Looking to start investing in Real Estate? Read this guide that is full of information to help the beginning novice learn how to begin mastering the real estate market. From renting, to selling, to buying my goal is to help educate as much as possible.
For this installment, we will learn how to interview prospective sellers to find the best sellers for your needs. Remember those sellers who are flexible are most likely to work out a mutually beneficial agreement in regards to either price, or terms of the sale. While some sellers are flexible in both regards to price and terms, others will only be flexible for one or the other.
As you are speaking to different sellers, you will come to learn how to feel them out just based upon their attitude and tone of voice; however, until then you need to ask a few specific questions to help you determine if they suit your needs. Once you have asked the necessary questions to make your decision, you need to file the property as well as the sellers’ notes away in a file for easy reference. The sellers should be broken down into either good, flexible, inflexible, or rejected.
Obviously, you are not likely to desire working with a seller who is in your rejected pile, unless the property has an incredible either price, or has some other extremely desirable feature. Those who are in the good pile, as those sellers who tend to be flexible in both their price and the terms of the sale. They are the most desirable sellers, as well as a bit harder to find. Flexible sellers represent those who are flexible in either the price or the terms. They are not as flexible as the “good” sellers however, they are still useful.
The last and final group is those in the inflexible category. It is not worth writing these off entirely, after all circumstances may change and someone who was once rigid, may suddenly find themselves forced to liquidate property very quickly and suddenly they are very flexible. These properties can often make the best deal because the seller becomes desperate to get rid of it and move along with their life for some reason or another.
When talking to sellers on the phone make sure, you are polite and listen to what they are saying. You should never call anyone unless you have a pen and paper with you so that you can take notes. You need to find out as much information about the property as possible over the phone so you know if it is worth taking the time to look at in person. If however you find yourself playing phone tag with a seller, take this as a sign that they are busy, and unlikely to have time to be rigid, and more likely to be flexible, or become flexible as they discover how hard it is to sell property when playing a rousing game of phone tag.
In the course of the conversation with the seller you need to find out where the property is located, what type of property it is, who specifically owns it, what is the asking price, the exact size of the property, and if a real estate agent or broker is involved in the sale. These are all very important pieces of information for a buyer and investor to ask of their potential seller so they have a very clear picture of the property they are considering.
Examples of the type of specific information you need to obtain include the sellers name (this is very basic, but often time the novice will forget this extremely important piece of information), the property, this includes location, size, type of property (i.e. multi-family, duplex, condominium, single-family house, etc), the price of the property is also important. Other important pieces of information include existing financing, sometimes great deals can be found on the market in the form of assumable loans find out if this is possible, and if it is who is the lender, how much is owed etc. Some sellers are willing to assist in financing, you need to find out if your potential seller is willing by asking, also ask if how much they would need in the form of a down payment, as well as how much cash they need at closing. Most sellers have specific needs that must be met in order to be satisfied with a sale.
At this point, you should be able to notice that a lot of information is required from the seller before you even consider going to see the property. Continuing along with other vital information is how long has the property been on the market, the longer it is on the market the more likely the seller is to be flexible. Property that has been on the market a mere days has not had time to begin wearing down the sellers with the numerous phone calls and property showings that accompany it.
From an investor standpoint, there are also several very important questions that must be asked to gather a good picture of the overall situation. How long has the owner had the property, as well as why they are selling, some are selling because the house is in need of too many repairs and they simply cannot afford it any longer. While some houses in this condition make great deals for an investor, it is best to know upfront so you can make an informed decision. Other good questions include what the seller likes or dislikes the most about the property, if there are any renters in the neighborhood, or is it strictly homeowners and finally if the seller would be willing to work out a lease option. A lease option is often a great solution to a need for flexible financing.
Remember your goal is to get as much information as possible about the property over the phone so that you can make an informed decision about whether it is worth your time to go look at the property. Not every property you call about will be worth going to look at in person, as well as not all pieces you look at in person will fit into your needs and what you are really looking to buy. By making good phone calls you will save yourself travel time and gas from running all over town looking at properties that do not suit your needs with sellers who you do not want to work with.
In the next installment, we will cover some of the methods used to value a piece of property. Remember often it is the value of the property that determines how good the investment will be. You do not want to ever pay too much for property, else your investment is a bad choice that is unlikely to make you much money, or reap many benefits for your investment business.
