What is a Skip Tracer and Should You Use One?

Using a skip tracer to avoid losses may be one of the smartest moves you make as a real estate investor. For an investor, there’s nothing more frustrating than to find the perfect property, then run into an unforeseen snag. One such snag is an absentee owner who – for whatever reason – can’t easily be found, but whose signature is all-too-necessary if there’s any hope of closing a deal on their house. Another is a tenant who, owing several months’ back rent, disappears into the night, taking with them any hope of recovering the money they owe.

Both of these issues can potentially be solved by hiring a skip tracer. Hiring a skip tracer can also help you size up potential tenants, business partners, or employees.

Named for the idiom “skipping town,” where someone disappears, leaving little or no evidence of their whereabouts, skip tracing is a method of finding individuals who have either fled, or whose whereabouts are simply unknown.

Skip tracers are professionals who, much like private detectives, perform detailed investigations into individuals. However, unlike private investigators, any information a skip tracer collects about their subjects goes solely toward finding them. Skip tracers are used by a number of different individuals or companies, including creditors, process servers, repossession agents, bail bondsmen – pretty much anyone who really needs to find someone.

Even in the digital age, it can be difficult to locate someone, especially if they don’t want to be found. Skip tracers often go to great lengths to find their subjects, including cross-checking addresses through credit reports, rental applications, or criminal background checks, or even knocking on doors of addresses where they might possibly be located.

While skip tracing can be beneficial to you as a real estate investor, it is important that you weigh the necessity against the time and expense. Skip traces aren’t free, and they aren’t necessarily quick.

Depending on the complexity and time involved, skip traces can cost anywhere from $25 to a few hundred dollars. If you have a tenant who owes you a little bit of back rent or some utility bills, and you can’t find them on your own, it may not be worth it to pursue the matter. After all, once you do find them, you’ll potentially face court fees, process server fees, collection fees and other expenses in your attempts to collect.

However, if you’ve found a can’t-miss property, or if you’re in escrow up to your eyeballs and you must find a home’s owners, skip tracing can be a very wise investment.

Keep in mind, skip traces can maximize your seller lead return while using the Find Motivated Sellers Now system – a nationwide database of property owners who are sitting on high equity (or free & clear) houses that are VACANT.