As the saying goes, you have two ears and one mouth. So when you talk to sellers, listen more than you talk. If you run off at the mouth, you can’t find out what their motivation is and you will miss out on some great deals. Let the seller dominate the conversation and they will tell you how you can buy their house if you only listen and think about what they have to say.
Larry Harbolt shares with us
Always Do A Little Thinking Before Making Every Offer
If I could wave a magic wand and re-live my early real estate investing career from the beginning, I think I would first try to learn more about what seller’s needs and thoughts are. I would also want to better understand the thoughts and logic that run through a seller’s mind when they are motivated and want to sell their house.
If I had a better idea of what the sellers wanted it will be much easier to make offers the seller might be happy with and hopefully get them to sell me their house at a price and terms I’ll be happy with, and they will get what they want and also be happy with. If I had only known what I know now it would have been far more profitable for me and my family.
I shudder to think of all of the lost deals I have had simply because I never stopped to think about what the seller’s needs were? My thoughts were usually about how I could make a killer deal for myself. This was not the best nor the most profitable way to make money buying real estate. You need to take a minute, step back and analyze what the seller’s wants or needs are, (or at the very least use a little logic to try to think about what the seller might want or need before making them an offer) if not, you are making a big mistake. If you think about what the sellers needs are you will have a distinct advantage while actually sitting face-to-face with them and are negotiating. If you will do this, at least you would have a direction to start going in.
As you talk with the seller and start to ask them the important questions you will start to better understand what is motivating them to sell. If you don’t ask the important questions you’ll never get the answers you need to put together a profitable deal – a deal which is good for both you and the seller. Let me explain…
I have thought back over the years and ask myself, how many times have I made an offer to a seller and had it rejected –only to later find out that the seller owed more for the property than what I had offered them? If it was a house that I liked, if I had just done a little homework and figured approximately what the seller owed on the property might have saved me a lot disappointment and work. – And might have allowed me to make an offer the seller could have accepted so we both would win.
How many times have I thought I knew what a seller wanted without setting down with them face-to-face and simply ask them what they needed? If I had it might have been far more profitable and much easier to put together good deals or be able to quickly determine if it was a good deal or not.
How many times have I thought that all older sellers always wanted all cash? Because I had very limited cash to give a seller I wouldn’t make the older sellers an offer. I never stopped to think that the older sellers might prefer a monthly income to supplement their meager retirement income – instead of getting all cash. I didn’t always ask if they would be willing to take their equity in monthly installment payments. This might have also saved some of them immediate tax dollars if I had asked the right questions, but most of the time I didn’t.
How many times did I make offer’s to younger sellers with smaller children asking them to accept monthly payments for 30 years when what they really needed was enough money to get into a larger house – a house large enough to accommodate their growing family? But because of my limited knowledge about negotiating to buy real estate I simply didn’t understand that buying houses is not the house business, it’s the people business. If you solve the seller’s problems, you will buy more houses. Because of my limited understanding of that concept, I could only make offers that worked for me, but didn’t always work for the seller. If I had thought more about solving the seller’s problems and put together deals that worked for both of us, I know I would have bought more houses, and you will too.
Whether you work with real estate agents or you find properties to buy on your own you need face time to ask the important questions or it will be impossible to make the best and most profitable offers. One thing is for sure, if you don’t ask the sellers the right questions you’ll never know what their needs are.
Real Estate Investor
Larry Harbolt is the nation’s leading Creative Seller Financing expert as well as a popular national real estate speaker and teacher whose time-tested strategies and nuts and bolts teaching style has helped thousands of aspiring real estate entrepreneurs realize their financial dreams with little or no money and without the need for credit. Larry has been successful creatively buying and selling real estate for over 30 years and has written numerous popular articles and real estate courses. Larry also has been running a meetup group for real estate investors in St Petersburg, Florida for over 13 years. Larry is the real deal!
Larry’s will be in Kansas City on September 9th at our Monthly Meeting discussing Creative Financing for Real Estate Investors and then he is coming back on Saturday September 13th, 2014 for an all day Deal Structuring Workshop. Please visit our calendar of events to learn more about these and other events at MAREI.