you HAVE to follow up. The money is in the follow-up
Skip tracing is a must-have tool for every off-market real estate investor. 30 years ago… this was a very difficult and expensive task to accomplish.
But today, with all the available (and inexpensive) tools at your fingertips, it’s easier than ever.
But it doesn’t end there…
You’ll have to then CONTACT the owner you’re trying to reach to buy your property via a number of marketing methods (mail, call, text, show up).
Then you’ll have to put your skills to the test as a real estate investor.
Skip-tracing real estate is only the start of your career, but it’s an important skill set that can easily be accomplished with a good tool.