Posted about 2 months ago

Use This Checklist To Diagnose Why Your Deals Might Be Falling Through

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When you look back on your successful deals, you feel a sense of pride and accomplishment… and probably a drive to do even more deals. After all, we all got into real estate investing to give us the lifestyle we desire while also being able to help people.

But if you want to do more deals, then here’s an important and of

ten-overlooked truth: it’s not necessarily the deals you’ve DONE that will reveal how to do more… it’s actually the deals that FELL THROUGH that can reveal where you can make improvements.

Use this simple 5-point checklist, and the action steps with each item, to help you identify where you can strengthen your marketing, sales, and deal-making process.

The Checklist

Here is a simple deal-making checklist that you can review after every failed deal to identify where you might have missed out on the opportunity (and then use that information for next time).

#1. Find the right person and the right deal

#2. Highlight their pain

#3. Demonstrate a clear, compelling, unique solution

#4. Build trust

#5. Build urgency

Let’s look at each one. I’ll use the example of finding a deal with a motivated seller but the insights are just as true if you working with cash buyers or others.

#1. Find The Right Person And The Right Deal

Investors can often just try to find ANY deal instead of the right person and the right deal. We can unconsciously fall into the trap of thinking that “it’s just a numbers game” and the more people we get in front of, the more deals we get access to. But that’s only true to a point.

If you’re finding that people are closing the door in your face or not responding to your postcards or bandit signs, you probably don’t have the right person… and if you find the numbers don’t work out then you probably don’t have the right deal.

I’ve turned down MANY deals because the numbers don’t work and I have to constantly battle against the temptation that “the numbers are almost good! Maybe I can make it work!” It’s better to just keep working the phones or driving for dollars or sitting on capital until the right deal comes along than to jump on something that you hope is a good deal.

Action Steps:

· Identify exactly WHO you serve best and figure out how to reach them… and ignore all other deals

· Identify the very best parameters of deal numbers that work for you… and ignore all other deals

· Take a close look at your marketing and figure out what you need to say differently to communicate directly with your best audience for the best deal. For example: “We buy houses for cash” might get you a very different kind of deal than “we buy divorce houses”—the first tagline might get you a lot of fixer-uppers; the second tagline might get you nicer houses but ones that have more complex legal details to navigate.

(Pro tip: Yes, there might be good deals that you’re giving up, so if you come across a lot of deals that are great deals but not the right deals for YOU, then find an investor who they make sense for and work out a referral fee with them. That way, you’ll still benefit from referring a good deal to someone else when it’s not the right deal for you.)

#2. Highlight Their Pain

Once you’ve found the right person and the right deal, then you need to highlight their pain. You’re not doing it in a way that is hurtful; rather, you’re doing it to check that you’ve been successful in the first step (find the right person and the right deal) and you are agitating the situation so you can set yourself up to solve it.

You see, people’s internal sense of pain and frustration isn’t always present. It comes and goes in waves. During the day, when they are busy with work and kids, they may not be thinking about it. If they see your postcard at that time, they may throw it in the trash because they have a crying kid or a loud boss to deal with. But later, when they are laying in bed at night before falling asleep, they may start to think about the challenges they’re facing with their house and the financial constraints it’s creating for them, and they may go fish your postcard out of the trash to call you.

Therefore, you need to highlight their pain. It’s not just about “we buy houses for cash” but “we buy houses for cash so that you can get out of that oppressive high-interest mortgage and finally have money to pay your bills” or “we buy houses for cash so that you can get rid of your late parent’s house to free yourself from the extra burden of having to take care of a house you don’t want to be reminded that you own.”

If you’re trying to do a deal and the person doesn’t seem interested (and assuming you have the right person!) they either aren’t feeling enough pain at the moment.

Action Steps:

· Expect to market to this audience in multiple ways; if possible, use different methods for follow-up (postcards, letters, emails, face-to-face… whatever you can).

· It’s okay to use punchy marketing (like “we pay cash for houses”) but the more you interact with a specific owner, the more you should add pain-highlighting words to your messaging. For example, when face-to-face with them, ask them about what the high mortgage payments are preventing them from doing in life.

#3. Demonstrate A Clear, Compelling, Unique Solution

Once you have found the right person and deal, and after you have highlighted their pain, then you need to present a compelling offer.

If you get shut down at this point in the deal-making process, it’s because your solution was not clear, compelling, and unique.

· “Clear” – it needs to be quickly and easily understood by the other person. Remember, a confused mind says “no.”

· “Compelling” – it needs to solve their problems and alleviate the pain you just highlighted in the previous step.

· “Unique” – it needs to present you as the only person who can help them (otherwise, they’ll work with whatever investor is most convenient or offers the most money).

Action Steps:

· Create a clearer offer by building short explanations and metaphors that they’ll understand. Don’t use lingo or acronyms that the seller doesn’t understand.

· Create a more compelling offer by showing how your solution specifically addresses the exact pain points they’re feeling. When possible, use the exact language that your audience would use to describe their situation.

· Create a unique offer by strengthening your brand, and then working that brand through all of your marketing pieces. (For example, if you are XYZ Home Buyers, then your solution for motivated sellers should be called “The XYZ Home Buying Process™”

· And don’t forget: ASK to do the deal! Many deals are lost because the investor assumes that the motivated seller will say “yes! What are the next steps?”

#4. Build Trust

Now that you’ve made an offer of a clear, compelling, and unique solution, it’s a question of whether the other person will do the deal with you. There are many reasons they may not but one of the biggest is that they don’t trust you.

And why would they? If they barely met you, they may not feel that you have their best interest at heart… especially if they have been struggling through the challenging bureaucracy of banks, creditors, or government agencies who clearly want to take something from them.

But, you’re reading this because you DO have their best interest at heart… and in this step you need to show them.

If you get to this point in the process and a deal falls through, it’s likely because you didn’t build enough trust. Fortunately, there are many ways to create trust.

Action Step:

· Start with empathy. If all you ever do is listen, listen, listen, then you’re well on your way to being empathetic… and that creates trust.

· Use the same words that the other person is using to describe their situation. This helps to build an immediate connection of trust because it shows you that were listening and that you “get” their situation. (In fact, some copywriters will tell you that you don’t even need a great offer, all you need to do is simply re-describe the situation to the other person in the same words they use and you’re already 90% of the way to closing the deal).

· Demonstrate how you have helped other people by using testimonials and case studies. In fact, you cannot use enough of these. Collect them and build them into a book of case studies.

#5. Build urgency

Do you procrastinate on something until the last minute? Join the club. Most other people do too. And the more challenging the situation is, harder it can be to take action, even if it’s the right action. One of the weird quirks of being human is that our sense of urgency doesn’t always match the true urgency of a situation.

If you’ve done all the steps above and the deal falls through now, it’s likely because the other person does not feel the sense of urgency that they should. Fortunately, you can help solve this to keep the deal moving forward a timeline that works for you.

Action Steps:

· Keep highlighting their pain… and how your solution will solve their pain.

· Create mini deadlines during the process so that, even if they procrastinate for each deadline, they’re still hitting deadlines and getting things done.

· Create content that shows the person how to take action. Make it clear to them and break it down into really simple steps. A great tool here is a one-sheet checklist that clearly spells out the actions they need to take at each step.

Summary

Not all deals come together the way you want them to come together. Fortunately, you can do something about it! This diagnosis checklist gives you some practical action steps to take. Simply go back to every failed deal and review why it didn’t come together, and then build the content, strategies, or action steps to solve it in the future.



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