How to Approach and Deal with Buyers

By: Cris Chico
Working with buyers can be the most difficult part of the wholesaling industry. While sellers are usually friendly because they are desperate to move their property, buyers can be sleazy, inconsiderate, forceful and bossy. Buyers can also be quiet, shy, and difficult.

However, like you, property dealing is how they make their profits as well. No matter how hard they try to make you believe that they are doing you a favor by listening to you and purchasing property, if it were not for wholesalers like you, there is a good chance these investors would have a hard time finding good deals on properties, and their own profit would also suffer.

There are four times you have to deal with buyers:

• Before you even have a property and you are looking to add them to your buyers list.
• When you have a property and want to gauge their interest and convince them to visit the site.
• When you have multiple buyers and you are applying leverage.
• After you have decided on a buyer and it is time to close out the deal.

Every different type of contact with your buyer brings different potential conflicts and utilizes a different type of social approach in order to try to sway the buyer into the next step in the process.

Sometimes you need to change the way you speak to buyers depending on their personality types, and to do that you will have to use your own experience dealing with similar individuals in other settings. However, there are a number of tricks that you can use to deal with buyers in almost any situation that work with almost all buyers, and if you use them correctly, you should be able to move them further along in the wholesaling process.

Step 1: Contacting Buyers for the First Time

Buyers lists do not create themselves. Every single person on your list is someone that you have spoken with about their property interests, their financing, their areas of preference and everything else you need to know in order to offer them properties that would be of interest to them.

Each of these people you are likely to talk with on the phone, and each of these people you need to convince to provide you with their contact and purchasing information. This involves a great deal of your own wit and social skills as you emotionally maneuver your way into their lives.

There are going to be three types of buyers that you are going to contact:

• Those that are part of some sort of group (Real estate groups, etc.).
• Those that you find online, in newspapers and many of the methods that involve paying attention subtle clues you learn throughout your career as a wholesaler.
• Those that you meet in person at social events.

The latter of those three (those that you meet in social events) should not require anything beyond the way you deal with anyone that you have just met. These are people that you are introduced to at a social gathering or simply meet in the local coffee shop, and you should introduce yourself to them just as you would introduce yourself to anyone new.
The other two are often approached differently, however.

When you are provided with contact information for people in something public, like a real estate group, you can provide them with a hard sell. Show them what you will have to offer them, explain to them the benefits of working with you, display your understanding of the field and so on. Depending on how easily you got the contact information for this real estate group there is a good chance that they have been contacted multiple times by multiple wholesalers. They probably are used to people calling them and offering them properties, so you need to make sure that they know that you are going to give them the best deals and you are going to show them you know what you are doing.

Contacting these “hidden buyers” requires a different strategy. These are people that you find in areas where they are not advertising themselves – like going through classified ads, noticing that property sellers are using lingo that only buyers tend to use and giving them a call.

These people are currently hoping to sell their property and they expect people calling them to be interested homeowners. You need to earn their respect by being cordial, explaining why you called them and not overselling yourself so that you scare them away. These people you need to approach like regular people – like someone with a free room in their apartment, and you are interested in living with this person you have never met.

Both of these rules are not set in stone. You may be cordial to someone only to find that they are losing interest and you need to hard sell yourself, or you may come across someone that is not interested in sales speech and slow down.

Either way, you need to win every buyer over you can, because the more investors you have, the easier it will be to sell your properties.

Step 2: You Have the Property

Now you have a piece of property in hand and it is time to contact some of your buyers. Here, the main goal is to try to get the buyers interested in the property – preferably enough to visit the property and come back with a number they want to pay.

There are multiple ways to go about doing this:

Pictures

Pictures are a great way to peak someone’s interest in the property. For a small fee, you can get someone from craigslist or a company that takes property photographs and use those photographs to tempt your buyers into visiting the property.

You do not want to give too many photographs because you want them to visit the property – not the least of which because you do not want to have a deal in the works, have the buyer visit the property without your knowledge and realized you tricked them into buying a worse property by using better photographs. You want to make sure they have seen the property, know its value, and are willing to make a deal on it. Pictures are another way to do that.

Being Humble

Another way to get them to visit the property is to humble yourself and defer to their expertise. Almost all buyers like to have their egos rubbed, and by saying something along the lines of:

“Hi Bob Clinton, this is Bill Dole. I have a property in your area I think you’d be interested in. I was thinking it was worth about $45,000 dollars, but I really do not know how to evaluate it properly. Would you like to see the property and help me figure out what it is worth?”

