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Skip Tracing: The Ultimate Guide For Real Estate Investors

skip tracing Jan 02, 2020

Skip tracing, also known as fugitive or debtor recovery, is a term that you may have heard being tossed around by private investigators and bounty hunters, especially in movies such as Skip Tracer (1977) and investigative TV programs.

Often, these TV programs that use skip tracing revolve around finding fugitives and bringing them to book. What you might not know is that this process is also wildly useful in the real estate business.

In case skip tracing is critical to you, but you don’t have much information about it, you have come to the right place. Read this guide to the end, and you will doubtlessly have a better understanding of skip tracing. 

Enjoy Skip Tracing: The Ultimate Guide For Real Estate Investors! Use this guide to jump to your section of choice:

 

What Is Skip Tracing?

Skip tracing is the process of finding a fugitive, defaulter, or any person who cannot be located in typical places such as their residence, place of work, or entertainment venues.

To further understand this term, we can break it into two words as follows:

Skip – is derived from the phrase ‘skipping-town’ and refers to the person being searched.

Tracing – refers to the act of finding the ‘skip.'

Still confused? Let's consider the following example:

You buy a car on credit, but after a while, you default on loan payments. The lender (who in this case is the person or company that sold you the car) might be prompted to hire a skip tracer to find you.

If at some point, you have used social media, public records, or white pages while attempting to locate someone, then you have already skip traced at a basic level.

To better understand skip tracing, watch this informative video from Maricopa County Process Service:

The process of skip tracing is often executed by a professional skip tracer who may be regarded as a expert in this field. 

Professionals who use these services include:

More often than not, skip tracers are looking to confirm the person's current location, updated contact information and background screening. 

 

Is Skip Tracing Legal?

is skip tracing legal

Yes, skip tracing is legal in the United States.

In some cases, however, this process might be deemed illegal. For instance, you might find yourself on the wrong side of the law if you use illegal methods to access private information, or if you use violence to get information.

If you are an aspiring skip tracer, the good news is that no law prohibits you from using the contact information or any other intel you have to find the whereabouts of a person.  However, you need to meet several legal requirements so that you can engage yourself in the trade.

There are laws in some states that dictate how you should use the information you have to find out where someone is. Some prohibit you from misleading or lying to a person about the intent of finding them.

This means that it is legal for you as a skip tracer to find the people you are looking for, but it is also your obligation to truthfully outline the reasons why you need to find them.

Today, there has been an increase in skip tracing harassment across the country due to the rising number of online skip tracing services. This makes the process appear illegal, while it’s not.

When looking for a professional skip tracer, therefore, do your due diligence properly, and ensure you select one that will not force you to step on the line and find yourself in trouble.

Make sure you don't contact sellers that are on the National Do Not Call Registry. Cross check your list through a phone validator service such as RealPhoneValidation.com to ensure you're not in violation of Telephone Consumer Protection Act (TCPA) laws.

Modern skip tracing services exist that allow individuals to find information on difficult-to-reach people.

 

What Is Skip Tracing In Real Estate?

Skip tracing in real estate is the process of locating the whereabouts of a person. In the real estate business, skip tracing is often used to find property owners who are likely to be motivated sellers. By attempting to locate these owners, real estate professionals are looking to find investments, listings, and great wholesale deals.

As a serious investor, you should become familiar with skip tracing to get contact information from hard-to-find property owners, such as absentee owners. Instead of using direct mail, skip tracing can be a more effective way to reach these potential sellers. 

Through this, you will find homeowners that other investors haven't found; thus, you will have better odds of closing deals with motivated sellers. 

While every other real estate investor is sending snail mail, you can be the first person to call an owner with a solution to help them out of a distressed situation - often before they've even thought about selling!

 

How Do You Use Skip Tracing In Real Estate?

Skip tracing might sound basic, but it is the most effective method of quickly finding property owners.The idea behind this process is to obtain contact information for property owners who are not easy to locate.

Skip tracing is pretty simple in real estate - the amount of information we need is usually minimal. We're looking for an owner's current:

  1. Property Addresses
  2. Phone Numbers
  3. Email Addresses
  4. Full Name
  5. Social Security Number or other pertinent info

In many cases, absentee or out-of-state homeowners don’t leave their current address in public record. Luckily, if they left a forwarding address with the National Change of Address (NCOA), one can easily track them down.

But here is the challenge… the postal service is not obligated to provide you with the forwarding address of a person, even if you provide hundreds of valid reasons! 

