myEmpirePROYou are about to discover a secret to capturing the right wholesale house prospect that you would have never found anywhere.
There is the right offer.
But there is also the right prospect to attract.
On average overtime, it makes creating the right offer and getting accepted even better and easier.
The right offer always comes in a group of options (cash, retail, creative) to give the prospect the illusion that you are their messiah.
Master this and your offers on wholesale houses will be accepted a lot more often.
Below is a question for us to address with this lesson on wholesale houses for profits…
“Spoke with a seller who countered my all cash offer with a financing offer.
He wants $10,000 down and interest only payments for 2 years on remaining balance.
Asking price of $160,000 ARV $240,000.
The home Needs upgrading and new HVAC unit.
Would that be a deal or do I need to counter?”
Enjoy the video.
When a seller counters your cash offer with “creative financing” as a suggestion, It’s bad.
…An indication… just not motivated enough.
But wait…
It could also be that you are simply not in control of the conversation.
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To wholesale houses successfully…
What you need is a pipeline of leads and motivated sellers on one side…
And on the other side, you need a growing pipeline potential buyers and investors who can start buying today.
If you have to start putting down earnest money deposits of $10,000 with anticipation to pay interests, that’s not your seller.
At ARV (after repair value) of $240,000, asking price of $160,000 is 67% of the ARV.
That is not a bad place to start a negotiation but the property needs repairs and upgrade.
Therefore it’s not a deal good enough to wholesale the house yet…
So to get closer to turning it into a closed deal…
You have to be the one asking quality questions that drives the conversation.
After your fact finding, you should prepare and offer that provides 3 different options.
That will give your seller the illusion of being in control but you retain the control.
You also use that to buy influence and respect from them.
People have to feel like they know, like and trust you in order to do business with you.
So what are these 3 offers that makes a right offer to wholesale a house and CLOSE?
(1) Cash Offer
Ideally, your perfect prospect is running out of time and needs to get rid of a property as soon as possible.
They are motivated by “a need to buy time”.
…it doesn’t matter how low the offer is as compared to the ARV.
So they will be more receptive to a cash offer if there is room in the equity to entertain it.
If they are a truly motivated, they will entertain shortsales negotiations with their mortgage company
…in the case of underwater mortgage whereby they owe more than the houses is worth.
If they are truly motivated but have no cash to fix the house, this offer option would be more attractive.
(2) Retail
This is your 2nd offer which would only appeal to a prospect who is motivated by money.
This prospect have time to secure the biggest bag of money.
So you need to present an offer of the actual after repair value of the property.
But you will simply let the seller know that they need to fix up the property for an ideal new owner in order to make it happen.
Presenting an offer that doesn’t has this offer will make the seller feel disrespected by a low ball offer
On the flip side, this type of seller will appreciate that you gave them a honest information about the worth of their property all fixed up.
(3) Creative
This will be your 3rd offer ideal for a property where your seller needs some cash but doesn’t care too much about structure of the deal.
The rental in the area is really nice.
The owner have a nice chunk of equity.
The need some cash now but can fix and wait 60 – 100 days to sell.
Last but not least, only a truly motivated seller will be open to this offer.
You can present it as a last resort.
In conclusion, the key to success in dealing with wholesale house prospects is to prequalify
…and make sure the seller is motivated.
Present the first 2 offer options and wait for them to choose.
Your job is to execute whichever option the seller gravitates towards the most.
Essentially, there is no need for you to sell.
You simply want them to feel free to rely on you to solve their problem.
When you execute on their choice, you make money wholesaling houses over and over again.
