What to Say When Talking to Sellers

    By this point, you’ve found a nasty-looking house that needs work. You’ve looked up who the owner is, and you’ve even found their contact information. The research is done, so all that’s left is to have a little conversation with them to see what’s going on and see if they’re ready to sell this liability that some people call a ‘house.’

But what do we SAY? And HOW do we say it? Relax. You’re about to learn just that. And you’ll be happy to know that it’s actually quite simple. But before you even open your mouth, here are a few important pointers to keep in mind when talking with these sellers:

• Be honest and transparent. Sellers are more likely to trust you if they know that you’re being honest with them about the condition of their house and your intentions. If they don’t trust you, you’re done. Game over. If they do, it’s game on!
• Be respectful. Even if the house needs repairs, it’s still someone’s home. Be respectful of the seller’s property and their feelings. Don’t insult them or the condition of the property. A better way is to ask questions to test their awareness of the situation.
• Be prepared to make an offer. If you’re serious about this business and know that your success depends on getting houses under contract, then you should be prepared to make an offer. This shows the seller that you’re serious about buying and that you’re willing to put your money where your mouth is. Of course, they don’t need to know that it doesn’t have to be your money. And when it comes to making an offer, you already know how we like to do it: By asking the magic questions to get them to make us the offer! More on that in a moment.

With that in mind, here’s a very basic and superficial example of what your conversation with a seller could sound like:

“Hi, I’m trying to reach the owner of [ADDRESS]. Is that you?” (Say it in a curious tone)
If yes: “Great! My name is [your name]. What’s your name?” They give their name.
“Nice to talk to you, NAME! Again, my name is [your name], and the reason I’m calling is because I buy houses, and I might be interested in buying your house. I’ve seen it from the outside and I know that it needs some repairs, but I think it has a lot of potential.
I’m willing to make an offer… Would you be interested in talking to me about it?”

That’s a great opening & introduction to a call with the owner of an ugly house, because it’s efficient and to the point. It first asks if you’re talking to the right person. You quickly introduce yourself, you state your intention, and then you ask if they would like to talk about what you can do. If they’re still on the phone & give permission to discuss things further, you’re already well on your way!

If the seller truly is interested, you can then discuss the details of your offer and the repairs that need to be made. You can also talk about your plans for the house and how you think you can improve it. But keep in mind… The less you say, the more you’ll make.

So after you’ve gotten the introduction out of the way, what you’ll want to do next is simply gather some essential information about both the house and the seller. They’re both important.
A very simple guideline would be to just follow the same info you’d gather in the Property Information (PI) Sheet. Feel free to use my script form for that, of course. Begin in the ‘About the House’ section.

Some of the vital questions you’d want to ask here include, “So what can you tell me about the house? How many beds & bathrooms? How many square feet? What work do you think it needs done to make it top-notch?”

You’ll also want to find out the mortgage info – do they have a mortgage on it, or is it owned free & clear? If there’s a mortgage, find out the approximate balance(s) owed, the monthly payment amount, and if it’s current or behind.

After you find out about the house, see what you can find out about the owner. Why haven’t they sold the house yet? Have they tried? What did they do? Why don’t they just fix it up and list it? What would the like to have happen?

Make sure you have them feel like you’re on their side. You’re just gathering info to see what you can find out to see if you may be of mutual benefit here.

It’s important to be patient and persistent when trying to buy a house from a seller. There may be times when the seller isn’t interested in selling, but if you keep trying, you’ll eventually find a seller who is willing to sell to you. This is why…

It’s also vitally important to focus on prescreening this potential seller and be ready to follow up with them. It’s rare that you actually get someone who’s ready to do business on the first phone call. Always remember that you’re probing for flexibility and motivation. I refer you to my article on Following Up: “What? You Don’t Want to Sell Me Your House?! F.U.!” (opens in a new tab)

But let’s suppose that you’re able to sense that this seller does have some interest in selling. The next thing you’ll want to move toward is to see about making an offer! Remember, the more offers you make, the more deals you’ll do, and the more money you’ll make! So.

As often as possible, you’ll want to push to make an offer with as many people as possible. But how the heck can we do this without really going and inspecting the house and thoroughly seeing it in person? Well, I’m about to tell you…

How To Make Offers, Sight Unseen

Remember, as you continue talking with the seller, you’re keeping your ears open for their interest in selling. Whenever possible, you should always look to see if you can make an offer on their property before you get off the phone. As with anything, there’s a right way and a wrong way to make an offer!

