Keeping Up With Your Deal
Picture this familiar story: You go to a real estate meeting and meet a Buyer looking for property. Ecstatically, you immediately add them to your Buyers list which they fully expect. Within the next week or two, you get a deal and send it to them via your Buyers list. A day later or perhaps only a few hours, you get a phone call from the Buyer (let’s call them Bob) and it goes something like this:
You: Good afternoon Bob, how are you?
Bob: Doing well, yourself?
You: Doing well. How can I help you?
Bob: Well I got this deal here at 123 Main St that you sent me however I have gotten it from five other people and am trying to figure out who has it since they all have different prices. I am very interested but need to know who really has the contract so I am not wasting my time. Another gentleman called me and said he was under contract but it seemed odd since your price was lower yet he was animate. You seemed like a nice fellow and your price is the lowest so I am starting with you. Is this your deal?
You (trying not to be frustrated): Yes sir I do. I am sorry you have seen this from others at varying prices as chances are they are other wholesalers on my list that I don’t really know. I can meet with you in person and show you the contract I have to purchase in person or you can contact my attorney who will verify that he received a contract from me and has ordered title. Would either of these work for you?
Bob: Well that sounds good. I just get tired of seeing the same deal cross my desk with a wide range of prices from different people. I am good with speaking with your attorney, do you have the number to their office?
You: Sure thing, here it is…
At this point, you breathe a sigh of relief. You felt good about this Buyer as he seemed credible and the last thing you want is for your first deal with them to be derailed because of other people with ‘contracts’ on a property. Why does this happen anyway? Why is it when you put a property out to your list for $50,000 that people just don’t honor the price and talk with you about it to avoid confusion? Why do others say they have a property under contract when they don’t?
The answer is simple…as wholesalers, we don’t ask them to. Also sometimes integrity issues come into play. Today, let’s focus on the first part. If you do not ask, you do not receive. It sounds overly simplistic but is true. If you ask the people on your Buyers list to respect your pricing, usually they will.
Wholesalers come in a variety of education levels. Sadly the vast majority get very excited yet drop away quickly from the field. However they can create a lot of noise quickly and oftentimes not for the positive. Buyers pick up on this and there are plenty of Buyers who do not hold wholesalers in high regard. How do you minimize the impact this has on your business? After all, co-wholesaling is supposed to be ok right?
Well it is ok, as long as you do it right. Having done several successful co-wholesale deals, here are keys to your success:
- When sending out a property, ask ‘if you are a bird dog or wholesaler, please consult with me FIRST before sending to your Buyers’ – many of them will and this alone will get a lot of people to not send out nonsense markups to their lists.
- Make sure any website you put the property on also has this verbiage. Having a policy on how to work with other wholesalers and bird dogs on your site can be helpful as well.
- If you are calling other wholesalers, ask them to only send the deal to their qualified Buyers. If they are actively doing the business, they oftentimes know exactly who these people are on their lists already.
- If the deal needs to be marked up for someone else to make money, ask for it to be limited to 1-2k. Most Buyers can work with minimal markups if they understand more than one person is involved AND they are working direct with the person with the original contract to purchase.
- If the wholesaler has a Buyer and they think they can make more money on the deal than a minimal markup, have them present it to their Buyer directly and not via e-mail blast.
- Always disclose the full scoop to your Buyers. They will respect you accordingly. Solid Buyers understand wholesalers need to get paid for their efforts as well.
I can tell you nothing is more frustrating than having a wholesaler send me my deal back to me at 20k higher and swearing they have it under contract with the Seller. Needless to say, this is not how to do business.
So when you have a deal to share with the world, ask people to respect your wishes. Be clear and concise. Most people want to do business with people they know, like and trust and if they are sincere, they will listen. Be consistent in your message you share yet encourage others that opportunity is there to share if it makes sense.
And if someone does not oblige, it is ok to pick up the phone and call them. Sometimes, wholesalers are simply not educated enough to know the rules of the game and a little guidance solves the issue. However if they do not want to play ball, it is acceptable to remove them from your list immediately.
Ultimately, presenting your deal in the best light possible is key to closing deals successfully. Represent yourself well to Buyers and other Wholesalers and Bird Dogs with clarity and your issues of the too often stated story above gradually go away. Ask and you shall receive indeed.