For this installment, we will learn how to interview prospective sellers to find the best sellers for your needs. Remember those sellers who are flexible are most likely to work out a mutually beneficial agreement in regards to either price, or terms of the sale. While some sellers are flexible in both regards to price and terms, others will only be flexible for one or the other.
As you are speaking to different sellers, you will come to learn how to feel them out just based upon their attitude and tone of voice; however, until then you need to ask a few specific questions to help you determine if they suit your needs. Once you have asked the necessary questions to make your decision, you need to file the property as well as the sellers’ notes away in a file for easy reference. The sellers should be broken down into either good, flexible, inflexible, or rejected.
Obviously, you are not likely to desire working with a seller who is in your rejected pile, unless the property has an incredible either price, or has some other extremely desirable feature. Those who are in the good pile, as those sellers who tend to be flexible in both their price and the terms of the sale. They are the most desirable sellers, as well as a bit harder to find. Flexible sellers represent those who are flexible in either the price or the terms. They are not as flexible as the “good” sellers however, they are still useful.
The last and final group is those in the inflexible category. It is not worth writing these off entirely, after all circumstances may change and someone who was once rigid, may suddenly find themselves forced to liquidate property very quickly and suddenly they are very flexible. These properties can often make the best deal because the seller becomes desperate to get rid of it and move along with their life for some reason or another.
When talking to sellers on the phone make sure, you are polite and listen to what they are saying. You should never call anyone unless you have a pen and paper with you so that you can take notes. You need to find out as much information about the property as possible over the phone so you know if it is worth taking the time to look at in person. If however you find yourself playing phone tag with a seller, take this as a sign that they are busy, and unlikely to have time to be rigid, and more likely to be flexible, or become flexible as they discover how hard it is to sell property when playing a rousing game of phone tag.
In the course of the conversation with the seller you need to find out where the property is located, what type of property it is, who specifically owns it, what is the asking price, the exact size of the property, and if a real estate agent or broker is involved in the sale. These are all very important pieces of information for a buyer and investor to ask of their potential seller so they have a very clear picture of the property they are considering.
Examples of the type of specific information you need to obtain include the sellers name (this is very basic, but often time the novice will forget this extremely important piece of information), the property, this includes location, size, type of property (i.e. multi-family, duplex, condominium, single-family house, etc), the price of the property is also important. Other important pieces of information include existing financing, sometimes great deals can be found on the market in the form of assumable loans find out if this is possible, and if it is who is the lender, how much is owed etc. Some sellers are willing to assist in financing, you need to find out if your potential seller is willing by asking, also ask if how much they would need in the form of a down payment, as well as how much cash they need at closing. Most sellers have specific needs that must be met in order to be satisfied with a sale.
At this point, you should be able to notice that a lot of information is required from the seller before you even consider going to see the property. Continuing along with other vital information is how long has the property been on the market, the longer it is on the market the more likely the seller is to be flexible. Property that has been on the market a mere days has not had time to begin wearing down the sellers with the numerous phone calls and property showings that accompany it.
From an investor standpoint, there are also several very important questions that must be asked to gather a good picture of the overall situation. How long has the owner had the property, as well as why they are selling, some are selling because the house is in need of too many repairs and they simply cannot afford it any longer. While some houses in this condition make great deals for an investor, it is best to know upfront so you can make an informed decision. Other good questions include what the seller likes or dislikes the most about the property, if there are any renters in the neighborhood, or is it strictly homeowners and finally if the seller would be willing to work out a lease option. A lease option is often a great solution to a need for flexible financing.
Remember your goal is to get as much information as possible about the property over the phone so that you can make an informed decision about whether it is worth your time to go look at the property. Not every property you call about will be worth going to look at in person, as well as not all pieces you look at in person will fit into your needs and what you are really looking to buy. By making good phone calls you will save yourself travel time and gas from running all over town looking at properties that do not suit your needs with sellers who you do not want to work with.
In the next installment, we will cover some of the methods used to value a piece of property. Remember often it is the value of the property that determines how good the investment will be. You do not want to ever pay too much for property, else your investment is a bad choice that is unlikely to make you much money, or reap many benefits for your investment business.
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