Well, for most people the natural and default response and reaction would be something in between, done in a haphazard manner rather than through careful planning and logical sequence.
So, what's the best possible response and reaction to take when you spot a great bargain and decide to go for it?
Well, after praying over it, the next logical and practical step to take is to achieve the following three (3) main primary objectives:
OBJECTIVE NUMBER 1
Why assemble such information from the seller that will help you interpret seller flexibility?
Well, because flexible sellers are much easier and fun to deal with compared to the other types of sellers. Moreover, flexible sellers make it possible for you to negotiate the price, terms and/or conditions of your deals according to your specific plans and goals!
Therefore, never waste your precious time and effort dealing with sellers who wouldn't mind not selling their properties as quickly as possible. Learn to target flexible sellers always. The secret is to be patient in your real property search efforts!
I discuss in greater detail what makes sellers of real property become flexible, clues or signs that can help you identify them as well as how to use such information to your advantage in order to strike win-win transactions for both you and the seller ->HERE!
So, how do you practically achieve objective number 1?
Well, the best way is to simply Ask The Seller Questions and Play the Role of an Interviewer. Period!
WHY? Because your first aim is to find out certain critical information about the seller that will help indicate to you how flexible he is as a seller!
And if this initial information gathering ends up revealing the quantity and quality of facts you are seeking, then you have the option of either purchasing the property out-rightly from the respective seller or if not, immediately make up your mind based on the information you've gathered and conduct your research and inquiry somewhere else.
So, as a consequence, the seller and not you should be doing most of the talking in order to get the information you want!
You must therefore exercise skill and tact as an interviewer and as a creative listener at the same time, while your counterpart (Seller) provides you with the vital information you need to help you make an informed decision regarding his status - whether he or she is a flexible seller or not!.
Since your first and primary aim in this case is to determine whether the seller is flexible or not in the first place, your line of questioning or interviewing of the seller must revolve around price, terms, conditions, timing and/or near-term seller activities.
Questions such as these listed below can go a long way indeed in helping you accomplish objective number 1. Questions such as:
"Why are you selling this nice piece of real property?" This question is intended to find out the main reason the seller is selling the property. Is it because of an impending court divorce? Is it because of personal financial constraints? Is it because of a transfer? Or is it because of succession issues? Etc.
"How soon do you want to sell your property?" This question is intended to help you find out how deeply motivated and quickly the seller wants to sell his or her property. If he or she is seriously under some pressure of some kind, the seller is very likely to discount the selling price as well as likely become flexible in his or her terms and conditions including the final date of closing or completing the whole deal.
"Would you consider a Lease Option - Purchase arrangement?" Such a question is intended to help you assess if the seller is open and flexible with regard to other fast sales techniques and therefore help you adjust your purchase option techniques as well.
"If I gave you an upfront full cash payment right away, what would your lowest price be today?" This question is intended to help you find out the seller's lowest and ultimate selling price he or she is comfortable with. Its also a quick and great indicator of seller flexibility when it comes to price reduction!
"How much of your equity or rather how much of your selling price would you need now?" This question is intended to help you assess if the seller is flexible in terms of paying for the property in installments!
These and many, many other questions not enumerated here can help you as a buyer assess seller flexibility from the onset when you contact the seller for the first time - whether via the phone or in person.
The point is, DO ASK - and then sit back and LISTEN to the RESPONSE attentively the Seller gives YOU. Period!
OBJECTIVE NUMBER 2
Therefore, your next line of questioning or interviewing must be directed to the subject property itself, with the aim of quashing any great and unreasonable high expectations of abnormal profits on the part of the seller which he or she might have in mind.
Questions such as these listed below can prove to be very helpful in achieving this second main objective. Questions such as:
"When was the last time you had the property's sewer pipe system flushed to the street as well as when was the roof last replaced including fittings and fixtures in the house?" Such questions help you establish or rather bring out some negative aspects of the property which the seller might have unintentionally missed out and thus help reduce the value of the property in favor of you as a buyer.
"Is this property mortgaged or its free and clear from any kind of encumbrances?" Such a question helps remind the seller of the financial commitments he or she currently has which might turn out to be a nightmare for him or her in the near future should he or she default for whatever reason and therefore make you emphasize to the seller how you may be a potential solution to such an impending problem!
"My children would have to walk a mile in order to reach the nearest school?" This question reminds the seller of the location challenges associated with his or her property which might make it very difficult for him or her to sell his or her property quickly to buyers if he or she doesn't sell the property to you on favorable terms and conditions.
"How would you want this property to be financed?" This question helps you find out whether the seller is open to other financing options other than a cash-payment only method.
"Don't you agree with me that this property of yours is located in an area where there have been a series of serious robberies of personal properties as well as loss of lives coming as a result of armed bandits?" This question highlights to the seller the social ills associated with his or her property's location even though the property might be a neat piece of good workmanship that attracts a good selling price. But because of the social ills associated with the property's location, this seriously and negatively affects the property's value in the final analysis. And that therefore, you might be the ONLY one ready to risk buying such a piece of property and that he or she stands to loose an eminent sale that could have served him or her the headaches of selling such a piece of real property located in such an unattractive environment that a number of potential buyers wouldn't want to buy.
These and many, many other questions related to the subject property at hand can enable you accomplish objective number two (2) elaborated herein and therefore help you make a proper and informed decision regarding such a piece of real property you may have seriously declared interest in!
OBJECTIVE NUMBER 3
The final and third objective you must accomplish when you happen to contact the sellers or owners of real property on sale for the very first time is to do this: Build Trust!.
Why Build Trust? So that the seller ends up having strong Faith and Confidence in You that you're going to abide by the terms and conditions you initially agree upon with them. Period!
Therefore, dear real estate investor, in your efforts trying to accomplish objective number 3 discussed herein, make it your top priority to Build Trust so that the seller shall eventually Trust you enough in finishing paying the full asking selling price according to the terms and conditions of the agreement you work out with him or her especially in a transaction where you happen to put down very little or no money at all.
And the very best way to "buy" his Trust is to give the seller a hefty upfront cash down payment or some other form of valuable consideration equal in value to what the seller might have reasonably accepted had you paid him or her in liquid cash if you have it that is. This way, he will know that you won't walk away from him as well as his property. You're going to stay around and commit yourself to fulfilling your obligations according to the terms and conditions of the agreement. Otherwise, should you fail to honor your obligations, the seller will be entitled to reposes the property and you may stand to loose not only a pre-calculated percentage of that hefty upfront cash down payment you had paid him initially but also any appreciated value above the seller's equity or selling price.
One highly effective strategy I seriously recommend you apply in helping you accomplish this very objective of Trust Building quickly is to offer the seller some form of unconditional bait in the form of an open ended question such as this one below:
"If I gave you a K1,000 (approximately $200) non-refundable but deductible from the total purchase price money, would you give me the exclusive right for a period of say six (6) months or so to purchase your property using the property's title deeds to help me raise the remaining purchase price money?" This question together with the bait of a little non-refundable amount of down payment money is intended to help you Build Trust instantly as well as help you find out if the seller can permit you to use the property's title deed documents to obtain further financing from a financier of your choice. Moreover, this helps make the seller to be at ease knowing that You're going to stay around because of the money at stake and commit yourself to fulfilling your obligations according to the terms and conditions of the agreement you sign up with him or her.
So, in conclusion, the very next time you get in touch with any seller of real property for the very first time either in person or on the phone that is, make sure you remember to accomplish these three (3) main objectives FIRST before you do anything else or before you get into any serious negotiations whatsoever!
Hope this has been of great assistance to You.
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