In your real estate business plan, you hopefully have a plan for a real estate presentation of some kind.
If you have been in the business a while, you will see that there are no sources available today for Investors or Realtors® of actually what to say to a motivated Seller without sounding like an idiot!
If you are a Realtor®, you probably have been taught some form of listing presentation.
But if you are a Wholesaling Investor or Realtor®, then there are no resources available of actually how to structure this most important part of the sales process.
In fact, I would say that the Presentation is THE hands down most important portion of the wholesale transaction.
It is at this point that the homeowner begins to get a very clear picture of what is going to occur. It is critically important that you accurately convey what will occur to protect yourself, all parties to the transaction, as well as prevent any miscommunication.
The Presentation Is The “Golden Key”
Your success in presentations to a Seller is dependent upon three critical factors.
- Your skill at managing their expectations of “The Process.”
- Your skill at explaining “The Process” itself.
- Your skill at demonstrating confidence in “The Process.”
Now, certainly at this point you might be wondering just what in the world I mean by “The Process”? That is a fair question. The Process, is whatever your State uses to transfer property. So by “The Process” I need to be able to (in my case) be able to explain how the sale will work in the State of Arizona, through title companies, escrow, etc.
In your State, the better you know “The Process” the more confidently you can present. On average, the current homeowner is 54 years old, and has lived in their house for approximately 11 years.(Source: Realtor.com) If that is the case, then it is highly unlikely that they will have a current working knowledge of the process.
If you are a new agent or investor, then this is critically good information for you! This means that on average the homeowner themselves is no more educated about the market than you are. In fact, they are most likely LESS educated about it because they have not dealt with it in quite some time.
First Task. Get to Know “The Process” in your State.
Now that you know how the process works in your State, the next key is to be able to convey it in a meaningful, yet concise way. Remember! People can only absorb so much information. In a difficult decision, or a high stress situation, the ability to retain information is degraded.
When a Seller is preparing to sell their home, it is not uncommon for a homeowner to get several opinions. Because of the stress of the situation, many times they are unable to remember what you said to them. This can be evidenced by their inability to remember the critical factors of a contract; issues of price, terms, closing costs, or even a refrigerator left at the house or not.
With this in mind, it is critical for the practitioner to make their presentation in as short a time as possible. The ideal presentation is less than 20 minutes. More than 20 minutes, you are beginning to “tell, not sell.” Less than 20 minutes allows you to answer any questions that a motivated Seller may have.
So how does one accurately convey everything that a Wholesaler would need to convey in 20 minutes? More importantly, what would need to be conveyed? In my opinion, for the Investing Realtor® or Wholesaler, the following would need to be completed an under 30 minutes.
- Introductions and Property Inspection.
- Understanding Seller Concerns.
- Sharing comparable Sales
- A “Question Based” Presentation.
- Time to answer any questions. (Objection Handling)
That is a lot to do. Any more than a 30 minute timeframe, and you are now beginning to lose. After 30 minutes, you will begin to make concessions just “to get the contract signed”, which is a very bad place to be!
In order to get all of these 6 items completed in a timely manner, one must work from a very well defined plan. Believe it or not, it is entirely possible to get a wholesale or listing contract completely signed within 5 minutes of walking in the door. In order to do it however, one must have a plan!
Second Task. Plan Your Attack!
Before you can make a realistic listing presentation or wholesale presentation, you must know what the problem is first. Agreed? That means that we must first ask the Seller the tough questions to determine if they are a real prospect for our business or not.
Pre-Qualifying the Seller Prospect with Scripts will allow you to know if you have a real lead or a prospect. Unfortunately, knowing the difference between a lead and a prospect sometimes is a “touchy feely” thing. You just hear it in what they say, or how they say something. I say unfortunately because many times, the only way to learn is by doing it!
Through repetitive contact to owners (that’s one of the reasons why you should call FSBO’s) you will get better at sensing if someone is qualified.
Some helpful questions to ask a potential lead to determine their level of motivation are below.
- “What happens if it Doesn’t Sell?”
- “Which is more important, you selling your home, or getting your price?”
Questions like these will help tell you if you are presenting to a qualified Seller. Make a pledge today to never present again to a non-qualified customer. You are only wasting your time and ruining your mindset!
Know your potential customer! Know exactly what they are planning to the best of your ability prior to your arrival for an actual presentation. Use the scripts we have to qualify them.
After you have priced the property and have determined that you indeed have a viable lead. It is now time to execute your plan!
Third Task. The Pawnshop Presentation
The next challenge for the practitioner, is exactly HOW to convey your (typically) lower than normal offer. I mean, lets just all be adults for a minute. Many people do not like Realtors®, many don’t trust Investors. Yet this situation requires the special skills of an all cash investor.
So, the first challenge is that if you are a Realtor®, people automatically assume you are working either FOR them, OR the buyer. Typically however, not yourself.
If you are an Investor, your problem is not so much of image. They already expect a lower than average offer from you. Your problem as a wholesaler is that you many times mis-communicate what you are doing with the property.
This is why you will many times have problems with Realtors® who are unfamiliar with Wholesaling. Typically, when you explain things to a Seller, or a Realtor® you will use language like “finding a buyer for you”, or “tying a property up”.
There are additional benefits as well. By using The Pawnshop Presentation, you are able to avoid the entire discussion of price, as well as what “other homes have sold for”.
Nobody gets angry at a Pawnshop during times of economic distress. Nobody vandalizes a Pawnshop sign. Why? Because although you may not necessarily agree or need a Pawnshop in your life, you certainly agree that they have a place in our society.
People instantly recognize that in a “Pawnshop Environment”, an items value is not based on sentiment. (For the “I want to get X price because that’s what I think its worth.” customer. )
In a “Pawnshop Environment,” an items value is roughly based on what other similar items would be worth. For example, a Kelly Blue Book would be used to basically determine a car value. Similar to the “Comps” we would want to present to the Seller. (Video of “How to Present Comparables!”) I say roughly because the intent is NOT to determine what the home is worth; rather a ballpark figure of what you could sell it for.
In a “Pawnshop Environment” you are able to make a full cash offer, paying their closing costs, and close date. If your offer is able to meet their need (as expressed in the Prequalification stage) then you are perhaps able to simply BUY the property!
If you are a Listing Agent, Don’t Worry.
You may be thinking to yourself… “That’s great. I’ve told them what I would be willing to pay as an Investing Realtor®, but I want to leave the door open for the possibility of listing the property if “They don’t go for it.”
The good news is, that you do not have to . In The Red Pill Investor Script Book 5.0 there is a Listing Conversion Script for you!
If you convey that this is simply a “part of your business”, then you leave the “backdoor” open for a way to retrieve the listing if a wholesale deal becomes impossible.
Hopefully, you can begin to see the benefits you could achieve with thorough planning, effective prequalification, energetic pricing presentations and use of a simple scripted Pawnshop Presentation.
For the investing Realtor® or Wholesaler, it cannot be emphasized enough. Your knowledge of the process, along with scripted and prepared responses to the most typical questions will allow you to have the confidence you need to do your job effectively and efficiently.
Please, do me a favor. Tell me what difficulties you’ve had when trying to do a presentation as a wholesaler!