I spoke to a Wholesaler in my area last night, and he said, "How you communicate with your potential seller over the phone will have a direct impact on whether or not you will be able to negotiate and close on that particular property in the future." He then gave me the following scenario and question, which he said comes up often:
If a seller calls you and abruptly says, "Hey, I got your postcard saying that you want to buy my house. How much are you willing to give me?", how would you respond?
Although I didn't have an exact phrase in mind, I knew that I would have to figure out a way to redirect the conversation to bring it into a state of ease. Otherwise, I'm probably not going to get anywhere. He then gave me an example of something that he may respond with. In this case, he reverts to "the funny guy," in which he responds by saying something along the lines of "Jeeze Bill, I send out a lot of mail and to be honest, I don't even know what house you're referring to, and since I haven't looked at it yet, I have no idea what condition it's in. So I really have no idea what I can offer you. But I can tell you, it'll be more than a dollar." haha Now that the conversation is a little more tame, he begins inquiring about the property and the reasons for selling.
One of my biggest fears is that I will start speaking with potential sellers, and there will be moments where I'll be caught off guard and won't know what to say. I know that I will learn with experience, but I'm curious, what are some of the more sticky/difficult things that you've been asked by Sellers, and how did you handle it? What are some common phrases that you use in your phone conversations to keep the conversation light and flowing?
Outstanding question, a lot of people start their marketing without having practiced talking to sellers and you gave a great example. So here's my favorite example of what you're supposed to do. This was written by @Ken Min, it's great at helping you understand how to listen and build rapport with sellers. In this scenario, it's a pre-foreclosure but the mentality is the same. People think scripts are something you walk a buyer from point A to Z and that's not how it works. A script is more like roleplay scenarios with common things that people ask about or are concerned about, and how you can communicate effectively with the selling party by listening and understanding first, before trying to convey useful information to solve their problem. Diffusing emotion is what your friend did with that joke.
"First, I knew it was a pre-foreclosure so I knew there would be a lot of emotion involved. My first goal was to defuse the emotion. I would knock, and say that I was buying houses in the neighborhood and offering a variety of ways to buy the house.
That would usually pique their interest. Normally, they would say "what do you mean by that", which is a perfect opener for the various techniques I use (Subject, To, Wrap, Lease Option, etc) and that it didn't require fixing up the house or house "showings". I told them I am not a real estate agent so those fees could be saved. That would usually get me in the door if they were inclined to talk.
Once I was at the dinner table talking, I'd ask them what their goals are. (Solution selling.) I'd let them talk until they were finished. I'd write down on my pad what seemed to be their key points. It showed I was listening.
I would then ask them how much they thought the house would sell for. Then I would ask how much the principal is. That ALWAYS confused them. Which is good. They didn't know if I knew they were behind on their mortgage and weren't sure of the number.
So, I would simply take my pad and say "let's figure it out". I would write down principal, I'd ask if that included taxes, "does that include insurance", do you have an HOA, is there a second loan on the house, a HELOC or any unpaid child support liens, and then I would say, very casually "about how much will it take to bring the house current?, does that include legal fees? On rare occasion, someone would say "the loan is current" so I put down zero for that number without questioning them. With the others, I would put in the number (arrears) which meant that we all knew the house was in pre-foreclosure without having to use that nasty, emotional word.
I would then ask if a sale date had been set. I already knew the answer. Sometimes they did not know because they had never read the foreclosure notice. (Too afraid of the obvious.) I would tell them that there is always a solution, I had seven solutions available to me at the time, but not all solutions are equal. I would explain the pluses and minuses of each and then ask them which one I could help them with. More often than not, it was to give them "walking money", do a Subject To and take over their loan and give them 30 days to move. I would bring the loan current and that would help with their credit.
Door knocking pre-foreclosures works if you treat them as though they are people, and they are going through a tough time. Few people are in foreclosure by choice."
That's awesome Ray, and thank you for sharing!
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing