Epic Real Estate Investing - EPREI 039 : What to Say When Motivated Sellers Call You

Episode Date: August 12, 2012

One of the bigger hurdles real estate investors experience is their lack of confidence in knowing what to say to motivated sellers when they're prospecting. When their real estate marketing begins to work and the phone starts to ring, many are afraid to pick up the phone. Either they're afraid of messing up the deal, afraid of looking silly or afraid of the seller themsevles. Really what it boils down to is fear of the unknown. Real estate investing can be a daunting trade to pursue, but any trade that offers the types of financial rewards that real estate investing does will not be without its challenges to the novice. If there were nothing challenging about it, everybody would be living off of real estate riches experiencing financial independence. Unfortunately, there is no way to disappear this fear other than facing it. However, armed with an easy three step easy-to-follow process, facing this fear doesn't prevent itself as the seemingly insurmountable task that it is to most newbie real estate investors. On this episode, Matt shares his easy-to-follow three step process to sort the suspects from the prospects so that you can spend more of your time where it's best spent... talking to motivated sellers and creating investment income. You can get started invesitng in real estate even if you have little to no money, credit or experience by downloading Matt's free real estate investing course at http://FreeRealEstateInvestingCourse.com Learn more about your ad choices. Visit megaphone.fm/adchoices

Without further delay. Your guru. Sorry. Your guide to a better life through real estate investing. Matt Terrio. Hello and greetings from the epic real estate investing podcast. This is episode number 39. And this is the podcast that's going to show you how to build wealth through creative

real estate investing. So you'll have the option to realistically retire in the next 10 years or less. And enjoy the good life while you're You're still young enough to do so. My name is Matt Terrio, author, full-time real estate investor, and family man. If this is your first time listening to the show, welcome. Glad that you're here. And now you're going to want to do two things.

First, I want you to go back and listen to Episode 1 for the Ground Rules of the Show. And two, download the free real estate investing course, how to do deals, no money required. And you can get that at free real estate investing course.com. No fancy spellings, no hyphens, no spaces, no nothing. just free real estate investing course.com. It's a step-by-step course of where I unveil the mystery around doing deals with no money or credit. And, you know, to this point in my career, I've implemented 12 different strategies of investing in real estate using none to very little of my own money. And I've yet to use one point of my own credit score.

And inside of this free course, I give you the first two strategies of which are really the easiest two. And they are the two that can generate the quickest success for you. And you can get those for free at free real estate investing course.com. All right. So a couple of episodes ago, we discussed why your yellow letters aren't working. And if you miss that episode, you're going to want to go back and listen to it. I think it's, yeah, it's episode 37. Episode 37.

Because it's not just why your yellow letters aren't working. It's really why all of your lead generation isn't working. I mean, it's probably one of the more important episodes. that I think I've really ever recorded. And I got a lot of great feedback in. And I went back and listened to it again myself. And I just, I said it exactly how I wanted to say it. As the engine that runs your entire business is your, it's your lead generation.

So if you're not generating leads, you're not finding deals. And if you're not finding deals, you're not writing offers. And if you're not writing offers, you're not investing in real estate. but it all begins with your lead generation. So go back and listen to that episode if you missed it, okay? And if you did listen to it, I mean, it probably wouldn't be a bad idea to listen to it again with this perspective inside of a new context.

You know, because one of the more common questions I get is, where do you find deals? Hear that all the time. Or what's the best way to find deals? Or what's the fastest way to find deals? Or what list should I send my yellow letters to? or what website should I advertise my deals on or what type of landing page should I do?

I get all the where to find deals is probably the most common question I get. And it's understandable because it's probably one of the more challenging parts of this business. You know, but there's only one way to get motivated sellers to call you. There's only one way to get them to call you.

And that is to keep a steady and consistent message in front of them. Okay? that's how you get motivated sellers to call you to keep a steady and consistent message in front of them. And for the greatest results, you want your message to be everywhere, because motivated sellers are everywhere. You know, when your message is everywhere, that's when you generate leads. So if you feel your message is everywhere and you're still not getting the results you want, that's why you want to go back and listen to episode 37, all right?

So I'm going to assume for the rest of this episode that you have listened to episode 37 or you're going to listen to it and I'm going to assume that you're going to move at the speed of instruction. It's so important. So your phone is ringing, right? You're talking to motivated sellers and you're analyzing deals. The next question that I frequently get is, how do you know when you've found a good deal? How do you know good deals from bad deals or how do you know good deals from great deals?

or how do you know deals from no deals? Well, what tends to discourage and derail investors more times than not is that they chase too many leads that look like deals, but they're not. And it's very easy to do, especially when you're new. And I mean, and especially when you're marketing and all the marketing that you're doing, you've got your message out there in front of motivated the sellers, when all of that is working and the phone is actually ringing, I mean, that's an exciting time,

if you've ever experienced that before. It's exciting when your lead generation is really coming together and the phone is ringing. And it's easy to chase every suspect that you encounter. And you will encounter them. Suspects. Lots of suspects. As opposed to prospects. There's a difference.

