Glenn’s Coaching Corner – Getting YOUR Offer Accepted

Blog | Posted On: 10.18.16

As real estate investors we make our money when we BUY property, but we don’t REALIZE our profit until the house is sold.  So we must buy them right!  If we don’t buy the property correctly, we will never make the deal work in the end.  One of the most difficult things new people have to get used to doing is making low offers.  They might be embarrassed, or even “slimy”, offering someone 50¢ on the dollar or less for a house.  Let’s face it, most sellers are very unrealistic with what they feel their home is worth.

They may be emotionally attached and need some time to “tenderize” (a common term in our office), to understand that it’s NOT worth top dollar as they initially thought. Time has a funny way of making us realize what things are really worth and accepting the truth no matter how bad it is.

How We Present a Low Offer, Without Being Insulting

If I am going to punch you in the gut, but I tell you first, at least you’ll have time to prepare and tense up your abs!  It may still hurt, but not as much as if you were just lying there taking a nap and I pummeled you!  A technique we have used since the beginning is to add a cover letter to our offers when needed.  First, nothing beats a good conversation with the seller in which you are a great listener and look for the way you can solve their problem.  People WILL sell to people they like for less money simply because they like you.  We have dozens of real life examples.  Be their friend, solve their problem, start to soften them up to a realistic offer from the first conversation so when you are ready for the main offer, it won’t be like a punch in the gut while napping!

The Strategy We Used

We placed on offer on a home in a great neighborhood.  I was contacted by the listing agent, with whom I’ve developed a great relationship with over the years.  She let me know that there have been NO offers, and the sellers who are out of state would like to unload the home by winter.  It was obviously an estate, and sadly, the family installed a toilet in the kitchen to help the parents.

Yes, you read correct … a TOLIET IN THE KITCHEN!!

I’m not on the board of health, but I’m thinking this may not pass some type of code!!  Well, my assumption is that the house will sit for a lot longer due to that and other reasons.  I was not able to speak to the sellers directly and our offer was for $100K less than asking.

The Letter We Attached to Our Offer:

How’d we do?

Well of course I’m using this example because it was a huge success!!  NOT!!  Our offer was rejected immediately!  Their exact response was “We are not that desperate yet”.  However, I’m a patient man (don’t ask my wife that question) and I’ll wait them out.  Notice the key word they said, “YET”.  Winter will be upon us soon and then taxes will be due, heating bills will skyrocket, the house will be vulnerable, as it is vacant, and when they are ready I will still be here.  They need time to “tenderize” and come to grips with the reality of their situation.

By writing a cover letter it sets us apart from all the other vultures who simply send a low offer and usually just offend people.  Try to develop a rapport with the sellers and set yourself apart as a real person who is trying to help them while also running a business for yourself and family.  You’ll get more offers accepted than you can imagine.

Remember, people don’t care how much you know, until they know how much you care!

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