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The Secret Deal Maker
August 10, 2010 by Esi · 18 Comments
Last week, I spoke to 2 very motivated sellers ready to accept a lower price than I offered because of changing circumstances.
Seller (Laura) was just recently divorced and as part of the divorce settlement, she was given some of her ex husband’s rental properties. Listening to her story was quite fascinating because I know in most states the couples get to share the assets and this case she became an accidental landlord. The worst part was the tenants stopped paying rent and started avoiding her calls when it was time for them to pay up. It got so bad that she became scared of the tenants since they refused her entry into the houses, by coming up with all sorts of excuses and refusing to come to the door when she went there. Right now she is going through the process of evicting one tenant and wants to evict the other next. The house I am interested in is a 2 family house with one tenant in the lower flat. While my assistant was taking pictures of the outside someone walked out of the house and invited him to come in to take pictures after finding out we were interested in buying the house. Laura was surprised that the tenant let him in the house since they won’t even return her calls. After accessing the house, I made her an offer and she refused and told me she was just going to rent it out to another tenant, so I told her that might just be a better idea, but if she was still interested in selling she should give me a call. 2 days later, I got a call from her and she sounded quite upset and told me she was done dealing with tenants. She’s been trying to contact him…he is still refusing her calls and she was done! done!! done!!!. She suggested that since he was good to my assistant I could keep him in the house as my tenant if I wanted. I was like “No way, he’ll treat my buyer the same way he is treating her, he did us a favor by showing himself to be a problem tenant. I told her after I made the last offer, I noticed I had offered more than I should have on the house and I made a lower offer and to my surprise, she accepted. The problem is that she won’t be ready to sell till later this month after she evicts her tenant. I sent her the contract and my buyer will just have to wait it out
Two weeks ago, I got a lead through webuyhouses.com. Seller (Sasha) got the house through a quit claim deed and was ready to sell. Based on the information I was given after about one hour of conversation, I made an offer and she said she was going to discuss it with her husband. 30 mins later, she called and said her husband thinks the price was too low. After talking for a little while, she informed me that they were going on a camping trip and asked me to call her in 2 weeks. On Saturday I gave her a call and she told me they went by the house and saw the house needed more work than she thought but that her husband was willing to accept $2K less than what I offered 2 weeks before. It turned out that they were much more motivated to sell because of a little leak in the basement. My buyer is going to have his inspector take a look at the house tomorrow, so finger crossed.
Follow up! Follow UP!! FOLOW UP!!! I can’t say that loud enough. I’m still working on being organized and making more follow up calls, but I’ve noticed that when I do follow up with sellers and buyers, I have a better chance of getting a deal.
After reading Rachael’s guest blog post on Julie’s blog titled “A Week in the Life of a Full Time Real Estate Investor”, I decided to give it a try and like Racheal, take Mondays off for admin day. It was a very fulfilling day, I got so much accomplish and felt like I closed last week’s chapter and I’m prepared for this week. I was lucky to have my husband home all day Monday so I spent the day in my home office getting stuff done. And at 9pm I had checked out all the 15 tasks I set out to do. So it’s official every Monday will be admin day for me.
P.S: All the names used in this blog post are not actual names
P.S.S: I was interviewed today by Kendall Matthews for KJAM radio show which will be posted soon. I gave a lot of good content,and did not hold back. As soon as it’s posted, I’ll let you guys know.
“Success comes from taking the initiative and following up… persisting… eloquently expressing the depth of your love. What simple action could you take today to produce a new momentum toward success in your life?” ~Anthony Robbins
Hey Esi, wouldn’t your first seller still be able to get the ball rolling on selling the property while she is in the process of evicting the tenant? A even better incentive for the seller is to tell her don’t worry about the tenant and that you will take care of it for her. Let your buyer know about the situation and see if they are willing to go through the eviction process after they have closed on the property.(Just a thought) Another day in the life of the Flipping mom I suppose. Keep Crushing it!!!
Erby, My buyers usually prefer there is a good paying tenant in the house or the bad tenant is evicted before closing. If my buyer closes on the house before evicting the tenant, he might do some damage to the house that will cost a lot of money to fix, so my buyers would prefer the seller handles the eviction and if there is any damage, before closing we will have to renegotiate the price.
How much time to you typically let pass before you follow up?
Scott Costello´s last blog ..Book Review- Tribes by Seth Godin
Hey Scott, I usually try to follow up every month and sometimes in 2 weeks in I know the seller is very motivated, and wants a few thousand dollars over my asking price, I propose to meet them half way as long as they pay their closing costs and it works for me most of the time.