You know, and until you get some experience under your belt, it can be tough to sort those suspects from the prospects, to be able to tell the difference. I mean, shoot, even with experience, sometimes it can be tricky. Now, although there's really no full-proof way to avoid wasting time with the suspects, there is a way to avoid wasting a lot of time. And it's called qualifying your leads. All right. So let's go over how to qualify your leads when they call you. All right?

So you've got your website up. You've got your little ads out there. You've got your online ads, your offline ads. You've got your business cards. You've got your flyers. You've got your roadside signs. You've got all of your marketing working. and they call you.

How do you qualify them? How do you separate the suspects from the prospects? Well, I've narrowed it down. It only takes three simple questions. And I've talked to different people and I've heard different approaches and some people sit with a big, giant, long script by the phone. But I think you can really do it with just three simple questions.

All right? So it goes like this. The phone rings. And when you answer, the seller on the other end will say something along the lines of, hey, I saw your ad or I got your. yellow letter or I saw your ugly yellow sign on the side of the road and in a very relaxed manner, it's, you know, it's no big deal to you, right? You'll say, great, cool, tell me about your situation.

That's the first thing you say. Tell me about your situation, right? And after you say that, just be quiet and listen. That's all you got to do. Tell me about your situation. Be quiet and listen. Remember, your people skills. You got to listen more than you speak.

especially during this process. And when you do speak, you want to be asking questions. That's what you're going to do when you do speak. You ask questions. Now, when they're done telling you their situation, your next question is, what do you want to have happen?

That's the question. What do you want to have happen? And again, listen. Great. What do you want to have happen? And if you listened and heard them out with the first question, they'll tell you exactly what they want to have happen. And why will they tell you?

Well, they're going to tell you because they're starting to like you. Well, how is that so with just two questions? They're starting to like you. I mean, it's funny sometimes how it plays out. I mean, you just listen to their situation, and you showed interest in their situation, and because you are interested, to them, you are now interesting.

That's how you get people to be interested in you. you need to be interested in them. And because you were interested in them, to them you were interesting. And people like interesting people. Get it? See how that works? Now, their answer to this question, what do you want to have happen? This is the information that you need to start figuring out how you're going to create

a win-win scenario out of this transaction, if they indeed turn out to have enough motivation to sell, right? The answer to this question is going to give you the answer to the answer to ammunition that you need to start creating or crafting a win-win solution. And, you know, the better you get at getting motivated sellers what they want, the more often you're going to get what you want. So after they've told you what they want to have happen, so now you know what they want to have happen.

You don't need to have the solution yet, but now you know what they want to have happen. Your next question is going to be, if we were able to come to an agreement, how soon would you want to sell? If we were able to come to an agreement, how soon would you want to sell? That's the third question. And this question right here is going to separate the suspects from the prospects most of the time. You see, what's with this question is where you're listening for motivation.

It's where you're listening for urgency. We want to hear, I want to sell ASAP. I mean, we want to hear, I want to sell today. Those are the types of things you're listening for, even better. We want to hear, I want to sell yesterday. And if you hear any of those or anything of the sort, you may have a real prospect. Anything other than that likely a suspect. But anything similar to that that demonstrates urgency, you may have a real prospect.

But again, if you don't hear any urgency in their words or their voice, you want to be real cautious with regard to how much time you're going to spend with this person. and you can probe a little bit further if you want. I mean, you've got them on the phone. But remember, you're looking for sellers that need to sell. There's a lot of people out there that want to sell. There's a lot of people out there that will consider selling. But you don't want to deal with them. That's not who you're looking for.

You're a real estate investor, and real estate investors look for deals. And the deals come from people that need to sell. That's where your time is best spent, because that's where the deal. are. Those are your prospects. And when you find those, and only when you find those, do I recommend setting an appointment to meet the seller in person and visit the property? Only when you find those, do I recommend setting that appointment to actually go meet them in person and visit the property.

And here's why. You see, you'll get a very high number of suspects calling you from your marketing. And if you've done any marketing, you already know that. You've got a lot of people that have called you that weren't even remotely motivated. Suspects. So these three questions that I just gave you will do most of your sorting for you. Sorting the suspects from the prospects.

And that is your first goal when prospecting is to sort the suspects from the prospects. Leave the suspects alone. Don't waste your time. A lot of people, you get all your days worth of time sucked up by spending your time with them.

You've got stuff to do. Your time is better spent elsewhere. Now, your second goal when prospecting is to establish whether there is a real deal to be had or not. Okay, you've got a prospect. Now, is there a real deal here? Or not? Should I just move on or should I stick around? So how do you know which deals are real deals?

