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How to Negotiate the Best Offer with Home Sellers

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on Thursday, 08 June 2017
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After you've calculated your maximum offer, you will need to present it to the sellers. This is something often best done in person, but can also be done over the phone or through the mail or email. It's usually best to choose the method the seller would be most comfortable with.

Often, sellers will think they should get more for their home than they will. When you ask them what they think the home should sell for in the current condition, they will likely give you a much higher number than it's worth. However, they may also believe you're going to talk them down, so they want to start high instead of low.

When it comes to negotiating, you may want to start lower as well, which will give you room to go up. However, if you don't start high enough, you may insult the seller and lose the entire deal. The negotiation process is very delicate, and it can be tricky. Here are a few tips to help.

Rapport Goes a Long Way

You don't want to be disingenuous, but you want to build a strong relationship with your seller. Sincerity is always best and you shouldn't start off negotiating right from the beginning. Find some common ground and remember, you're human, and so is the seller.

Listen Most

While negotiations require you to do some speaking, you want to listen more than you speak. When you talk too much, the deal may fall apart for many different reasons. However, when you listen and let the seller speak, you will find out more and you will be able to make a better deal because of the information you gain.

Find the Pain Points

The price is usually going to be the main point for you in any wholesale deal. However, there will be other pain points, which can be used during negotiations. You may find out that your motivated seller is overwhelmed by the repairs to the property or with managing the property as a landlord. Maybe they need to sell fast. There are several other pain points outside of the price you can use during negotiations.

Be willing to Walk Away

While you don't want to walk away from a deal, if you're willing to, you won't negotiate the with desperation. You want to continue to negotiate until you find the right deal, but you want to do it with the willingness to walk away if a good deal cannot be reached for both parties.

Negotiating with a seller isn't always easy. You have to know what you're getting into and you have to have a strategy. Know how to listen and be ready to walk away when the numbers don’t work.

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Setting & Achieving Your Wholesaling Goals

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on Wednesday, 24 May 2017
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Real estate wholesaling isn't a hobby. If you treat it as such, you'll probably never achieve your real goals. However, when you treat wholesaling as a business and you set solid goals, you'll have the ability to achieve them.

When you're new to wholesaling, you have to set proper goals to keep you moving forward. Wholesaling is all about finding deals, but there's more to it. Here's a breakdown for setting your wholesaling goals.

Your First Month

As a newbie to wholesaling, it's best to get your feet wet right from the beginning. Find one to three neighborhoods you want to target and start finding some buyers. You don't have to have a list of hundreds or thousands of buyers in your first month. Just find 5-10 quality buyers and you will be well on your way.

Goals for your first month include:

Choose 1-3 neighborhoods to target

Find 5-10 potential buyers

Get the phone number and email for each potential buyer

Your Second Month

You've set the foundation and it's time to start reaching out to motivated sellers. This month, you will start marketing and finding deals.

Goals for your second month include:

Do market analysis and choose your target area

Pull lists from online sources or go driving for dollars to find potential sellers

Choose your marketing methods (direct mail, bandit signs, internet, etc.)

Set up all the necessary details for your marketing

Send out your first mailer, place your first bandit signs and start marketing online

Reaching $100,000 Per Year

If you’re not making this much yet, a good goal for a new wholesaler is to reach $100K per year in income. Then just 10x that to hit your $1M mark. Start with the first two months above and once you have your marketing in order and you're building a buyer's list, you can move on to an actual income goal.

The best way to set your income goal is to figure out the average you will make from a wholesale deal. Then, figure out how many deals you need to do. For example, if you average $10K per month, you only need to do 10 deals to reach $100K.

Once you know how many deals are necessary, it's just a numbers game. Figure out your marketing conversion rate and how many leads turn into deals. Then, just market enough to get the 10 deals you need to make $100K.

Many new wholesalers make it harder than it needs to be. Set up your foundation in the first two months by getting your marketing going and creating your buyer's list. Then, as the deals start to come in, keep track of the numbers. This will allow you to set and achieve your income goals as a new wholesaler.

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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Make More Money Doing Less Real Estate Deals This Year

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on Thursday, 05 May 2016
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Is focusing on fewer deals actually the key to making more money in real estate this year?

Real estate investors, agents, and other professionals often rush in and try to ramp up as much volume as they can. They perceive volume as the path to more money, and more freedom. But that’s not always the reality. In fact; it frequently ends up delivering the opposite results.

Even when you look at massive giants like Zillow and Airbnb, they often just post bigger annual losses. That’s not to say volume and market share can’t one day turn into profit. But common sense says to build a model you can scale, not to create a big business and then hope you can make money from it.

Going after volume first can often just mean being busier. It can mean being busy hiring, training, managing, putting out fires, and sometimes for less money. Flipping more houses is great, but the focus should absolutely be on profit.

Ask yourself what’s better; doing one wholesale deal and making $100k this month, or trying to do 10 rehabs for $10k each this month? Which will give you more of what you really want?

Take a look at the deals you’ve done over the last year; which are the most profitable top 20%? What’s different about those deals, and what do they have in common? How can you do more of those and less of the bottom 80%?

Your time is literally priceless. Don’t waste it. Get the most return on your time that you can. When you do that you’ll have the freedom to do more volume with deals that have even better profit margins, but you’ll be able to afford to take time off for the things that are even more important.

Some ways to get a better ROI on your time may include; delegating more and micromanaging less, streamlining your financing strategy, wholesaling versus rehabbing or renting real estate.

Build in more profit by slashing your turn times on deals, negotiating better rates with vendors or paying them more to take on more responsibility, building relationships with good buyers that won’t nickel and dime you on deals, and empowering any team members you have to make decisions faster based on a good system.

Net profit or volume – which is your goal this year?

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding and hard money loans for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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