I am often asked by new investors as well as seasoned investors how to get the homeowner to agree to doing a short sale.
With the number of investors targeting foreclosures at an all time high, it is tough to separate yourself from the pack.
I have worked with homeowners who receive more than twenty or thirty pieces of mail each day from investors promising to "save" their house.
The vast majority of people I speak to ask to do business with me and here are two reasons why.
I don't try to be someone I am not.
It isn't about tricking someone into doing business with me, or using any special words or phrases some national speaker says works.
It is about simply being who I am.
I do genuinely care for these people who have found themselves in a situation where they are about to lose their home.
I also am in business to make a profit and I don't hide that fact, nor am I afraid of it.
Depending on the amount of rapport I may have built with the homeowner, or the tone of the conversation, I may say something like I have said before, "I just want to make sure you know that I am the enemy.
I am a real estate investor and just like every other real estate investor who has contacted you, my job is to get your house as cheaply as I can.
Some go as far as to say my job is to steal houses from homeowners.
That is why it is so important for you to have someone looking out for your best interests.
The only difference between me and everyone else is that I don't want to trick you into doing something.
I want to make sure you know full well the truth about what can happen from this transaction.
" Of course I say all of that with a smile on my face.
And I don't use those exact words all the time, although it might surprise you that I do use the words "steal" and "enemy" pretty often.
By adding blatant honesty to just being who I am the homeowner sees a genuineness that they don't normally see and it fosters trust.
The second thing I do is to set expectations.
I let them know exactly what is going to happen in the short sale.
I prepare them for the fact that the bank will initially decline our offer.
I prepare them for the amount of very personal paperwork they will need to supply.
I tell them about how long it will take.
We discuss the need for an attorney and a financial advisor and I encourage them to have both.
They know up front that they cannot receive any cash at settlement.
We discuss the deficiency judgment (the real reason they should agree to a short sale), and the fact that it is becoming more common for the lender to pursue a deficiency in one manner or another.
Then I prepare them for what they are going to encounter from other investors who are working foreclosures.
I tell them about how some investors are going to promise to do many of the things they will want, but will not be able to deliver.
I warn them about signing deeds and powers of attorney.
I warn them about all of the little tricks many of the national speakers teach investors to do, some of which are illegal and most of which are predatory.
Then, more often than not, I will get calls from my homeowners to tell me about someone who called or knocked on the door and did exactly what I told them they would do.
Not only does it turn out to be a light-hearted conversation as we laugh about what happened, but it also strengthens my credibility and the homeowner's trust in me.
There is so much more I would like to write in this article but space doesn't allow it.
But, if you would only add these two things to the way you work with homeowners and stop trying to trick them into giving you their house, you will find yourself more successful in building the trust needed for them to give you the house.
Be real, be honest, be ethical, and set expectations.
It is a very simple formula that anyone can duplicate.