How do I respond?
Homeowner calls....blah blah...
Me: ...I help people in situations such as yours (preforeclosure) and of course, I do it for a small profit...
Homeowner: How much profit will you make from my home?
Me: Well, each situation is different, Mrs. Homeowner, what would you like to see happening with your situation...?
Homeowner: How much profit do you ussually make from buying houses?
Um...what do I do when the homeowner will not ease up with the profit fixation? 
Mr. Home owner there is know way I can calculate profit margins on a property I have no information on and haven’t seen. (I’d go hard) I don’t discuss my personal or corporate bank account information without my financial advisors present. Now mr. Homeowner do are serious about selling you home because I have other people in need of my assistance that I need to speak with. (if he is a real ahole) Sorry I just received another important call from one of my buyers on another line do you mind if I give you a call back.
Future-Multi-millionare, that's a nice way of working your way out of the situation. Impressive...
Personally, I don't think you should have to mention anything about you making a profit from purchasing their home. You tell them that you are helping them out of their situation by purchasing their home to get it off of their hands. It is causing a financial burden to them. Do they really want to be forced out of their home after it goes to auction?
Tanya
You tell them that you are helping them out of their situation by purchasing their home to get it off of their hands.
--Tanya--
That is definitely the attitude to have!
Thanks for the replies Future-Multi-millionare and Tanya.
After so much studying, I am finally placing "my feet in the water." I can say, that the hardest part for me so far as an REI is keeping my motivation high...it's a tough market in California!
anyways, thanks again~
Vis
Hi Visualized,
Seems it is just a question of semantics really…the wording. How would you like it if someone told you that they were going to help you, for a small profit of course? Nobody likes to be profited from. Are you a profiteer? Profit might as well be a four-letter word when it is to be “taken” from a prospect. I inadvertently said the same thing once. Never again.
How about: “I make my living buying and selling houses, and helping people who may need to sell their home due to foreclosure, a death in the family, or other difficult situations.”
If asked how much will I make from their house, I will likely say: “I really can’t tell until we figure out what you need and what we can do for you.”
If further pressured: “I won’t pursue a deal unless I can see $5000 or more for doing it. Does that seem fair to you?”
Finally, there comes a point when no deal is worth doing business with a prospect who is difficult and belligerent. If they are more worried about your margin than they are about their situation, it’s likely time for you to move on…
Hope you find this useful.
Regards,
wgheisler
Not copywritten
How to Avoid The Five Most Common Mistakes Investors
Make When Negotiating!
By David Finkel
==================================================
1. Negotiating Over the Telephone:
Why is it that so many investors think that they can
effectively negotiate the deal over the phone? Yes
negotiating over the phone saves you time, but it also
is extremely difficult.
You will ALWAYS be more effective in person as compared
to negotiating via the phone. In person you'll have
the non-verbal cues to watch for in their body language.
In person the other party can really get a sense that
you are a good person and come to like you more. And
in person you can more easily connect with the other
party, something we'll talk more about in a moment.
How is it that investors get TRICKED into negotiating
over the phone? Sellers will say things like, "Tell me
about your program?" or "What will you give me for the
property?" Be WARY before you answer. If you are not
careful, you will get yourself into the heart of the
negotiation prematurely.
Instead, answer these questions cautiously. Say,
"Well Mr. Seller, to be frank I'm not sure if I do
want to buy this property. With all that's going on
in the world I'm not sure that now is even a good time
to buy. May I ask you a few questions to see if this
is even a house I would want to have you show me through
the inside of?" Notice how you have effectively turned
things around on the other party.
2. Negotiating Money Before Motivation:
The single most important key to closing the deal is to
remember to never talk through any numbers or specifics
of price and terms before you have spent time talking
through the seller's motivation to sell the property.
In order to get a great deal on a property you need the
seller to feel motivated. We use the word feel
intentionally. It's one thing if the seller intellectually
knows he is motivated. It is quite another thing for him
to feel it in his gut. One is an intellectual response,
the other an emotional response. When you can help the
seller cut through the layers of denial and get to the
emotional core of why this property you are talking with
them about buying is such a burden to them, then you will
get a great buy.
The more time you spend letting the seller tell you all
the reasons he or she has had trouble selling, the better
deal you will get. Remember that the next time you are
tempted to rush past this step. The amount of money you
make in the deal is directly proportional to the time you
spent building the seller's motivation.
3. Talking In Technical Language Versus Descriptive
Language:
Can you imagine the seller's response if you were to say to
them, "Mr. Seller, what if we were to lease option your house
with an option price of $150,000. We would give you $1 as
option consideration, in addition to our commitment to the
long term lease which will be additional option consideration.
The term of the lease will be one year with five additional one
year renewals to come up on a rolling basis every twelve months"
Have your eyes glazed over yet? Are you a little intimidated
by the language? If you feel that way imagine how the seller
will feel. Scared and confused.
And a scared and confused seller is NOT going to ask you
questions to clarify their understanding or to settle their
anxiety. They are simply going to say one word…NO! So make
sure you instead talk in descriptive language like, "Mr. Seller,
what if we were to make you a guaranteed monthly payment every
month and then at some point down the road we were to cash you
out of the property at the full $150,000 price we talked through
a moment ago. Is that something we should talk about, or probably
not?"
The funny thing is that what you said in the second example
describes in functional terms what you said in technical jargon
in the first example. Remember, sellers want to feel
comfortable with whatever you offer them. You have got to
explain things to them in language that is simple and tells
them exactly what they get. Never use jargon or fancy language
to cloud up the discussion. It usually only serves to bolster
some investors fragile ego at the expense of his bank account.
4. Selling the Other Party On the Deal:
One of the subtle negotiation applications of this take away
approach is for you to become an expert at being a reluctant
buyer.
The single biggest language pattern of the reluctant buyer is
how they qualify everything they say with phrases: "I don't
know if I could do this, but what if" and "My partner might
not like this, but what if I could get her to agree"
Also, when you get the other party to give their initial
agreement on a specific idea or offer, fight the urge to
rush in and SELL them on the benefits that acrue to them if
only they move forward with the deal. Instead, get them to
sell themselves! You do this by asking them a question.
For example, if they said they would be interested in a
five year lease option ask them, "What about me making you
payments for up to five years and then cashing you out is
such a fit for you?" The result will be them telling you
all their reasons for wanting to do the deal.
5. Negotiating On an Intellectual Level:
Don't make the mistake that average investors do of talking
only in intellectual terms, work to get the conversation to
touch the other party at an emotional level.
The single most important skill you have as an investor is
your ability to connect emotionally with people. This is
the skill that will help you get the seller to open up as
to their real reasons for selling. This is the ability
which will help you create trust and rapport with the seller.
Master this skill and you'll never really be "negotiating a
deal." Rather, you'll be talking over ways of coming up
with a win-win solution with the seller.
So there you have the five most common mistakes that investors
make when negotiating deals. Use this information to keep
yourself out of trouble. We wish you the best of luck with
your investing.
Peter Conti
FMM, that was a great post I dont know about any one else but that helps me a lot with what to say and do in a tricky situation, thanx.
I wish I could take credit for that but I didn't write it David Finkle and Peter Conti were the authors.