What’s a motivated buyer? Well, you’re looking at him. I’m a motivated buyer, and I’m not ashamed to admit it. That means I spend my time tracking down and meeting with motivated sellers who are eager to sell me their houses, condos, and mobile homes. Soon enough, you’ll be a motivated buyer, too.
We’ve been investing in real estate investing for years, and in that time we’ve developed a system for negotiating with sellers. It’s nothing more than taking what we’ve learned that really works and turning it into a system of rules which we scrupulously follow.
If you’re not familiar with the system, it may seem like we’re doing things backwards at times, or that we’re getting the “cart before the horse.” Trust me, we’re not. I’ve done this enough times to know what works and what doesn’t and, once you’ve worked things this way, I guarantee that you’ll never go back to the old methods.
This is why I need you to forget everything you’ve already learned about real estate investing. At least for the training period, make certain you suspend your earlier training and give my system a fair shot. If you inject your preconceived notions into the game plan, you’ll never be able to appreciate how things can be.
So what is it?
The Motivated Buyer understands a handful of things:
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Get them while they’re hot.
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A house is a house is a house.
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Write it up now and sort it out later.
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Let someone else do all the hard stuff.
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Never spend your own nickels and dimes.
Understand those five things, and real estate investing will all of a sudden look like kid’s play to you.
Get them while they’re hot
You bet. We deal with motivated seller with itchy trigger fingers. They can’t wait for us to put an offer in front of them, so they can get that sucker signed off and get the property out of their lives once and for all.
It often doesn’t take more than a moment or two on the telephone to hear motivation, or the lack of motivation, in the seller’s voice. If he’s not a “hot to go” seller, then he likely is not someone we’re interested in dealing with. We’re looking for those “hot to go” sellers, and when we locate one, we get our proposal into their hands immediately.
A house is a house is a house
This is a business where houses are the commodity. They are our stock in trade. This means that it really doesn’t matter to us whether or not it’s something we’d like to live in ourselves. It’s a house, and I assume someone will want to live in it at some point.
Yes, I understand that there are some houses that no one would ever want to live in, and we’ll pretty much eliminate them as we go along. But generally, you can count on the fact that a house is a house is a house, and that we really don’t particularly care about all the details at this point in our game plan. Sure, at some point we may very well care. But for now, we’re just not interested in spending the time that it would take to thoroughly research the particular ins and outs of each and every property we encounter.
Write it up now and sort it out later
That’s why we can make offers over the phone on properties we’ve never even seen. We use the information the seller provides us to formulate an offer and, based on his numbers, we get an offer into his hands. Upon acceptance (and only upon acceptance) we begin the “sort it out” process.
It is during that process, also called the process of “due diligence,” that we determine whether the seller was giving us real numbers or was just blowing air up our skirts. Often, we find that the seller was more than a little bit optimistic, or that the numbers simply don’t check out. In such cases, we advise the seller of our findings and we decide whether we want to renegotiate or simply walk away.
Let someone else do all the hard work
Real estate investing often requires that someone spend lots of time figuring things out, inspecting, getting estimates, applying for permits, etc., and I’m just not interested in that sort of thing. Sure, if it’s a quick and easy problem that can be fixed by a couple of phone calls, I’m on it. But if it means jumping through lots and lots of hoops, I’m more inclined to let someone else do it.
Who’s the someone else? It’s our prospective buyer. Once we have a property tied up and we’re marketing it, we let the buyer figure out those tough things that often require more time than we care to invest. No, we’re not lazy. Our time is just better spent in other places (like talking to motivated sellers).
Never spend your own nickels and dimes
This is a good motto to have to keep you from getting “nickeled and dimed” to death. Believe me, it’s super easy to start writing two, three, or five hundred dollar checks to get the process started. Don’t do it. We’ll figure out a better way and let someone else write those checks. Believe me, I nearly went broke writing all those checks I thought I had to write way back when.
Earnest money? Forget about it. It’s also easy to start writing fifteen hundred or two thousand dollar checks for down payments and the like. Let’s commit right here and now that we won’t be doing this. You can make things happen without putting your cash on the table.
Remember…
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Get them while they’re hot.
-
A house is a house is a house.
-
Write it up now and sort it out later.
-
Let someone else do all the hard stuff.
-
Never spend your own nickels and dimes.
Understand these five things, and your life as a real estate investor suddenly becomes a whole lot easier.