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Adam King (MI)

Sellers Always Want Cash. What to do?

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Yeah Adam,

 

what was that secret tip? I almost forgot all about it... let the secret loose ;-)

 

Mike

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Hey all,

Believe it or not, we "did" go over it during the teleconference last night. It was about leverage. When we're broke, we don't think we have any leverage. When we have a million bucks, we realize that we have the leverage. That works wonders to our confidence when we realize that we're the buyer and not the seller. MC covered it in pretty good detail last night when he talked about perseverance.

 

As for getting all of the money in the world, that's simple too. Get the leverage that will make people want to give you money! Being savvy at the dream of REI works well to attract people that want to make money.

 

Example:

If you have studied MC's course and understand it well enough to do a deal (Which is very easy to do), then you take that knowledge and use it to get partners, buyers or associates to help with deals. It's kind of like doing a CA; it's considered an REI transaction, but where's the money? You have leveraged yourself to use the "seller's money" even knowing you may not see it that way. But it's the truth, they've used their leverage (Credit) to get a mortgage to buy a property and now you're using your knowledge to help with a situation to profit. Either way there's money involved.

 

Now, knowing that you can go out and change things around a little to put yourself into the buyer’s chair, it's time to take action. Take your leverage (Lease Options/CAs etc) and use it to "buy" properties yourself. It doesn't take long before you get a reputation and people want to use their credit/capital to work with you. Now here’s the catch. Once you have done this, you will have the ultimate leverage (courage) to hold them on your own. You’ll know that you understand that numbers and that if something goes wrong and you can’t afford to hold it, help is only a phone call away.

 

I can now take anyone with a 680 credit score and make them $5K to $10K within 45 days without them knowing ANYTHING about REI. All I do is offer a strategy and my knowledge. If they don’t trust or believe me, I show them the numbers and the contracts that bind me to my word.

 

So thing about all of this. If this stuff gets put into place, how long do you think it would take to get past the "cold calling fears"?

I would guess not long.

Regards,

Adam

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Sure;

 

You take the person with the great credit score and use their credit score to obtain mortgage money to purchase a property and sell it back to the buyer who can't otherwise qualify. No money has to come out of pocket for the investor because whatever cash is required comes from the prospective buyer.

 

Great return for the investor; great opportunity for the buyer, who will pay approx 15% above the purchase price from the seller, or whatever works. Cash up front to investor.

 

This helps with investors for whom credit is getting tight because they own more than ten properties, etc. Take in an investor who knows nothing and put his credit to work...for you, and him.

 

.....................

 

I know where to get investors money to purchase and sell back, when I get an option so I can then get a buyer.

 

My problem is getting the option in the first place. No doubt confidence will help,

but seller wants to know why option. Were I to use a straight sales contract, the seller would want not only earnest money, but also to know how I was going to buy. With no track record, it's more difficult.

 

I need to circumvent that. It will happen, but it is taking longer. In my case, it is also taking longer because FSBO here are approx 3 any given weekend, generally all of whom I have contacted. This means I must go out of town. No problem except transportation won't go that far right now, so it means doing it long distance.

 

No problem, but I think it would work better and faster if I could personally go to the seller's house to get contracts signed. I think being unable to do that, along with my newness, is simply making it take longer for me.

 

I've come close, but so far no pony.

 

Michael is right, and so are you. Attitude and confidence is crucial. However, so are motivated sellers: it is a numbers game. I think possibly if you have to call say 50 FSBO in area to get deals, then working out of area, you have to call more than 50. Possibly a lot more than 50.

 

So this doesn't mean it's impossible, just that it may take longer. Of course it can also happen sooner. I almost had one....3.5 hours away.... but finally his realtors got their rears in gear and actually brought buyers.... partly cause they knew about me.

 

So before I could use fax or email to get him to return signed docs, the place was sold. He had been the 3rd out of area person I called. So you never know.

 

 

Thanks for the help; it is invaluable to newbies.

 

I and the others did think perhaps you had something else; thus the questions.

 

Again: thanks for all help.

 

Alice

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Alice,

I started to answer your post and I am already at three pages. I agree, there is more to be revealed here and I plan on doing so. (This stuff is fun) Please give me some more time and I'll try to answer everything as thoroughly as possible.

I'll try to post by tomorrow evening at the latest. I have had to stop this post alone for the phone about three times...ugh.

Regards,

Adam

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I can now take anyone with a 680 credit score and make them $5K to $10K within 45 days without them knowing ANYTHING about REI. All I do is offer a strategy and my knowledge. If they don’t trust or believe me, I show them the numbers and the contracts that bind me to my word.

Adam,

Could you elucidate (Tony's trying to increase his vocab) please.

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Alice,

 

My problem is getting the option in the first place. No doubt confidence will help,

but seller wants to know why option. Were I to use a straight sales contract, the seller would want not only earnest money, but also to know how I was going to buy. With no track record, it's more difficult.

 

If I'm making a cash offer, I don't give an escrow unless it's going to break the deal. As for a pre-qual letter, they get my investor's. Getting an option is never a problem with a motivated seller.

 

I need to circumvent that. It will happen, but it is taking longer. In my case, it is also taking longer because FSBO here are approx 3 any given weekend, generally all of whom I have contacted. This means I must go out of town. No problem except transportation won't go that far right now, so it means doing it long distance.

 

You DO NOT need to go out of town to do deals. If there's only 3 FSBOs around, you need to market for those deals that you don’t see. After doing this for the time I have, I can see a deal within every 5 to 10 houses down my own block. You'll see problems with sellers before they can see them themselves! And think about this too; Doug and I had not used a pre-qual letter, answered any "what's your experience" questions or used ANY money (Okay, Doug used .93 cents for the signs) to get an accepted offer on that house in Ontario. Although we may not get it because of a greedy ex-wife, that's not the point. The point is it can always be done with NO money and little effort ANY WHERE.