This is when skip tracing comes into use.

Luckily, there are tons of skip tracing services available online. Before you sign up for a service that catches your eye when doing an online search, make sure you determine whether it will provide the utmost value for your hard-earned money.

Also, keep in mind that a simple search on social media or search engines can give you all the information you need about a property owner you are looking for. Therefore, determine whether you can perform a skip tracing process on your own before opting for a paid service.

Once you confirm the property owner's information, it's up to you to make contact and determine how you can help the seller out. This may mean purchasing the property, helping them sell the property on the market, or simply offer them useful information about their options. 

 

How To Perform A Skip Trace On A Property Owner?

what is skip tracing

Do you want to perform a skip trace on your own?

Below is our Six-Step Skip Trace Strategy that might help you land a great deal:

1. Plan

As they say, "If you fail to plan, you plan to fail." This is a saying that holds truth in various contexts, and skip tracing is not an exception.

What's your intended outcome with this lead? Are you looking to purchase the property, wholesale it, or list the property for sale? Start with your exit strategy in mind. Create a follow up strategy so you're prepared once you identify your target. 

After doing this, visualize how the subject looks like using your gut instinct and intuitiveness. Try to understand what they are going through. Your creativity and imagination will aid you as you prepare to approach the property owner. 

2. Obtain Leads

After developing a plan, get an address or name of a property owner who you think could have motivation to sell. Sellers who are facing foreclosure, delinquent on taxes, or even absentee landlords are all potential motivated sellers.

You could be driving for dollars, walking the dog around the block, or run into a local estate sale. If you see a distressed property, write the address down. Boom  - there's a lead. 

Another way to find motivated seller leads is through websites, such as ListSource.com, where you can purchase lists of property owners that are more likely to sell. 

3. Research

Search the internet for information about the property and person being searched. You might be surprised at how easy it is to learn all about people on social media these days. 

Check all social networking websites such as:

  1. Facebook.com
  2. LinkedIn.com
  3. Instagram.com

Look for their phone number in online phone directories including:

  1. YellowPages.com
  2. 411.com
  3. AnyWho.com

Running a thorough Google search and checking public records, such as county assessor websites, can reveal much about a property owner. Sometimes, you'll find family members or friends who might have more information on the subject. At this point, you may have found all the information you need. If not, carry on to the next step. 

4. Organize

Prepare the information you've collected about the lead in a format that you can share with your professional skip tracer, or that you can upload to a skip tracing service. If you just have the addresses without the names, that's perfectly fine. 

5. Upload

Upload your lead or list of leads into a skip tracing service like www.PeopleFinders.com (as seen in the below image) or simply share with your hired private investigator.

skip tracing services

Here you can enter the name, address, or phone number of a particular lead and wait as the skip tracing is performed. Once complete, you can obtain the full profile of the property and owner, including the essential contact information that we need.

6. Identify & Make Contact

Congratulations - you have completed the job of debt collectors and repossession agents!

You should now have all the information you need to make contact with the target you've been attempting to locate.  It's time to get in touch, work your magic, and perhaps even close a deal with the seller!

 

Should I Consider Batch Skip Tracing?

Batch skip tracing is the most common and the most beneficial type of skip tracing used by real estate businesses and wholesalers to find contact information on a large list of prospects.

Also known as bulk skip tracing, batch skip tracing is simply finding the contact information for an extended list of property owners at the same time.

Due to the simplicity of skip tracing for real estate, batch skip tracing is a feasible and effective strategy for investors. Remember, we are just looking for property owners’ name and number.

As a real estate agent, you can use a name and address to generate reliable mailing lists and a contactable phone list. This is another way to utilize bulk or batch skip tracing.

Also, batch skip tracing comes with low costs of generating leads, allows you to focus on a list of motivated sellers and contact them fast. It can also go a long way in increasing ROI versus other marketing methods.

Despite being beneficial to real estate investors, it doesn’t mean that batch skip tracing is a bed of roses. Quite often, you might get false positives from this technique, and you might not get the right information you need.

In such situations, it is prudent as a result-oriented real estate investor to seek the services of a professional skip tracer. Regardless, be prepared for trial and error over many phone calls. 

After batch skip tracing is performed, you'll ideally have a large list of phone numbers to call. Consider using an automated dialing system such as Mojo Dialer.

 

What Types Of Property Leads Are Best For Skip Tracing?

There are various property leads that real estate investors should use and take advantage with skip tracing. Certain circumstances signal potential motivation for sale. 

