What does a motivated seller sound like? Pre-screening

Renter · Hialeah, FL · Member since 2014 · 239 posts · 27 votes

Hello to all. I wanted to know how you all specifically pre-screen sellers? How do you decide to make or not make an appointment to meet? What do you need to hear from them to know they are motivated?

I would appreciate specific answers, although I do know that we live in a relative world.

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Dev HornPro Member

Flipper/Rehabber · Arlington, TX · Member since 2013 · 1k+ posts · 2k+ votes

12y

I completely agree with some of my favorite posters here such as Mr. Q. But I would like to share perhaps a different PERSPECTIVE on this:

If all you are doing is wholesaling or cash purchase FLIPS, then everything above is the Gospel for that.

But here's the problem - wholesaling is NOT a viable business opportunity in most major markets because the cost of a lead is too high. It can easily cost $100 per call in a major metro. Wholesaling - using the narrow question set above - will work for about 1 in 20 leads. In a tight market, a wholesaler might only be able to mark up a deal $2,000. 20 calls at $100 = $2,000 - so what has the "wholesaler" made? ZILCH. You're busy, but you are making NO MONEY.

In the market we're in today, you need to have MULTIPLE WAYS to monetize a lead. For example - lease options, which are really as easy if not easier than wholesaling and can be more lucrative. Well, those questions above are 100% WRONG for lease option leads. How about listings? If you can't list the house, partner with an agent until you can, so you can sell those leads to your partner.

Your leads are a rare and valuable raw commodity. The goal of your business should be to MONETIZE EVERY CALL/LEAD if possible.

I like wholesaling but I just don't think it's a business. It's one product on your shelf - if you have different products that fit different needs, then you'd become more of a "solution provider" than a "flipper", more of a consultant than just another guys offering "fast cash as-is!". We have WAAAAAAY to many of those guys in the market right now. The future will not be kind to businesses with only one product on their shelf.

“We cannot become what we need to be by remaining what we are.” ~ Max DePree

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Bryan L.
Residential Real Estate Agent · Cookeville, TN · Member since 2013 · 1k+ posts · 948 votes
12y
@Jose Diaz - By far, without a doubt, the number 1 most important piece of information that I want from any lead is the address of the property. With the address, I will look it up online with the MLS, Google Maps street view, CRS (courthouse retrieval), etc. looking for the following info:
1. What type of house and what is the location. I don't even deal with manufactured homes at all unless they have some significant acreage.
2. Is the house currently listed, or was it recently listed? If so, how long on the market and at what price. If it sat on the market listed with the worst RE brokerage in town for 6 months at $119,900, then I know that the ARV is somewhere below this (at least 10% below) regardless of what the sellers are asking for it.
3. How much do they owe on it? I can get that through CRS. If they owe $117,000 on that house from #2 above, I don't waste my time on it.
Know this: Motivation does not automatically equate to a good deal. There are thousands of "motivate sellers" out there that owe 20% more than their house is worth. Don't waste any time on these unless you like to pursue long drawn-out short-sale deals. You need motivation AND equity (unless you are using some of the no or low equity plans that some on here do).
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Jose Diaz
OP
Renter · Hialeah, FL · Member since 2014 · 239 posts · 27 votes
12y
@Bryan L. Thanks. Its a good start to knowing what a motivated seller sounds like.
0 Reply
Michael Quarles
Flipper/Rehabber · Bakersfield, CA · Member since 2008 · 3k+ posts · 3k+ votes
12y
@Jose Diaz
We ask these questions before the address... For us the address isn't realavent unless the first four are answered correctly.
- Do you have a house you're wanting to sell? - Must be a Yes answer...
- Is the house currently Listed with a Real Estate Professional? - Must be a No answer...
- What do you think the house will be worth in today's market? - Must give a number...
- What is your "Rock Bottom" price, the lowest amount you'll sell for FAST and FOR CASH? - Must be a number equal to or less than the worth value...
- What is the address of the house?
Without the right answers to these five questions I don't continue with the questions on the rest of the seller questionnaire.
5 Reply
Jose Diaz
OP
Renter · Hialeah, FL · Member since 2014 · 239 posts · 27 votes
12y
@Michael Quarles Awesome! So if they give one "wrong" answer, you discount the lead?
Also, if you don't mind, what does the rest of lead sheet/questionnaire ask?
0 Reply
Rolanda Eldridge
Investor/Realtor · Hoover, AL · Member since 2010 · 1k+ posts · 459 votes
12y
1. How quick do you need to sell?
2. Why are you selling?
3. What's the condition of the property?
Ugly houses sell fast!!
1 Reply
Chris K.Pro Member
Investor · Baltimore, MD · Member since 2012 · 1k+ posts · 655 votes
12y
Hey Michael I'm curious why the house cannot be listed with a real estate professional?
0 Reply
Michael Quarles
Flipper/Rehabber · Bakersfield, CA · Member since 2008 · 3k+ posts · 3k+ votes
12y
I can not justify the advertising commission dollar to buy a mls listed property and since I won't buy off of the mls I also am not going to interfere in the listing agreement.
If a seller will go around their listing agreement what security do I have that they won't go around my contract.
1 Reply
Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
If someone calls me, and I am a motivate seller I will give the address and say if you are serious come see the home and let's talk and bring a bank statement so you want be wasting my time. Now if that person is a real buyer, they will show up.