The WRONG way of making an offer: The wrong way is for you to crunch numbers, go out and estimate repairs, get bids from contractors, and anything else that has you doing the hard work here. The trouble with all that is that while you’re out there thinking about what to offer, getting bids and all that, someone else is coming in right behind you and snatching up that property so fast it will make your head spin. I’ll explain all this in further detail in just a moment.

The RIGHT way to make an offer: You should already have a great idea of this. And the good news is that it’s simple, fast, and super easy: You ASK the magic question. And it goes a little somethin’ like this…

“NAME, if I were to pay you all cash and close quickly, what’s the least you could accept for this house?”

The “All Cash” Script Question

And SHUT UP! (That’s the hard part for a lot of people).

If/when they come back with a number, your immediate reaction should be (wince),

“Ohhhh… Is that the best you can do?”

You should recognize that simple script. And you should practice it every time you’re buying something (not just houses). Those little words right there will save you SO much $$$, starting immediately. Use it in good health.

UPDATE! I just created a very powerful & easy to use TOOL for you!

Here’s the details: Have you ever wanted to know how to figure out the all-cash Maximum Allowable Offer (MAO) for a property? Yes, this is something you should definitely know, but if you would like a little helping hand, I have you covered with this tool.

Introducing: The Cash Offer Calculator

Just click that link & you’ll get access to this cool new tool I just made for you. It will quickly & automatically help you calculate the WMAO for any property. It guides you through the whole process. Very cool & very simple. Check it out…

When To Do Your Due Diligence

I’m going to share some secrets with you. Once you wrap your head around this, it will change everything. Let me just break it down for you like this… Are you ready?

Here are a vital few fun facts you should know:

1. You don’t actually need to do due diligence until AFTER you get a property under contract. I know – that’s a mind-blower to thinker brains!
2. Getting a property under contract gives you the RIGHT, but NOT the obligation to buy it.
3. Even if you mess up your contract, you can always fix it later! That’s right.
4. If your offer is too high, you can come back and renegotiate later! This will make you money, and if you can’t make it work, just walk away. The worst that can happen is you lose your binder deposit ($10-$100)

The Take-Away: You can make an offer on a property and even get it under contract without seeing it, because of those facts above. Once you get a property under contract, that’s when your true due diligence begins. That’s when you’ll want to get your repair estimates done and do your marketing to find a proper buyer (which is a lot easier if you already have a decent buyer’s list, of course).

How To Get a Property Under Contract

Getting a property under contract to purchase is hard. The first time. Or two. After that, it gets a lot easier and more fun! Basically, there are three main ways:

1. Present the contract in PERSON. Go out to meet the seller, preferably at the house, to look at the property and get the contract signed there while you meet with them.
2. Present the contract virtually, online, via Docusign, Hellosign, etc. (I’m actually building a new site that has everything included in it, so stay tuned!). You’d prepare the contract and upload it to one of those sites, then get the seller on the phone while you go over the contract with them.
   I may write an article about this with more detail about this strategy if enough people request it.
3. Have someone else prepare & present the contract for you (such as a truly Realtor/Agent or your acquisitionist). Tell them the price & terms you want to present, and let them do it for you!

So those are the main ways of presenting an actual contract. Remember that your objective is to first get an oral agreement, then put that agreement in writing, and have both parties sign: Seller (them) and Buyer (you, preferably on behalf of your entity). Congratulations! You now have a ratified contract agreement signed, and that’s when the real fun begins!

What To Do Next (After Getting it Under Contract)

Immediately after getting a contract signed, your very next step should be to contact your closing attorney/agent and send them that agreement, along with your intended exit strategy and instructions to check the title. This shows you who the real sellers/owners of record are, as well as any liens or title issues that need to be addressed and resolved in order to sell with clean title.

The next thing you’ll need to do is get a few repair estimate BIDS for doing the work. Please note that I said to get a FEW of these contractor estimates. Why? Because they all vary. Different people and companies do different levels of work – at different prices. Just know that you’re probably not going to use them yourself for the repairs, so there’s no commitment here yet. You’re just trying to get a repair estimate.

You’ll then use the average of those repair estimates in your deal presentation package you’ll show the seller that will give them an approximation of their profit.
Just make sure you jump on getting these repair estimates as quickly as possible so that you get them done during your inspection period you’ll want to have on the contract (Paragraph 18: “This agreement is subject to a 14 day inspection period, to be performed within that time frame after acceptance”)

Is all this making sense? Go back and read again if you need to.