Hey Esi -
I am so happy to hear your results of taking Monday’s as an admin day … I’ve been thinking about taking Friday as an admin day or at least dedicating Friday afternoon to admin but I always seem to have things to do. I always dedicated the 15th of the month to admin … but one day a month doesn’t cut it!!
Follow up is so critical in every aspect of the real estate business. I don’t think any of us can say it too much. Good post!! Look forward to your radio podcast!!
Julie
Julie Broad´s last blog ..What Makes a Good Investment Market
Yes Julie, it worked great for me and I’ll try to keep it up. I thought of Friday as a good alternative, but for some reason it’s ingrained in my mind as the end of the week and a relaxing day, even though I still end up working. I’m going to dedicate a day a week just for follow ups.
Thanks to you and Rachael
Good post Esi,
This is one thing I’ve got to get better at. I really drop the ball with follow up.
My main challenge is that we generate so many new leads I tend to forget about the old leads. I think I need to hire someone and assign them the task of following up on old leads!!
Matt K´s last blog ..107 Granger Demo – House Flip Video Update
I know what you mean Matt. We also do a lot of marketing and get lots of leads, so it’s a challenge calling new leads and following up on old leads. I just have to figure out how to make it all work out.
Awesome, Esi! I’m really glad that the Monday admin day is working for you. I just created a new schedule that I’m going to try out….we’ll see how it works!
Shae´s last blog ..Book Review- My Life & 1000 Houses by Mitch Stephen
Who knew that a comment on your blog was going to lead to a blog post on Julie’s blog and transform people’s lives. It has definitely got me thinking of how to dedicate certain days to certain tasks and I’ll keep experimenting till I get it just right. Let me know how you new schedule works for you.
I certainly will! And yes…that’s the power of the internet! Love it
Shae´s last blog ..Book Review- My Life & 1000 Houses by Mitch Stephen
Hey Esi, Great content, I usually end up doing admin. work most of the day, everyday, I will try dedicating one day out of the week as suggested and see if that works better. Thanks for sharing!
Reeshemah! What a beautiful name. What is the meaning of your name if you don’t mind sharing? I also do admin work everyday, but I’m trying to be more organized and dedicate certain days to certain activities. I don’t consider what I do work, so i end up spending a long time doing it and not paying as much attention to do other things. Give it a try girl, you might like it.
Hi Esi,
You’re making excellent progress, as always. I am looking forward to your interview. I subscribed to Kendall’s podcasts after Shae’s interview, so I hope to hear yours soon!
Take care,
Steph
AnotherSteph´s last blog ..CPH Offer Update
Thanks Steph, though I’m hard on myself and feel like I should be doing more, and my brain is constantly thinking of how to do better… I need a vacation. I’m looking forward to the interview too and I hope you enjoy it.
Nice post, Esi!
Oh, that’s so crazy about the landlord trying to sell you the home with problem tenants. As a prior landlord, you probably know my thoughts on that one…no way!! I’ve had that same situation with sellers and their problem tenants before. My philosophy is that I don’t want to take on people’s problems. Yes, I want to help solve them but I don’t want to be the one dealing with their problems. Some folks think they can just throw their problems at someone else. It’s good you decided not to take the home with the problem tenants, that may have turned into a nightmare!
I cannot agree with you more about follow up. I think I commented on a post (either Shae’s or Julie’s) before that in advertising it takes about 2-7 times of exposure for someone to buy a product. The same thing can be applied here as well. So many times, it’s been the follow up that has led to the sale.
Great to hear your progress, I really enjoy reading your stories. I can tell, you’re really skilled at negotiating, that’s great – thanks for sharing!
p.s. Thanks for the mention on the guest blog post I wrote for Julie! I’m glad it helped you (and those who read it). I think everyone has a different way of doing things. My schedule kind of just caters to my personality. When I was in sales, Mondays were usually considered my “admin” days (no one really wants to hear from a sales person on Mondays!) and Fridays my fun days (people are usually happy on Fridays!), I guess I’ve just kind of worked this pattern into the REI biz!
Hey Rachael, I know what you mean, I was surprised when she said I should keep her problem tenant, lol. This is exactly why I am not ready to be a landlord though if i’m going to buy and hold it’s going to be in commercial real estate (storage, corner malls or highrise apartments). Thanks for your support, you are so down to earth and I really enjoyed our convo, let chat again soon.