Joe Gore
0 Reply
Bryan L.
Residential Real Estate Agent · Cookeville, TN · Member since 2013 · 1k+ posts · 948 votes
12y
I like @Michael Quarles 's approach for those who are just straight investors. But for me, I am also a Realtor, and I always try to leave the door open to getting a listing if it's something that I can not buy. Also, many of my leads come in by either email or text, so I just start out with "what's the address"? From there I can determine if it is currently listed, or recently withdrawn or cancelled (sellers often don't understand the difference between withdrawn and cancelled, so I like to verify it myself). And I can also determine the ARV and how much they owe pretty quickly with the address.
0 Reply
Mike M.
Longview, TX · Member since 2012 · 368 posts · 131 votes
12y
If you hear "make me an offer", thank them and get along your way. 95% of your calls will go like this and these folks have no intention of selling at a price you need to buy at. The owner of the house I just purchased flat out told me they are motivated over and over on the phone. The only one out of over 100 calls that expressed motivation and backed it up on a sales price.
1 Reply
Vincent Dicristo
NJ · Member since 2014 · 27 posts · 11 votes
12y
Joe Gore a truly motivated seller in my opinion is basically desperate to sell their house, so they're going to do anything they can to sell it, not trying to be in complete control of the situation as you're stating you would do.
0 Reply
Account Closed
Fishers, IN · Member since 2013 · 19 posts · 1 vote
12y
@Mike M. "make me an offer" sounds like they might sell low to me. I was surprised to hear that most people aren't motivated when they say that.
Is that what others have found to be true also?
0 Reply
Derek W.
Investor · Kern county Riverside County, CA · Member since 2008 · 494 posts · 261 votes
12y
Me: hi this is Derek
Seller: uh, um, I just got your letter in the mail
Me: oh, you're the one. Awesome. How can I help
Seller: (sniffle) I just want this nightmare to be over.
When a call starts like that, (and they do) I'm buying the house!
1 Reply
Michael Quarles
Flipper/Rehabber · Bakersfield, CA · Member since 2008 · 3k+ posts · 3k+ votes
12y
@Derek W.
I think I had a similar call. However rare... It does happen..
I think the best call comes from someone who KNOWs they are discounting their property and not guessing...
I had a conversation with a customer last week who told me they only bought one house from the 7000 postcards they sent. When I asked them how much they were set to earn they said over 50k... I will send out 2500 +- in marketing all day long to earn 20 times the expense.
If we wait for the motivated seller we will do a lot less work and make a lot more money...
2 Reply
Mike M.
Longview, TX · Member since 2012 · 368 posts · 131 votes
12y
David Stuffle My limited experience has been that folks that say that have no real intention to sell, have not thought about a price in any detail, and are just waiting for you to blow them away with an offer that's too good to pass up. As Michael Q. And Derek W alluded to, real motivated folks will either come at you with a realistic starting point or launch into why they need to sell. Getting back to Jose Diaz original question, I have wasted too much time visiting properties and preparing offers on folks who were nowhere close to where I needed to be. I try to get a number from them or sometimes I'll offer where I think I could be based on property details, Google maps, etc. and see if there's enough commonality to set up a visit.
0 Reply
Sebastian Caycedo
Real Estate Professional · Fort Worth, TX · Member since 2014 · 43 posts · 23 votes
12y
Any of the above are great examples of what you should ask.
I didn't believe any of this until I heard it for myself. After asking those exact same questions, a lady told me "I'll be honest I'll be leaving in 3 weeks whether the house sells or not, so if you want it, take it, it's yours!"
Those "desperate" cases happen at least once or twice a month. Of course you'll have to go through all of the "non-motivated" homeowners but usually after that 100th call, you'll hit your jackpot.
2 Reply
Troy Best
Real Estate Investor · Beaverton, OR · Member since 2014 · 37 posts · 7 votes
12y
I think a motivated seller is someone who is in distress about their property and will do anything to get you to take it off there hands. If at all possible you would want to find out the following
1. The address so you can do your research
2. Why they are selling so that you can figure out how to best help them to achieve a win/win situation for yourself and the seller if you can.
0 Reply
Andy Robison
Investor · Kansas City, MO · Member since 2013 · 465 posts · 170 votes
12y
Originally posted by @Derek W.:

