On the Phone w/ Sellers
I had a spectacular time at my local REIA meeting last week. It was an excellent opportunity for me to learn from other people about how they talk to sellers on the phone.
Also, this includes some of my personal opinions and view points as they were at the time of drafting. So, if you think they may be inaccurate, feel free to enlighten me with yours!
This presentation was put on by a local investor’s organization (VPs group). They went over how they talk to warm leads and how they talk to cold leads. They pointed out that with cold leads you will want to take a little more effort in creating rapport with the seller because they have never heard or talked to you before and could potentially have their guard way up. They recommended establishing rapport by being a little more personal with the sellers, For example when the seller tells you the reason they are selling the house is because they are moving, go a step further and ask them why they are moving and possibly throw in some small talk about a personal experience you've had moving. The presenters preceded to make 4 live phone calls to demonstrate how they talk to both warm and cold leads/sellers.
They said its always a good idea to start off the call by asking for the seller’s permission to talk. This is what I would like to call priming the call. It primes them into say the word “yes”. I really liked this. I've never heard of it before but it absolutely makes sense to me. Here are few questions to ask sellers that I'd like to mention here.
- “Was there a mortgage granted on the house?” “What are your monthly mortgage payments?” This can give you an idea of their equity, and knowing what their monthly payments are will allow you to make a quick analysis of the possibilities for a subject-to or wraparound strategy.
- “What do you think the property is worth?” “How did you determine that price?” This is going to tell you exactly how to talk to them in the future and what you will need to educate them.
- “When do you want to sell?” Again, qualifying their motivation.
- “Would you like me to email you an offer?” This is just another way to get a “yes” out of them and you also get their email address.
- “What are your plans for the cash?” A great question I think that should be asked to everyone (with equity of course). It opens up a possibility to talk to them about seller financing and receiving a better rate of return.
- I learned that it is good to get as far on the phone call as possible. It just goes back to running an efficient business. So it may not be a bad idea to start talking a little numbers. For example, you may say, “Mr./Mrs._____ I have cash and can close very quickly. With that in mind, what could you sell the house for?” Furthermore, take it to the next step and say “Mr./Mrs._____ is that the best you can do?..........” and wait. This is the question they always say the first person to answer loses. Now you have earned yourself a lot smaller starting price to negotiate with after you have made your analysis.
It’s always good to have a script. Scripts are made up of questions. The presenters said it’s always good to have the same list of questions. And it’s how the sellers respond to your questions that tells you what kind of personality they have, their tone, and pace. You will then want to match all those, and I like to say effectively “level” with the seller. Or as Michael Q. would say it, "mimicking" the seller (Make sure to check out Michael Q.'s excellent blog on negotiating). Each call will be different though, it will be like a dance. You’ll dance around until you hit each question.
I have come to believe that there are 3 goals you should have for each phone call. If you meet those goals, you can feel confident that you have done everything that you can and then can move on.
- 1)Qualify the buyer’s motivation
- 2)Gain an understanding of the situation, what type of person you are dealing with and how to meet them
- 3)Talk numbers
Well, that's it everyone! That concludes part 3 of my 3 post weekend.
Like always, feed back is appreciated and feel free to open up discussions.
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