Welcome back to this edition of covering this Flip Tip that you can be using right now within your business. Now, within this Flip Tip article, I want to discuss finding fire damaged properties. Now, fire damaged properties can obviously cause a lot of opportunity for you. It could be a win-win for everybody involved meaning you can help solve a complete negative problem for a potential owner of record that’s going through a very tough time. Obviously, their house went in flames, and you could be the individual that helps them.
Now, fire damaged properties, depending on the level of the fire damage that is involved with the property is going to prove whether if you get involved or not. What I want to really cover here on this particular Flip Tip article is for fire damaged properties, let’s just first cover fire damage. Where you want to come in at and where you don’t want to even get involved with the property is crucial. I will tell you this, getting involved with the property is maybe the kitchen set on fire and the whole, entire kitchen is completely damaged. It hasn’t been marked off as, “Hey, this needs to be completely condemned,” the property.
There’s certain types of properties to go after, and there’s some to just absolutely avoid, I won’t consider kitchen fire to be minor because a kitchen is obviously pretty significant, especially depending on the square footage of the particular property that we are in reference to. I would, when you’re taking a look at these particular properties, what I would first of all do is really just find out the level of where the property is at as far as any significant damage to the property because that’s going to be huge. You need to find that out because maybe it’s something happened.
More than likely, most of the fires are going to happen in bathrooms and kitchens. More likely it’s going to be caused in the kitchen. Maybe an oven was left on, maybe something was left in the toaster. It’s going to be a wide range of things that could potentially happen within the property. That’s where I would focus my time and energy. You’re going to obviously have some potential fires from dryers. You’re going to have potential fires from a furnace. You just need to find out the level of the severity in the property.
When I stay away from the properties is if complete floors have been demolished. Unless I can get the property at a significant discount pending those significant damages, then I’m going to go ahead and move forward with it. If I’ve got to replace floors and I’ve got to completely replace roofs, I just obviously have to look at my numbers. I’m not going to tell you on this particular video that you just need to completely shy away from it. It all depends on the type of discount that you could get. What it really boils down to is what does the homeowner owe on the property in order for you to get that property at the type of numbers that you need to get.
Let’s hop into this and start talking about where you can find these deals. As I’ve stated in previous videos before, I believe real estate agents are really a key contributor that you need on your team, on your business. These are people that could be really great partners for you. I would highly encourage you to sync up with a real estate agent because they can do some really great stuff as far as the MLS. You could find great deals as far as properties with fire damage on the MLS. Those properties will get listed, and you will be able to find them through your real estate agent. They will be able to go show you the properties and you’ll be 100% taken care of.
That could be a really great opportunity for you. Make sure you’re connecting with real estate agents. If you’re having a tough time finding real estate agents, you could obviously find them on Facebook, you could find them on LinkedIn, you could find the on YouTube. You could do a simple Google searches. It will be a really great opportunity for you.
Second of is most people don’t even realize this, but the individuals that are putting out the fires themselves, the fire departments. You could find out from your local fire department if there’s been any recent fires within properties. It’s public information. You could find that out. Obviously, just be really, really nice when you give them a call on the phone, and they’ll be more than happy to share any of that information with you. Then, up to you at that point is reaching out and getting in contact with the owner of record to see if there’s anything you could do to help out with getting that property off their hands.
More than likely, if they’ll pay off the mortgage and then whatever else is owed to them, they’ll go and either rebuild the house or fix whatever was done in the house, or they just want to get rid of it because they have the insurance money now. They could probably put a significant amount down on another property to where they don’t have to wait and be in a hotel. Again, you’re solving a problem, a significant problem for somebody that potentially has a family. That’s the other thing you have to get involved here with is they could potentially have a family. Most people don’t want to be spending two, three months in a hotel, especially depending on the size of the property. It could take longer.
Another source for you, and I’ve talked about this in other videos too is insurance agents. I know a lot of the time we don’t really reach out to insurance agents. They talk a lot of numbers, and analytics, and all this other stuff about insurance which really doesn’t get us excited at all. It’s actually quite boring but it’s probably some of the most important stuff as investors we really need to be aware of. These people are a gold mine, and if you treat them right, they’re going to treat you right. I would highly encourage you get involved with an insurance agent who’s going to reach out to an insurance agent to let them know, “Hey, we just had a fire last night.” The owner of record is going to reach out to them. It’s highly important that you have at least two or three insurance agents that are on your team because it’s crucial.
I try within these Flip Tip articles at least give you three people that you could always reach out to for getting these types of properties. We’ve gone over mold, we’ve gone over short sales, we’ve gone over estates. On this one, we’re going over fire damage properties. It’s having these contacts is extremely important. If they’re not on your team already, reach out to them. You can find them, again, on Facebook, YouTube, LinkedIn, Google. Google is just gigantic. You could find some really great people on there.
Again, you could pick up these properties to either wholesale, to rehab. If you want to fix and hold, you could absolutely do that too. I don’t really want to spend a bunch of money and then wait to get somebody in there. I like to typically buy properties to where they already have tenants in them and they are in an income producing state as is. Whatever floats your boat, if you have the capital to do that, to float it, or if you’re using bank financing, then great. We tend to wholesale these properties or rehab them.
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You’re going to find this on Facebook, you’re going to find it on my blog, you’re going to find it on YouTube, and potentially some other places. That will help me out, but it will also help you out because I’ll continue to make exciting videos that will give you the type of knowledge you need to just go out there and absolutely crush it. With that being said, this is the Flip Tip about finding and flipping fire damage properties.
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