Me: hi this is Derek
Seller: uh, um, I just got your letter in the mail
Me: oh, you're the one. Awesome. How can I help
Seller: (sniffle) I just want this nightmare to be over.
When a call starts like that, (and they do) I'm buying the house!
Care to share rest of the story?
1 Reply
Dev HornPro Member
Flipper/Rehabber · Arlington, TX · Member since 2013 · 1k+ posts · 2k+ votes
12y
I completely agree with some of my favorite posters here such as Mr. Q. But I would like to share perhaps a different PERSPECTIVE on this:
If all you are doing is wholesaling or cash purchase FLIPS, then everything above is the Gospel for that.
But here's the problem - wholesaling is NOT a viable business opportunity in most major markets because the cost of a lead is too high. It can easily cost $100 per call in a major metro. Wholesaling - using the narrow question set above - will work for about 1 in 20 leads. In a tight market, a wholesaler might only be able to mark up a deal $2,000. 20 calls at $100 = $2,000 - so what has the "wholesaler" made? ZILCH. You're busy, but you are making NO MONEY.
In the market we're in today, you need to have MULTIPLE WAYS to monetize a lead. For example - lease options, which are really as easy if not easier than wholesaling and can be more lucrative. Well, those questions above are 100% WRONG for lease option leads. How about listings? If you can't list the house, partner with an agent until you can, so you can sell those leads to your partner.
Your leads are a rare and valuable raw commodity. The goal of your business should be to MONETIZE EVERY CALL/LEAD if possible.
I like wholesaling but I just don't think it's a business. It's one product on your shelf - if you have different products that fit different needs, then you'd become more of a "solution provider" than a "flipper", more of a consultant than just another guys offering "fast cash as-is!". We have WAAAAAAY to many of those guys in the market right now. The future will not be kind to businesses with only one product on their shelf.
“We cannot become what we need to be by remaining what we are.” ~ Max DePree
6 Reply
Michael Quarles
Flipper/Rehabber · Bakersfield, CA · Member since 2008 · 3k+ posts · 3k+ votes
12y
@Dev Horn
Your calculations are exactly why I don't understand why anyone would assign an agreement to purchase at a huge discount.
Its so much easier to lock a property up at 50, 60, or 70 cents on the dollar and sell it for full value. The issue is the "knowledge" word for most. As they don't know where the money comes from. Or how to buy a property without purchase money funds even at 50% value.
It is one of the things I like about the We Buy Houses® System.... Besides a GREAT Lead generator, an AWESOME Brand, you guys actually help in the knowledge base...
Its clear that We Buy Houses® understands that for the Brand to be successful the Brand must create successful Investors.
0 Reply
Jose Diaz
OP
Renter · Hialeah, FL · Member since 2014 · 239 posts · 27 votes
12y
These are all great responses. @Dev Horn My plan is not to solely survive on wholesaling, however use it as a jump start to other "products" as you say.
Does anyone ask over the phone if there are any existing liens or outstanding hoa fees?
0 Reply
Rick Baggenstoss
Developer · Decatur, GA · Member since 2011 · 1k+ posts · 1k+ votes
12y
Great insight @Dev Horn! I do think it should be about solving the problem of the customer which allows the investor to monetize, often times, the lead.
"The sell your house now, my way" which I doubt is sustainable.
In my sales experience, we would differentiate between those who have a 'reason to sell' and a "reason to sell now". This dovetails with Dev's insights, but you still have to know who is going to do what when. It's a pipeline of opportunities near, middle, and long term based upon the many solutions you offer and the timing of your leads.
The question I like to get at motivation, timing, and the solution is two parts:
1. When would you like to sell your house?
2. What happens if you don't sell it then?
0 Reply
Derek W.
Investor · Kern county Riverside County, CA · Member since 2008 · 494 posts · 261 votes
12y
Originally posted by @Andy Robison:

