Should I buy leads?
October 27, 2006 by Don MurrayHello Bloggers:
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I have been asked to write about a fairly controversial topic -- Buying Leads
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The real reason I want to write about this is to solicit your thoughts and input.
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The question basically gets down to -- Should I buy leads or not? -- And if so, What or where should I buy"??
Our firm has bought a considerable number of leads in the past."? Sometimes we were successful and more often than not we were not successful.
Our firm has bought a considerable number of leads in the past."? Sometimes we were successful and more often than not we were not successful.
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The problem is that the statistics provided by most lead generators is seldom accurate."? It is inaccurate either because they don't know their statistics or because they don't care."? Based on our experience and comments from friends in the industry a success ratio of 1 in 35 would be considered very good."? That means for every 35 leads you purchased you could close one deal."? We found we could hit 1 in 47 in the best of times and faired much worse in other times.
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What's the problem? -- There are several.
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If we assume all lead sellers are ethical, the fact still remains that they do not have any degree of control over their potential Buyers or Sellers."? If their Buyers or Sellers are on the lead generator's Web Site or responding to the lead generator's telemarketing efforts, the same"?Buyers or Sellers are"?most often on other web sites and are also responding to other telemarketing efforts as well."?
The result of this of course is that the same lead for a specific Buyer or Seller is sold by many different lead generation companies"?to many different Realtors and Mortgage Companies."? And yes, some Mortgage Companies in turn provide their leads to Realtors and so on.
The result of this of course is that the same lead for a specific Buyer or Seller is sold by many different lead generation companies"?to many different Realtors and Mortgage Companies."? And yes, some Mortgage Companies in turn provide their leads to Realtors and so on.
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Another problem of course is that all lead generators are not ethical and the problem this causes is self explanatory.
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Market Timing --
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It has been our experience that when the interest rate cycle provides a significant reduction in interest rates, purchasing leads can be very productive. This is not limited"?to the "Re-Fi" business, but is true for purchase business as well."? Other than during this specific segment of the business cycle, we have not found the purchase of"?leads to be a good investment."? I am interested in hearing from Agents that have had a better experience.
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At the current time in the market place, we have found investment seminars and other presentations to potential Buyers is the most productive use of our time."? We typically pull investment capital out of our Client's existing properties by refinancing and use this money to make sizable down payments on investment properties with fairly small loans that provide cash flow.
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It has been our experience that you will find the best investment of your time and resources in committing to"?a training program that can turn you into an expert on financing while fine tuning your real estate skills to work with Investors and to develop a strong referral network through"?Financial Advisors, CPAs, Attorneys, Branch Bank Managers, Credit Union Managers, and yes, Hard Money Lenders.
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I would appreciate your thoughts and comments.
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Thanks -- and -- Always Remember I Can Help You
Don""""
Don Murray""""
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California First Financial -- Serving All of California
Financial Planning, Real Estate Brokerage and Mortgage Loans'
DonMurray@CalFirstFinancial.com
www.CalFirstFinancial.com'
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949-413-2240 -- Phone"?
949-203-6355 -- Fax""""
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I have worked in the financial market for years. Lead generation is one of the most important aspects of the business, if not THE most important. I have worked for a lead company with a pretigious name, and they were great. At about 5% average close ratio, commission base advisors make between 20 and 50K, for a $400 investment. The time invested is more than the money, but 400 to 50,000. Come on, no brainer. I switched to selling products instead of leads, and I use the same leads I used t sell. Buy leads, and buy as many as yu can work.
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