They include:

  • Tax Delinquent Properties: Home owners that are behind on taxes and owe money
  • High-Equity Property: Owners that have more than 50% home equity in their property
  • Absentee Homeowners: Also known as out-of-state owners, absentee homeowners are those who own a 2nd home or have multiple investment properties. They are doubtlessly make up the biggest portion of motivated home sellers
  • Vacant Homes: these are homes that have been reported vacant for the past 90 days, and mails delivered to such homes are never returned
  • Empty Nesters: this comprises of a unique group of homeowners whose children have left the house for college or to start their own families. Such people may be willing to downsize their homes
  • Growing Families: if a couple had a new baby within the last 24 months, they might be willing to get a bigger home so that the toddler can get some space to crawl and run. In such a case, they might need to sell their current house
  • Senior Owned Homes: Most people who are 72 or older may want to downsize their property so that they can get peace of mind
  • Old Listings: Properties that have been on the market for a long time, but haven’t sold
  • Deceased Owners: Properties owned by recently deceased people, an estate, or a trust
  • Corporate Owned: Properties in an LLC or other entity typically own more than one property and may have an interest in selling
  • Recently Divorced: Properties owned by recently divorced partners
  • Pre-foreclosures: Properties owned by people given Notice of Default, or those who are behind in mortgage payments

 

What Are Average Skip Tracing Prices?

skip tracing prices

For any real estate investor, time and cost-efficiency are critical. Therefore, when looking for a skip tracer, you are looking for someone who will offer a service at the lowest costs, while at the same time providing an outstanding turn-around time.

With that in mind, how much does this process cost?

Truthfully, the amount of money you pay to locate a property owner will depend on the skip tracer you choose, the complexity of the search, and a host of other factors.

On the low end, you might pay as little as $10.00 to hire someone to skip trace 100-200 property leads on sites like Fiverr.com. There, you'll find some of the most affordable skip tracing services available. 

Other online pay-per-use skip tracing services may charge around $1-2 per property lead. Some will charge $10-24 per skip trace, claiming they have more accurate and current information. 

Expect a portion of the phone numbers you receive to be disconnected lines or out of date. Account for this when determining your budget and performance metrics. 

If you hire a private investigator for a very difficult to find person, it may cost much more. Expect to pay $40-100 an hour for a private investigators to conduct an exhaustive search on your subject.

If you're lucky - you may find with a skip tracer who provides a 'no find, no pay policy.' This means that if they don't find the property owner you are looking for based on the amount of information they have, you will not pay a cent for the process.

Most skip tracers will, nonetheless, charge some administration fees even if the person you are looking for is not found. You could be charged more if some vital information about the person you are looking for, such as their social security number, cannot be found.

Before choosing the skip tracer to work with, shop around and get different quotes for the job. By doing this, you'll be able to determine one who you believe will provide the most appropriate services while complementing your budget.

 

Pros And Cons Of Skip Tracing

Pros of Skip Tracing

Skip tracing rides along with a wide array of benefits including:

  • Less Competition: Skip tracing helps real estate investors find ‘missing property owners,’ hence the term skip. Once contacted, there's a good chance there will be no other offers on the table. Therefore, you'll be in a better position to work out a win-win deal with the property owner. 
  • Unlimited Opportunity: Skip tracing can help real estate investors tap into any market at any time. By essentially acting like a bounty hunter and attempting to locate property owners, you can leverage skip tracing to strike up a deal on any piece of real estate you fancy. 
  • Speed: Skip tracing is arguably the fastest method of generating leads. Going around the city looking for signs that advertise properties or finding homeowners selling houses at great prices using services such as www.FSBO.com can be time-consuming. Using this technique, you can crank out lists of prospects and start making calls immediately.

Cons of Skip Tracing

Skip tracing also comes with some disadvantages which include:

  • Cost: Even if you don’t find the property owner information you are looking for, you must pay your skip tracer or skip tracing service. However, you might be lucky to find a service that will provide you with a no find, no pay policy (though it’s rare).
  • Data Inaccuracy: Not every owner can be profiled with skip tracing, and you might end up paying for wrong, disconnected, or outdated phone numbers. If you or the skip tracing company you are working with is not persistent or thorough enough, there are homeowners that will 'skip town' on you. These include people who regularly change their identity, contact information, or use alternative social security numbers.
  • No Guarantee: After you've contacted the property owner, there's no guarantee they will sell. Even if they are willing to sell, will it be a good deal for you? Still, there are other strategies that will help you find more real estate deals consistently

 

What Are The Best Free Skip Tracing Tools?