Statements like that sound as though you do not what you are doing and that you require their expertise in the subject in order to value the house properly. This accomplishes two things:

1) You have found a way to get them to visit the house

2) They know your asking price

Both of those are very important in the wholesaling business, and the fact that you can get them to visit the property with a price tag in mind and high esteem of themselves is a strength in its own right.

Telling them About the Property

Of course the final way to get them to visit the property is to tell them about it. Make sure you know as much as you can about the property, including what you assume the estimated repairs to be, the estimated value of the property if they fix it up and resell it, and why they would be interested in the property.

You do not always need to be finding clever ways to get someone to visit a property – a good buyer is going to be interested in the next big score, and if you can explain the property to them and why they should be interested in it, there is a good chance that they will want to see the property for themselves to see if they are interested in it.

Step 3: Applying Leverage

Another time you have to deal with buyers is when you have multiple buyers interested in the property and it is time to apply leverage.

When you are dealing with leverage with buyers, you want to approach it both delicately but with a sense of urgency. Tell the buyers that yu have multiple buyers, but you will give it to them for a non-refundable deposit of 10,000 dollars. Or tell them that for only 3,000 dollars more, the property is there’s.

You should, however, make sure that you respect your buyers and do not make them believe you are lying and simply trying to swindle them. Anything you request should come with a validation. Therefore, do not simply say:

“Hey, I have another guy interested but if you are willing to pay me 5,000 more I’ll give it to you instead.”

Rather, you should present it in a similar way to:

“Hi John. I have multiple buyers interested in this particular property. As we discussed, the value of the property once it is fixed up will net you a profit of $35,000. If you are willing to add an additional $3,000 down for the property, you will still profit by $32,000 dollars and the property will be yours.”

In addition, this is not a time to go to another buyer and see if they will offer you any more than that. You are only as good as your word, and if a buyer agrees to give you an additional 3,000 dollars or additional money for the deposit, you need to make the deal with that buyer so you can be considered a trustworthy name in the wholesaling industry. Decide how much you want to make with your leverage and stick with it.

Step 4: Closing the Deal

Closing the deal with a buyer is, at this point, a much more formal process and usually involves slightly less savvy. You want to make sure that you have the buyer signing the paperwork at least 3 or 4 days before the contract with the seller expires just in case something goes wrong.

You also want to have a discussion with the buyer about financing.

They need to be able to pay with:

• Cash
• Cash in a Retirement Account
• Partners
• Bank Lines of Credit

Or some other form of liquid, assured payment – especially in today’s economy, where banks are rarely providing investors with the financing they need. Standard loans also take much longer to process, and you do not want to run the risk that everything is in place, only to find that the buyer’s loan was declined.

Do not give the buyer too much time to get the financing together, either. No one likes to feel rushed, but the more time that anyone has to think about where they are putting their money, the longer they have to talk themselves out of the deal. Once it looks as though the deal is in place, give them a deadline to fund the deposit and try to put it not too far out in the future so that you do not give them time to change their mind.

Final Thoughts on Buyers

While all of the information in this report may help you when it comes to dealing with buyers, there are several things to remember:

1) Buyers are people
2) People have their own personalities
3) No amount of instruction when it comes to speaking to buyers should be seen as the final say in how to deal with these individual personalities. Rather, they should supplement your understanding of people with extra information on how to deal with the buyer’s personalities.

Sometimes you have to soothe an ego or two, other times you need to act as though your ego is the size of the property you are selling. Real estate is a cutthroat and fast paced business – the ability to adapt to your surroundings (which, when it comes to dealing with investors, means finding a way to get them to be interested in what you are saying) is one of the primary keys to success in the wholesaling world.

The final thing to remember is that they are benefiting from your conversation too. If you feel yourself struggling to make a good impression, just remember that if you have a good deal for them, they want to hear about it, because they are also profiting off the transaction. They may act like they are doing you a favor talking to you, but in reality you are doing a favor to them, because without you they may not hear about properties that can net them substantial profits. You don’t have to call them when a new property is in play, and if they are not willing to be a part of your wholesaling business, you don’t have to. Let someone else profit off their mistake.

As the creator of Virtual Wholesaling, Cris Chico is helping investors realize their dreams of financial freedom through his proven & guaranteed method of finding & flipping properties in hot markets (whether you live there or not). To find FREE information about how YOU can “Invest Everywhere from Anywhere”, visit www.VirtualWholesaling.com today!