In real estate, the art of negotiation is essential. We want to get the best value as real estate investors when we buy houses. There are little tricks of the trade that you can use when negotiating your next deal. As well as the best ways of finding them. From start to finish, it is a constant uphill battle. Sometimes you may find a deal that closes with no problem; other times, there may be a struggle. Can start to finish, it is an actual effort needed to be made. What exactly goes into each deal? There are plenty of people who’ve been in real estate for an extended period. It will tell you the same thing as far as negotiation. Silence is golden; the first to talk usually loses. If you are looking to become a professional negotiator, maybe we can help you. It is easy to learn how to do almost anything nowadays. Especially when it comes to real estate investment. Negotiation is accessible and can be learned. However, some people struggle with it even after being told different tricks. Do not expect to become an expert overnight. Time and patience is the only way.
Finding the deal
Every investor wants to find the best deal on their next fix and flip or rental. The easiest way to do that is by marketing. If you’re not putting any money into the marketing or no leg effort, you will not find any deals. Some companies spend thousands of dollars on Google paid ads. This is an effective way if you have the money to do it. Other people will use text messaging or cold calling to reach out to motivated sellers. It is a very grueling and time-consuming process. But you can find some decent deals this way. Many people are using mailers or postcards, sending out a batch of them at a time. Typically they’ll pay $0.10 per postage and send out a thousand of them. You may even see “sell my house fast” or “we buy houses” signs posted on telephone poles. These are a very effective way of getting motivated sellers.
Negotiation
Once you find a motivated seller who’s looking to sell. Typically they will ask for you to provide them with an offer. It is when negotiation becomes handy. Usually, you would want to start in a lower number than what you were being able to pay for the property. Coming in at a lower number brings the homeowner down to reality. You don’t want to go too low because you do not want to offend the homeowner. Maybe come in 10 to $20,000 less than you can afford. Once you do this, they may counter offer you. Always say less than the homeowner. Allow them to talk more; they give up more information when people speak more. Which will give you the upper hand. If you can get a number out of them, that is a great start. Sometimes homeowners kind of know the number that they want. Allowing you to know right off the beginning of the deal makes sense.
Handling title
Clearing title is one of the most significant parts of any real estate transaction. Especially if it’s a cash for homes deal. If the property is in bad shape, it is most likely that they have liens or judgments against it. Typically you can find the stuff out through any City website. You’re able to at least access the taxes that are owed and any liens against the property. Usually, the truth doesn’t come out until the title commitment comes back. It is when the underwriter gives you a piece of paper stating all the money owed on the property. If you do not use the right title company, these liens and judgments can seem almost impossible to clear. Sometimes the amount owed is more than the property is worth. And the event that this is the case, it will not allow you to close. Unless you were willing to pay above the amount. There are plenty of times when homeowners walk with close to nothing if they have not taken care of the property or the money owed.
Setting closing
Once you get to the final stages, you can schedule a day for closing. These days can be some of the challenging times. The room feeling very intense during the ending is very likely to happen. Yes, everybody is excited to get paid. But sometimes, tensions run high. There’s a lot of back and forth and arguments that can break out. A homeowner may not be happy with the amount of money they are walking with, leaving it to feel like it may never close. Staying cool and calm in these situations and understanding what is going on is the way to complete the property. Depending on the financing, it can take longer than an hour for settlement. Usually, everybody wants to get in and out; the title company wants you to move on. Because they have other closings to handle that day.
The more you do
Your first deal could seem almost impossible to get done. But once you have completed one, you can carry the knowledge over and do it again. The more you do, the better off you will handle certain situations. We want to make sure we’re getting the best deal when we buy houses. As long as you know your numbers or learn from an expert, you should have no problem doing so. There are plenty of mentorships out there teaching people how to complete a real estate transaction from start to finish. They will even provide you with contracts and details on how to fill everything out. Creating a good relationship with title companies helps out tremendously when it comes time to do more deals. The reason being is that they will work with you and help you the more they know you. In real estate, it is all about the connections you build.