One of the biggest obstacles to new investors whom getting into our business of "Buying and Selling properties for a fast profit" is making offers.
Making offers is not their only problem, but it is the biggest obstacle holding them back from making gobs and gobs of sexy money; the formula is simple, the more offers you make the more successful you will be.
Well, I'm confident that by the time you finish this article you will not feel that same level of anxiety when it comes to making your offers, similar to when walking out of a restaurant bathroom with toilet paper still stuck to your shoe.
The bottom line is if you cannot quickly and confidently dictate an offer to either a seller or their representative; your investing career will be as short as Paul Mcartney's marriage to Heather Mills.
Let's analyze the mindset of a Renegade Investor, who's able to spew offers to sellers with their eyes closed and with the mindset that their doing the sellers a favor by simply making them an offer and giving the sellers their precious time...
1. First and foremost, YOU and I only want to make offers to motivated sellers, whom NEED to sell their home. If I'm making an offer to an idiot who wants top dollar, then I'm not following my own system and I didn't screen the lead good enough, to weed out the time wasting sellers who want top dollar.
2. I also absolutely hate to waste my time, I'd rather be at the beach or playing golf, then have a seller attempt to sell me on why they believe their home is such a gem.
That's why when I have taken the time out of my schedule to make a contact with the seller(s), I want to find out as quickly as possible how much their asking for their home and how flexible they are in their price point. This way, if their mindset is set on getting top dollar for their home, I'm not going to try to waste my time and try to sell them on the idea, that their a few sandwiches short of a whole picnic, because their not going to get top dollar in this market, and I can move on to bigger and better opportunities.
3. I'll also share with you an idea that once I realized this one thing, exploded my business to the moon. (Please Write this down...Genius) As long as you're buying the home at the right price, money is not an object or a problem at all, because hard money lenders will give you most or all the money to buy your deal. And if the lender won't cover the entire sales price, (a lot of them want you to have a little bit of skin in the game, and therefore want you to at least come up with 5% of the sales price) assuming again that you have a great deal, there will be more than enough other investors who would love to participate in your deal by putting up the 5% as well as any other monies needed to close the deal, for a percentage of the profits.
4. Also, when talking to sellers you need to learn how to shut up and listen to them for their Hot Buttons. Hot buttons are similar to truth juice, because I'll ask the sellers, "Why do you need to sell your home?" assuming again their not liars, their reason will tell me if there is motivation or no motivation. If they tell me, their spouse just lost his or her job and they need to downsize, bingo, now I know there is a level of motivation there for the sellers. You need to ask the right questions when talking to sellers, and then shut up and listen for their hot buttons that will tell you everything you need to know.
5. Last but not least, I do my homework. What do I mean by "do my homework"
What I mean is before I ever even start to make an offer to the seller(s), I do my research on the subject property, finding out what the property is truly worth. For example, before I ever even make an offer, I've already researched the comps (comparable sales in the area) on similar homes that have sold within the last 90 days. That way, I know the top dollar I can get for the property and then I work the numbers backwards.
Because I think this is so important for you to understand, let's take a look at a real-life example, of a great deal I just bought, known as 735 Airoso Ave...
? House is worth $90,000.00 once I fix it up (Also known as ARV or After Repaired Value)
? To fix it up, I need to invest $7500.00, to bring it to sellable condition.
? Holding costs, closing costs, insurance and miscellaneous is another $5,000.00.
? Subtracting the $12,500.00($7500 + $5000 = $12,500) from the $90,000.00, gives me $87,500.00.
? I want to make $30,000.00 net profit on this deal, because I'm a renegade stud.
? That leaves me with a maximum offer of roughly $57,500.00
? So when I made my 1st offer to the sellers, I told them I needed to be in the low $40's...
? They were so motivated to sell, in their situation; that we agreed to a sales price of $42,500.00.
? The seller didn't live in the home, she bought it for her son as an investment, and he screwed it all up and the property was now starting to go into foreclosure... But then she called me, from my outrageous marketing and the rest is history, the Fat Lady has sung her song!
Now If you think I'm B.S.'ing you, I'm not, you can pull up this property in public records, simply look up "735 Airoso, Port Saint Lucie, FL On public records and you'll see everything right there,
What can I say, when you're good, you're good! How many gurus will prove it to you, like yours truly...?
If you follow my recommendations on making offers, you should be able to make an offer to a seller with the same confidence I have, which is like being Tom Cruise at a single mom evening with the stars.
In closing, I'll share a brilliant quote from one of my mentors, Dan Kennedy, the world's best direct marketer and highest paid copywriter, commanding fees of $75,000.00 (plus royalties) to simply write you one sales letter, oh and by the way, that's IF he's willing to even take on your project, he has a waiting list of entrepreneurs begging him to write their sales letters and copy.
The only reason Dan is able to get almost six figures for his copywriting over other writers, is because when he quotes somebody his fee, he must be able to do it with a straight face, without even a flinch. And he's admitted he's not that much better than guys whom only charge $15,000 to $20,000 for the same service.
The same is true for you, as a buyer, you need to be able to make your offer without even a flinch. I suggest practicing and roll playing in front of the mirror making low-ball offers, and how you say it and your body language, as well.