How To Make Money With This Strategy

Ok, in case you’re wondering how you’re supposed to make money with this DFD Strategy, the answer is: It depends! There are several related exit strategies you can use with this technique. Certainly, the most popular, least costly, least risk, least hassle strategy for this is: Wholesaling! You’ll just find a qualified cash buyer – usually an investor who intends to fix it up (rehab) the property and sell it to an owner occupant (retailing). This should make you a quick $5,000-$100,000+ profit with basically no risk and no significant $$ out of your pocket.

When you do this strategy, the fastest & easiest way of getting it done is by assigning the contract. In order to do that, you’ll need an assignment of contract for filled out & signed by you and your cash buyer.

Need help with that? Well, it just so happens that I have you covered here as well! I just created yet ANOTHER powerful cool tool for you to use: The Assignment of Contract Generator!
Like my other Generator tools, it’s really easy to use. Just fill out the simple interface & click the button, and BAM! Out pops a properly filled-out Assignment of Contract for you to download & use!
Grab it Here:

After You’ve Done a Few Simple Assignments…

After some time, you may get the ‘rehab bug’ and choose to actually close on the property (usually using private or even hard money funds), then fix the property up and retail it to an owner occupant for the big bucks!

Warning: I strongly suggest you NOT do that until you’ve done a few other deals, have a decent contracting crew (or two) available, and know how to sell these houses. Note that for selling those rehab properties, it’s totally ok to list them with a qualified real estate agent, because they’ll most likely get you the exposure you need to get the big bucks. Remember, you’re buying on cash, so you’d look to sell for cash.

There are other ways of doing deals when you find properties this way. You can do terms deals. You can do Work For Equity deals. And more. But those are on the advanced side, and we just don’t have the time to get into all those other strategies here and now.

So in the beginning, just stick to wholesaling these deals, ok? That’s why I didn’t really mention terms too much in this training.

Ok, Let’s Wrap This Up!

As we wrap up Part 3 of this course, let’s update the essential…

Tips for Making the Most of “Driving for Dollars” (Parts 1, 2 & 3)

1. Be persistent: “Driving for Dollars” can be time-consuming, so it’s important to be persistent in your efforts. Set aside a specific time each week to go out and drive around.
2. Be strategic: Focus on neighborhoods with a high concentration of older homes, as these are more likely to need repairs.
3. Be organized. Don’t just fly (or drive) by the seat of your pants. Keep track of your potential leads, how they develop, who you made offers to (covered later), and who you need to follow up with and when.
4. Follow up quickly: Once you’ve identified a potential property, it’s important to follow up quickly. Find who owns the property. Get their contact information. Get ready to contact them using one of those methods above. Remember – The longer you wait, the less likely the owner will be motivated to sell.
5. Look to get the owner on the phone. Use the conversation guidelines in this Part 3 training.
6. State your intention for calling and see if they’d be open to talking about selling their house, then gather the essential information you need to…
7. Make an offer! Do the best you can to get THEM to make YOU an offer by using the simple ‘All Cash Buying Script’ (given above).
8. Do your best to get the property under contract. Know your exit strategy before you enter.
9. Send the contract to your attorney/closing agent (fax or scan/email) to check the title asap.
10. Immediately get contractor estimates and put numbers together to market the property to your buyer’s list/We Buy Houses guys.
11. You’ll learn some great tips, shortcuts & much more in Part 4!

And In Conclusion (for now)…

How are you enjoying this training so far? Is this good stuff or what? I hope you’re putting what you’re learning here to good use.
Quick Recap: Up to this point, you’ve learned WHAT Driving For Dollars is, WHY it’s so useful, and HOW you can get started today with a few simple starting strategies. That was just in part 1.
In part 2, you learned how to find who owns the houses you found using the county tax rolls AND how to get their contact information, as well as the different ways of contacting these people.
Here in part 3, you learned WHAT to say to sellers and HOW to make an offer, then how to get a property under contract, and what to do right after that.

But we still have ONE MORE part to cover! Here’s what’s coming up:

In Part 4 (the Final), we’ll recap everything. I’ll share some special tips to make it so easy. I’ll show you how to get others to do this for you, and if I’m feeling generous, I’ll even give you a BONUS method of how to use this for PRETTY houses (So simple)!

So stay tuned and be sure to check out that next part as soon as it’s ready!

See you in Part 4,

Tony Pearl