 

No problem, but I think it would work better and faster if I could personally go to the seller's house to get contracts signed. I think being unable to do that, along with my newness, is simply making it take longer for me.

 

If a seller or new contact is too far from me, I have them meet me half way or have someone sign on my behalf. Big Boys is one of my offices. But I agree that getting in front of the seller is the best way to close a deal. (PS, Doug doesn't have a car and I never made a trip to Ontario. Just something to think about)

 

it is a numbers game. I think possibly if you have to call say 50 FSBO in area to get deals, then working out of area, you have to call more than 50. Possibly a lot more than 50.

 

I used to think this was a numbers game too, but I don't anymore. Of course you need motivated sellers, but not all of the time. There's just been too many deals where logic has overcome motivation. It's just how you present your self/product and who you talk to. You don't have to always wait for someone to call you crying, but again (As Barry said), it's a TON easier when they do call you first.

 

So this doesn't mean it's impossible, just that it may take longer. Of course it can also happen sooner. I almost had one....3.5 hours away.... but finally his realtors got their rears in gear and actually brought buyers.... partly cause they knew about me.

 

Again, motivation and perseverance sells another property. When I work REAL hard to move a property, it moves. Just ask yourself if people in your town are doing deals. If there's no one doing deals, then it usually means one of two things. One, you have a golden opportunity or two, you live in a shoebox and you may need to go to where the buyers are.

 

Thanks for the help; it is invaluable to newbies.

 

Hey, how do you think I learn? Ever watch someone hammering a nail and hit themselves on the thumb? What did you do after seeing that? Of course, I usually repeat the mistake, but we do learn from it....eventually.

 

I and the others did think perhaps you had something else; thus the questions.

 

There is more because I was talking about getting the money/leverage, and here it is:

 

Make what's against you for you

 

You start out with no money, no knowledge and no experience. This doesn't help cold calls (Which are the cheapest and fastest way to get a deal). But it's like me telling you that I have invented a new proton fusion protein weight loss shake maker and I want you to cold call people and sell it. Now, you say that would be a complete waste of time, but after further telling you that the shakes it makes are "carb free", you say...hum, this just may appeal to some people. Then I tell you I will pay you a minimum of $3,000.00 for every sale, now you’re in right? You can actually “feel” the money between your fingers already. You can see your new house you can see how easy it actually would be to do at least ONE sale a day. Yeah, that’s it one sale a day is over 1 MILLION a year! You’re motivated and ready to go because of all of those “ME BEING RICH” thoughts.

You then call people and start selling.

 

Hi Mr/Mrs buyer, I was wondering if you're fat and need to be skinny because I have the ULTIMATE COOL PRODUCT?

Click.....phone hangs up.

Oh, they just had an attitude; I'll try again because I NEED the money.

Hi, I was just calling because…Click,

Hi, I was just… Click,

Hi….Click,

I can’t do this, it’s an impossible sale because no one wants to lose weight. Well, that’s the real world, but we still know there’s some kind of angle.

 

Real Estate Example:

Call:

Hi, I have this great idea on how to help people (And make a fortune for myself) and I’m wondering if you are…….uh, I think…we, they….er….

Click.

 

Okay, we ALL know how that one goes. So change the leverage. Several of us have already answered the question about how to get all of the money you need. You simply leverage your knowledge and services for partnerships/help/credit from others. I could easily just call a few people on this board to have all of the money in the world.

 

1. Someone for (Knowledge)

2. Someone for (Money) Broker etc

3. Someone for legal (Attorney)

4. Someone for (Marketing)

 

I could name names here, but I don’t think I need to.

 

 

So with all of that, my point isn’t that you have to have all of the money in the world, but it helps build great confidence that you’re really running a professional and realistic business. There’s just something in our logic that tells us that even knowing we can read a course and “get it”, we sometimes still feel like a fraud when it comes time to get in front of a seller.

 

What I have been doing of late:

This post is trailing, but I thought it would be worth it to show an angle.

 

I take people with 680 or higher credit scores (Or a little cash), partner with them, make offers on properties (Cash, SLO, Sub to etc) and either flip them properties or hold them as partners. I use one investor per deal so there’s no security issues. What did I offer to do this? The knowledge of how to make the American Dream a reality, and that was learned from boards and posts just like this.

 

Hope that makes sense. I could get into a whole essay about my business, but I don’t think that everyone would gain from it. (Not to mention I'm a little partial to sharing the whole shabang) I think that all learn the most from each other, even if we’re brand new. We’re all intelligent to some extent.

Regards,

Adam

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You DO NOT need to go out of town to do deals. If there's only 3 FSBOs around, you need to market for those deals that you don’t see. After doing this for the time I have, I can see a deal within every 5 to 10 houses down my own block. You'll see problems with sellers before they can see them themselves! And think about this too; Doug and I had not used a pre-qual letter, answered any "what's your experience" questions or used ANY money (Okay, Doug used .93 cents for the signs) to get an accepted offer on that house in Ontario. Although we may not get it because of a greedy ex-wife, that's not the point. The point is it can always be done with NO money and little effort ANY WHERE

 

Thanks, Adam! :D

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Alice,

 

Have you tried going around some of the neighborhoods and just looking for FSBO signs. I'm amazed at the number here who'll try the FSBO route and the ONLY thing they'll do is stick a crummy sign in their yard.

 

Kim

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You guys/gals are VERY welcome. Posts like these give me the opportunity to see where I'm at and what I'm doing. I can also see because of the post that there are some things I need to simplify. So thank you too! ;)

Regards,

Adam

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