Originally posted by @Derek W.:
Me: hi this is Derek
Seller: uh, um, I just got your letter in the mail
Me: oh, you're the one. Awesome. How can I help
Seller: (sniffle) I just want this nightmare to be over.
When a call starts like that, (and they do) I'm buying the house!
Care to share rest of the story?
Seller: Uh, um, I just got your letter in the mail
Me: Oh, you're the one. Awesome. How can I help
Seller: (sniffle) I just want this nightmare to be over.
Me: Oh, wow, what's going on?
Seller: My dad died a few years ago. Me and my brother inherited the property. I have my own house I live in with my family, so my brother stayed in the house. He lived there for two years with his loser druggie friends. They trashed the house.
Me: Oh, man. Isn't that crazy? Why do people do that, you know? Unfortunately, I see that a lot. It sucks. I'm so sorry to hear that. Are he and his friends still living there and trashing the property?
Seller: No, he died of a drug overdose two months ago.
Me: Oh, geez. I'll bet this hasn't been your favorite season of life?
Seller: No, it's not. And I just want it to all be over. (Starts crying) I just can't handle it!!!
Me: Hey, let me ask you a question...(I pause. It changes her state, she stops crying) Ideally, what would you like to see happen?
Seller: I don't even want to go back to the house. I grew up there. It used to be so nice! It had a beautiful green grass lawn and we had had a huge dough boy pool in the back yard and all my friends would come over and swim. I loved that house. I'm so mad it's gone.
Me: What's the address?
Seller: (gives address)
Me: So you're looking for someone to buy it in its current condition so you don't have to make any repairs or have to deal with it? Someone to help you get this all behind you?
Seller: Yes. And I know it's not worth what it used to be. Grrr.
Me: Did your dad leave a will? Have you opened probate?
Seller: It's in a trust and me and my brother were named in the trust, so I was told I don't have to go through probate.
Me: Bless your dad for thinking of that. It's so rare that people do, you know?
Seller: He was very detailed oriented
Me: that's awesome of him. I'm looking at the title right now. It looks like it's free and clear. No loan on it?
Seller: No
Me: It looks like there are about $3,600 back taxes. I guess your brother didn't bother paying them?
Seller: I didn't know that (cussing, whimper..)
Me: So, I could pay those for you. How much money down would you need after I pay the taxes current to pay off some bills and help you out?
Seller: I'm not sure, like maybe three thousand? You don think I can just get all cash for it?
Me: I'll bring you two offers, and we can figure out together which one fits your needs best.
Seller: (sounding excited and relieved) That sounds great
Me: I'll go check out the house, it's vacant, right? And then can I meet you Thursday sometime between 11-12? We will finalize our terms and open escrow. Sound good?
Seller: Uh, ok. But can we do 1:00. My son will be down for his nap then,so I won't be distracted.
Me: Perfect. See you at 1:00 on Thursday to open escrow. Thank you so much. We're going to get this wrapped up and behind you.
Seller: (deep sigh). Thank you.
3 Reply
Jose Diaz
OP
Renter · Hialeah, FL · Member since 2014 · 239 posts · 27 votes
12y
@Dev Horn Thats why am learning to be flexible and understand the different exit strategies. It allows me to solve their problem and gives me an opportunity for a deal.
0 Reply
Andy Robison
Investor · Kansas City, MO · Member since 2013 · 465 posts · 170 votes
12y
@Derek W.
Thanks! thats a sad story but I'm glad you were able to help everyone out. (I'm guessing you closed on it)
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