Well, here's how you know the deals from the real deals. And it's a simple three-step test. I like keep a simple. One, two, three, one, two, three. So first, is this what you're looking for? Is the property that this motivated seller has, this prospect has? Is it even what you're looking for? Does the property fit the criteria that you have set for yourself?

Meaning, does it produce cash or cash flow? Maybe you're an investor that needs cash and you want to go fix and flip or wholesale. Is this a good viable property for that? Or maybe you've got some cash and you're just starting to, you want to start converting it all into cash flow. Well, is this property a good can't? it for making cash flow, for creating cash flow for you. Is it in your defined area?

Is it the type of property you're looking for? Is it in the price range of which you're looking? Does it fit your criteria? And all of those things comprise your criteria. So that's first. Does the property fit your criteria? Second, is there motivation on the seller's part? Does the seller truly need to sell?

Does the seller truly need to sell? because it will be the seller's reason for selling with the perceived time crunch within which to do it. It'll be that reason more than any other factor that will help you get a real deal. So first does the property fit your criteria. Second, is there legitimate motivation there for that seller to sell? I mean, because this is going to be your mantra right here.

As this mantra can save you hours and hours of deliberating whether you have a deal or not. And your mantra is, the foundation of a real deal is the seller's motivation to sell. The foundation of a real deal is the seller's motivation to sell. Got it? The foundation. What is all built on, what a real deal is built on, it's built on the seller's motivation to sell. And your job is to always find out why a seller is selling.

And why is that important? Well, because the foundation of a real deal is the seller's motivation to sell, the reason why they are selling. And typically, you'll have to ask the seller many times before you get the real answer. There's lots of reasons for that. I mean, some are trying to keep up their negotiating face and they don't want to give their house away. Others might be embarrassed to reveal why, and others might just not feel comfortable with you yet. So you're going to have to ask several times before you get that real answer.

And, I mean, the answer you get the first time you ask why they're selling is typically just the tip of the iceberg. You know, 90% of that real reason lies hidden below the surface. But just keep asking. I mean, if it is a motivated seller to which you are speaking, you will eventually get your answer. All right. Now, third, it first was, is the property fit your criteria? Second, is there truly seller motivation there? And now third, and this is the final test of distinguishing a deal from a real deal, what are the price and terms?

Okay? Pretty basic. What are the price and terms? And to consistently get real deal after real deal and reach the goals that you have set for yourself, you must always be controlling one or the other. Got it? You must always be controlling either the price or be controlling the terms. Sometimes you'll get both, but not necessary. You only need the price or the terms.

And you'll buy property in only one of two ways. You either pay your price with their terms, or you pay their price with your terms. Can I say that right? You either pay your price with their terms, or you pay their price with your terms. And what that means is to make a profit on a deal, you need to either purchase the property for your price at a steep discount and their terms,

which is typically cash, that's what they want, or you'll pay their price, and it doesn't really matter what their price is, and I'll explain in great detail what I mean by that in the immediate coming episodes, but you'll pay their price with your flexible terms. And as long as you can control one, you've got a real deal if you get to, if you pass the first two phases. If it's the type of property you're looking for and there's seller motivation, as long as you can control price or terms, now you've got a real deal. And I'll repeat that because it's with this mindset that you'll reach your goals and create your fortune, where you'll create your financial freedom. You know, as long as you can control one,

the price or the terms, you've got a real deal. And very often, this will happen for you if the deal passes those first two tests. You're going to get the control of the one or the other. So one, is this what you're looking for? Two, is there seller motivation? And if you get a yes from those two questions, you will typically be able to get your price or your terms, which defines a real deal. So next episode, what we're going to do is we're going to go over property analysis.

And, you know, that might be sound boring to some of you and might sound really exciting to others. But I want to go over property analysis as this is a part of the business of which many investors are guilty. They're guilty of bad property analysis. And it's probably the biggest reason that investors lose money. They didn't analyze correctly. And I want to go over that.

And, you know, it's just really a big deal because, I mean, what if you do get control of the property and you get your price or your terms? And this is a real deal. And you just found out that this is going to go your way. You're going to get the price of the terms. Well, you better pick the right price. and conversely, if you get control over the terms in your real deal, you better pick the right terms.

And that's what good property analysis does for you. It reveals the right price, and it reveals the right terms. So we're going to cover all of that in the next episode. So until next time, as a very wise person once said, the art of effective listening is essential to clear communication, and clear communication is necessary to real estate success. And to your success, I'm Matt Terrio, living the dream. Thank you for spending this time with Matt Terrio and the epic real estate investing podcast.

When you have a moment, stop by iTunes to leave your comments and let us know what you think of the show. And if you haven't done so already, get started investing today by visiting free real estate investing course.com. To access Matt's free course, how to do deals, no money required. Until next time. To your success. To your success. This podcast is a part of the C-suite radio network. For more top business podcasts, visit c-sweetradio.com.