Don’t Make AssUmptions About Your Buyers

As a real estate investor, I take lots of calls. The goal is to pre-qualify the buyer or seller as to be as efficient as possible.

Example. If you are selling an investment property and a person tells you that they are paying cash, you want to know that they actually have the cash in their account to purchase the property.

A person can sound smooth on the phone and say all the right things, but not have jack to back it up. A person can seem a little rough around the edges, but be a performer. The lesson is to not put the former on a throne and the latter in the trash. Always dig deeper and get the facts.

2 case studies.

1] We recently had a wholesale deal that had me sweating bullets as I rushed at the last minute to put the deal together. The buyer of the property paid cash. Here's the kicker. This same ''buyer'' had called us before that trying to sell their property, as they were facing foreclosure. Logic tells you that someone facing foreclosure can't buy another house. I'll be honest, I thought the same thing. This buyer was persistent and kept calling, calling, calling. I told her that before I would even show it to her she would have to get me proof of funds. Well, 2 weeks later, she called to ask for my fax number. She had the cash. I showed her the property and she bought it.

2] We got an REO property under contract for $12,900 (it was listed at $11,900).

We had about 30 days before we had to close so we marketed the heck out of the thing. One particular call went something like this: "I love it, I want it, shamalamadingdong, I got $10,000 cash under my bad, asdasdffoidsfjadf, I can go get it right now!" Obviously I think this person is never going to buy this property. So I said, "I'd prefer you get a cashier's check from a bank rather than cash and you need another $10,000 in order to buy this property." "I'm gonna have the credit union lady call you today!" About an hour later my phone rings. It was the credit union. She said that she was giving the buyer a personal loan to buy the property. The credit union didn't care that the money was being used for a property --- they were giving her a personal loan. We ended up selling the property to this buyer for $20,000

Lesson to be learned: Don't assume that your buyers can't perform.

View my other posts here.