A question for some of you who have been doing this a long time:
I made a couple calls today and made some appointments for thsi weekend. What should I bring with me when I go? Specifically what paperwork in case the impossible happens and I actually get someone motivated enough to consider a crazy deal?
Also, how important is it to disclose you’re an investor before you meet with the HO? I’m following a script out of one of the Conti & Finkel books but forgot that part on a couple of the calls.
You should know whether or not they’re willing to consider a “crazy deal” before you run all over town looking at houses. But I guess since you’re new it doesn’t hurt to take a look at a few houses and chat it up with some unmotivated sellers. Just don’t allow yourself to be shocked and disappointed when you don’t get any deals.
As for contracts and such, it’s very rare for me to sign on the first visit, I prefer to play a little harder to get than that. But keep in mind that I do not do business with desperate sellers so there’s little risk of them running off and signing with the next guy.
What I do absolutely require is a firm verbal commitment to the terms before I leave. I’ve also begun using a “letter of understanding” which spells out the terms and conditions and the seller initials their agreement. This is not a legally binding contract, the purpose is to get an emotional commitment to the terms without forcing them to sign a big scary “contract” on the first date.
After giving them a couple of days coolling off period to talk to their lawyer or brother-in-law or whoever has the best chance of talking them out of the deal. I call them up and see if they’re ready to get everything in order. If they’re very positive, then signing the contract is a mere formality, instead of a complicated negotiation. If they have a lot of questions or seem hesitant then I play even harder to get, pretending that I also have concerns and need to think it over some more.
I rarely have this kind of problem after making the seller chase me but if it does get to this point then the deal is almost always dead, for the time being anyway. Am I bitter? Hell no! That’s the whole point of waiting, I WANT the sellers who aren’t totally sure to weed themselves out now, instead of becoming a pain in the butt later on. Because of this step-by-step progression I have almost no problems with seller-remorse.
It’s just a paragraph or two that basically states the price and payments, and has a place for the seller to initial. I try to make it look nice with good formatting, but it’s really pretty informal.