As a real estate investor, you want to spend most of your time managing your business. You, therefore, need skip tracing tools that can scour the web for digital footprints and generate pertinent details about the property owner you are looking for.

Listed below are some of the best free skip tracing tools that will make lead generation and data gathering quite an adventure!

Search Engines

Before looking for a paid skip tracing service, use search engines such as:

  1. Google
  2. Bing
  3. Yahoo

You can attempt to locate your subject by keying in their full name, address, phone number, and any other information you have gathered.

With search engines, you can use the advanced search option, and choose whether you want to get results as you have entered them, or you want to be redirected to pages that contain the keywords you have entered.

Social Media Websites

With the help of social media sites such as Facebook, Instagram, LinkedIn, and Twitter, finding information about anyone is now easier than ever.

Social media users often add crucial information in their profiles, including their full names, their occupation, contact information, and check-ins. As soon as you find your subject on social media, go through the posts, and you may confirm their current location with ease.

County Assessors

County assessors are government agencies throughout the United States that are responsible for valuing each parcel of real estate in their dedicated geography. They typically have websites that have searchable public information regarding a subject property or owner, for instance Harris County Appraisal District in Houston, TX.

Online Directories

There are a host of online directories that pull up information from telecom service providers. This helps you find the full name, phone number, or verify any details about your subject without hustle. Check out online directories, such as:

  1. Spokeo.com
  2. SkipEase.com

Email Checkers

Email checkers help you verify the validity of the email addresses you have gathered. Some of the best email checkers include:

  1. EmailSherlock.com
  2. Email-Checker.com

People Finder Sites

There are lots of people finder websites online. However, they are not made equal. There are some which are genuine, but there are those that will give you limited information about your subject, but prompt you to pay a subscription fee to get comprehensive details.

Some of the best sites you can try for free include:

  1. Pipl.com
  2. TruePeopleSearch.com

Obituaries

This suggestion may sound crazy, but it’s one of the most viable tools when it comes to finding hard-to-locate homeowners.

All you need to do is search for the person's name, previous city of residence, followed by the word 'obituary.' In some cases, you will find what you are looking for. This will help you find the places of residence of the immediate relatives who might help you in your quest.

Genealogy Websites

In case finding your subject using most of the tools mentioned above fails to work, you can try using genealogy sites.

One of the best genealogy sites is www.myrelative.com. With it, you can search your subject by name, email, or phone. Then, you will get the information you need about your subject, including full names, age, year of birth, names of possible relatives, phone numbers, and past and present place of residence. Often, this site provides valid email addresses you can reach out to.

If you don’t get as much information as you need using the site mentioned above, you can try www.familytreenow.com, which will give more elaborate details, though it doesn’t provide email addresses.

As long as you uncover workable tactics to use, the free tools mentioned above will make skip tracing easier than you ever imagined.

 

List Of The Best Skip Tracing Companies

Some of the best skip tracing companies on the internet include: 

 

What To Do After Skip Tracing Real Estate Leads?

After you have found the property owner you are looking for, the next thing you need to do is contact him or her. Have a follow up system in place, along with a script and database for all of your conversations. Consider using a free customer relationship manager (CRM) such as Google Streak

Before buying the property, gather as much information as you need about it from the owner, so that you can be sure you are going for the best deal.

One critical thing you shouldn't forget to do after skip tracing your real estate leads is to understand the owner's situation and find out why your lead is interested in selling the property. Uncover the seller’s motivation and help them understand their options, before drafting the contract and making your offer. 

Keep in mind that the more solutions you offer to your prospects’ problems, the higher the results your skip tracing expeditions will yield.

After understanding the situation, the seller is going through and offering the most viable solutions, hire a good real estate lawyer to draft a contract to purchase or list the property. When all parties are contented with the agreement and append their signatures on it, it's up to you close on the property, take the listing, or flip the contract

 

Final Thoughts On Skip Tracing

If you use skip tracing effectively, you will doubtlessly remain at the top of the game. This is because you will reach prospects that other real estate investors are unable to reach, thus making more sales that will help you stick out of the competition.

Of course, skip tracing prompts you to go an extra mile. Sometimes, you will have to spend money, not to mention the amount of time and energy you will invest to achieve your goals.

However, if you follow the process and implement the ideal techniques, the success you will achieve will be worth the struggle.

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