Buyer Wants To Know Down Payment; Home Price

[Lexie(UT) 0]

When I am talking to people who have called on my ad, some of the first few questions they want to know is how much they will need for a down payment. They also want to know how much is the price of the home.

 

I understand from MC's course that you should not give them exact numbers, that instead you should ask them. So I usually ask them how much they have available and they answer back with a respons like well how much will we need. I can get whatever I need. I used to tell them we take 3% of the value of the home for our downpayment, which would then bring up the question well how much is the home?

 

What do I do to avoid getting asked these questions and if they are asked how do I not give exact numbers?

 

Lexie(UT)

[Kimberly 0]

Don't tell them a percentage, give them a number if you have to. When you say "3%," that's why they ask how much.

 

Follow Michael's script in the manual. If you follow it, you'll have better luck with the tenant/buyers, because you are staying in control of the conversation. Don't ad lib what you're going to say to them!

[MichaelC 160]

Lexie, I'll repeat here what you already know: he who speaks first, loses. And it seems like these prospective tenant/buyers you have been speaking to know this, as well.

This is not an unusual occurence, by the way. When it happens again, I suggest you follow the path as outlined in the manual.

After a few generalities about how a Rent to Own is advantageous for the t/b, and some generalities about the house, you will inevitably hear this:

 

T/B: This sounds just like what my wife and I have been looking for. So, tell me, how much down do you want down?

You: You know, Horatio, I haven't really thought about that. I guess my bigger concern is the quality of the people moving in here, and their intentions. I mean, we're setting this up as a Rent to Own because we really want to get it sold. I'm more concerned with the payments being made on time and the care of the property. But, now that you mention it, let's talk about it. You and your wife are out house hunting. I'm sure that prior to doing this you two sat down and discussed your budget. How much you can afford monthly, and how much you can comfortably put down today should you find the house and the deal you are looking for. So, tell me Horace baby, how much option money were you looking to put down when you found your dream house?

 

Now, shut up and listen. Only a few possibilities are likely. The t/b will blurt out an amount. This amount could be in the range you were anticipating. Good for you. Some background checks and you may have a deal.

The t/b may surprise you with an amount somewhat or considerably more than you were expecting. Again, good for you! Only don't show your glee! Reply with something like, "Yeah, that might work. As I said, I'm pretty easy about this. If all else checks out and you folks are serious, let's get this Lease Application completed and I think I can make this work."

Or, the t/b may try and low ball you and offer a heck of a lot less than you want. In which case you politely reject the offer, explain that you have already turned down an offer for more, and tell him that if he is serious he needs to reconsider. At this point, you may want to quote your own amount, higher than you actually need to be happy. This may get him higher, and a happy meeting somewhere in the middle.

Finally, if the prospect flat out refuses to quote a figure, you can do one of two things. Quote a figure higher than you are really looking for so you can get some kind of response. Or, tell him to give the deal some thought and get back to you when he has figured out his budget. This will weed out the serious from the curious. At least that's the method to my madness....

[Adam King (MI) 1]

Lexie,

Simply stay in control of your conversations. When someone asks you how much is the down payment, you ask them how much they have to work with. When they say; how much do I need? They're trying to recover control of the conversation.

Act as if you have a lot of different houses available and you're trying to screen them for the best one.

Talking to unqualified buyers is HUGE time killer in this business. Just try to stay in control of how your time is used most effectively.

Hope that helps,

Adam

[-Tony- 0]

I have used,

could you hold please I have another call coming in flash to the other line .......hmm.....hmmm...hmmm...in a minute or so go back and say. "Not that our conversation isn't important but I have an urgent call on the other line." "If you could figure out your budget and give me a call with how much you can put down, I will put you on the list." Yes, I have recieved many calls and there is a list. So, get back to me as soon as possible because I will need to move this house fast.

 

Thanks for calling....click

[Sold ! 0]

SCENARIO: I want $6000.00 on a $200k house......

 

TB: How much do you need?

 

YOU: How much were you considering putting toward the home you'll eventually own, Joe?

 

I can come up with $1500.00.J

 

Joe, if you were to buy this $200K house out-right from a bank, not only would you have to quzlify for the loan, but you'd need at least $20K as a down payment. I am eliminating the bank from the equation and getting you in way below $20K. We are going to need at least $8000.00 to do this deal. can you come up with $8000.00, Joe.

 

No.

 

Alright, Joe, how much can you seriously put towards the home you are going to own someday?

 

I might be able to find $3000.00.

 

Joe, I can do this for you. Get me $4000.00 cash and I'll take back an interest free note for the balance. can we make that work?

 

I might be able to find $4000.00.

 

GREAT. How much can you afford monthly to pay off the other 4 grand, Joe?

 

How about 50 bucks?

 

Joe, we need to get serious here....can you do $400 a month to get you into this house?

 

No way.

 

How about $200.00?

 

Maybe.

 

Joe, Here's what I'll do.......you get me $4000.00 to do the deal and I'll carry a $200.00 per month note for 12 months and we'll call it even......you are in for just over 3% and making progress towards eventually owning your own home, as opposed to renting for the rest of your life. Deal?

 

Deal.

 

 

 

END: Got $6400.00 and only really wanted $6000.00.