How to Make Money With Finders Fees From Real Estate – No Property Ownership Necessary
So, you want to learn how to make money with finders fees. A finders fee is basically money you are paid for connecting a person with another person or thing of value to them that they couldn’t or didn’t want to find themselves. Finders fees are paid out for a wide range of things, but for the purpose of this article, let’s focus on how to make money with finders fees from real estate – one of the best ways to make a lot of money per transaction.
One way to make a nice-sized finders fee is to “option” a property someone is desperate to sell. Basically, you buy the option to sell the property on someone’s behalf (paying $1 or so to legalize your contract). This works well with people who are in tax sale foreclosure or who otherwise can’t seem to sell their home but need to move on. You find a buyer who is willing to pay X amount for the property, and then you offer the owner X minus whatever you want to pay yourself. If the owner is willing to accept, you’ve just made a nice finder’s fee without ever having to own a property.
If you really want to know how to make money with finders fees, you have to look into tax sale overages. These are the overbids created at tax sale (when more is bid, than was owed in taxes). These overages are due back to the owner, but for a variety of reasons almost never make it back to them. The owners generally move on without realizing they’re entitled to the funds.
If you can find the records of these overbids, and locate their owners, you can legally charge up to 50% to reconnect them with their funds (they almost never have any idea where this “found money” could be coming from). On a $20,000 overage, which is par for the course, you could make up to $10,000. And keep in mind – these funds are just sitting there, waiting to be collected… it’s not a rocket science, but you have to know what you’re doing.