LOS ANGELES – “Some of the cheapest and best deals come from private sellers,” says, Local Records Office. Many folks online have been asking questions on how to get the best deals but yet make sure the seller is legit. A terms deal is a deal where the seller is willing to participate in the financing. This could be an owner carry, a lease option, a subject to, or any other method of buying a home without getting a traditional or bank loan. This is becoming increasing important for many buyers in real estate because they have the opportunity to grow personal portfolios and it becomes harder to get conventional financing. It is because of these types of deals that I have been able to build a large rental portfolio.
Motivated Sellers are the Best to Work People With Because of the Ambitions
It is important that you are talking to someone that is really motivated to sell their house for them to be open to this type of creative offer. For this reason, it is important that you deal directly with the owner and that you take some time to qualify their motivation before you spend too much time with them. For the purpose of this article I am going to assume that you are marketing for sellers to call you and that your phone is ringing with seller leads. If you are unsure how to get sellers to call you be sure to check out our blog or our bi-weekly videos on Youtube and Vimeo.
I believe it is always best to answer the phone. If you cannot answer the phone, be sure that you have a very pleasant outgoing message so that people feel welcome to leave a message. Here is a sample of how your phone call should sound:
You: Thanks for calling this is Carlos
Seller: Yea… I saw a sign on the side of the road that says you buy houses.
You: Yes, do you have a house for sale?
Seller: I do
You: Awesome. Go ahead and tell me a little about your house.
Seller: The house has 3 bedrooms and 2 bathrooms. I just recently painted the living room this really cool blue color. I have also recently painted clouds on the ceiling in my kid’s rooms. They seem to like it.
You: Sounds like a wonderful house why in the world are you considering selling?
Seller: I lost my job a few months ago and am starting to fall behind on the loan.
You: I am sorry to hear that. How much do you think you house is worth?
Seller: probably $125,000
You: And how much do you owe?
Seller: See that is the problem. I owe too much to sell it. I still owe $120,000
You: That’s ok. And your payments are how much?
You: Does that include taxes and insurance?
You: Is it a fixed rate loan?
Seller: I think so.
You: I would be interested in coming out and taking a look at the house. Can I do that?
Seller: Sure. When would you like to see it?
You: I have a little flexibility. Are you the only owner or is someone else on title with you.
Seller: My wife
You: Is it easier for both of you to meet me in the afternoon or evening?
Seller: Evenings are better
You: Ok, which is best; Wednesday or Thursday at 6pm?
Seller: Thursday works better.
You: I just need to get the address from you and I will see you Thursday at 6pm.
There are a few things I want to point out here. It does not matter what they say about the house when you ask them about it, what is important is that you use this to start the conversation. Your screening process starts with one very important question. “Why are you considering selling?” The answer to this will tell you if you want to move on with the conversation or not. If they give you a reason that makes you think they are motivated than you need to dig into the details of their current loan. You don’t need to follow this script word for word and honestly the conversation may take you in a different direction but I wanted you to see how a typical conversation might go.
It is important to get as much information about their loan as you can. If it appears they are motivated enough to say yes to a creative offer AND you can think of a solid exit strategy, than it makes since to go meet with them. You will of course want all decision makers there, so it is important to make sure everyone that is on title can make your appointment. Finally, it is a good idea to offer a few suggested times so it appears that you are busier than you really are. If you are busy you are in demand and which will help make them want to work with you. “Now go get that phone to ring” says Local Records Office.
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