Posted by Susan L.–FL on December 30, 1999 at 13:10:03:
Posted by Susan L.–FL on December 30, 1999 at 13:10:03:
Those @#%& Realtors!!! - Posted by Jim LaVerdi
Posted by Jim LaVerdi on December 23, 1999 at 19:55:37:
I have a question! Why is it that every time I call a realtor who has a listing and I ask of the property specs, they are so happy to work with me , but…When I ask if the seller is motivated enough to take back a second or if they were ok with a subject to deal, they will 9 out of 10 times tell me "Oh no! This seller wants to cash out etc. What is it with them already!!. Do they not want to sell property for homeowners?. How do they know that the seller wouldn’t accept this without it being put in front of them on paper? Is there a way that I could by-pass the realtor and present the offer to the seller myself. (Let the realtor get his/her fee) I don’t have a problem with that. I do, however have a big problem with taking that silly answer from every one of them when I call!!! They don’t even consider my suggestions they just tell me flat out NO. How can I get around this problem?
Thanks for the help
Re: Those @#%& Realtors!!! - Posted by chris
Posted by chris on December 25, 1999 at 01:22:30:
Clause in your offer stating something along the lines that “buyer reserves the right to accompany broker to present offer.” If their broker is not enthusiastic the way they present the deal will not sell it. You could meet the broker at the seller’s place and when you meet the sellers make sure to add some sugar coating such as that their broker was nice enough to allow you to accompany him/her to present your offer.
After you present your offer, get the seller’s phone number and ask them if you could call later to speak if you need any additional info. They may be as annoyed with the broker as you are. Hope this helps.
Good luck, Chris
Re: The Key: CONTROL your deal… - Posted by Ed Garcia
Posted by Ed Garcia on December 24, 1999 at 13:10:56:
The Key: CONTROL your deal.
Be more prepared for the realtor, than they are for you.
Here we are talking about realtors like they are a third world.
We all know that as a whole, realtors can be a deal killer.
With that in mind, we need to be prepared for the realtor.
John Behle touched on educating your realtor. You can educate your
realtor, but inevitability there will be a sellers realtor that you have no
report with that can kill your deal.
I’m a control freak. I’m a take charge person, I’m sure you can tell by
my post. John Behle and myself have an advantage over the majority of
you with our financial knowledge, and 200 years of experience.
Just joking about the 200 years, it just seems like 200 years.
CONTROL. When I do a deal, I explain to my realtor that it’s my policy,
that after I make my offer, and it’s excepted, that I meet the seller.
My offer is always a CASH offer. My main objective at this point is to
establish the best price, and CASH talks.
Do I always have the cash? No
But remember, the result of financed money, is cash to the buyer.
So I always consider them one and the same. The seller can not distinguish
my cash from borrowed cash. Their concern is time, and can I do the deal.
If the seller will not accept my deal then I will counter with terms and
conditions. (NOTE: I always find out how long the property has been on
the market. That’s important because if a seller was not motivated before,
they now are ready to adjust their price.)
Another NOTE: If there is a lot of action on a property, I stay away from it.
Another NOTE: I find the hardest person to control in a deal, is myself.
Once I can control myself, everything falls in to place because this attitude
seems to carry into the deal.
When I tell the realtor, that I want to meet with the seller, they usually ask
for what reason, and try to convince me that it’s not necessary.
I explain to them, that I’m spending a lot of money on the property and that
it’s my policy, that I meet with the seller to find out first hand what was done
with the property. Of course they then tell me to write down what I would
like to know, and they would be happy present my questions to the owner.
At that point I become adamant about it and ask, is there a problem with this
deal? Is there a reason the seller does not want to meet with me? Are they
hiding something? The realtor then says, of course not.
I then say, good, when can we meet.
It’s important that you side step the realtor. But you have to do it in a manner
that the realtor understands. When I meet with the seller the first time, the realtor
usually wants to be present, if so? I will always ask the seller for their phone number.
That allows me to meet with, or speak to the seller on another occasion with out the
realtor leaning over my shoulder. I then can find out the motivation from the seller
first hand, and know what different ways I can work the deal.
( remember there is no law against me calling the seller, and telling them, that I still
want to do the deal, but we need to restructure it).
Is this the only way I handle dealing with a realtor? Of course not.
I have to be just as flexible as the next guy. But it gives you just one example of what
I have in my arsenal or bag of tricks.
My knowledge of financing makes everything happen for me, because I project a
confidence in doing a deal that gives the realtor trust that the deal will go down.
When they hear the word CASH, they think nothing can go wrong with the deal.
When I go back to restructure the deal, because I tell them I decided that I didn’t want
to put so much cash into the deal, believe it or not, they understand.
When they see me working in harmony with the seller, at that point they realize that
the deal will go down, and there is nothing for them to do.
I can’t tell you how many times I have had a realtor tell me, I can’t believe the seller is
going for this deal.
Once I start to work a deal, unless the realtor is completely stupid, they stay out of my way.
My attitude is that there are going to be problems in every deal, and I consider myself
a problem solver. But in order to solve those problems, I have to take CONTROL.
To me, everything you folks have been talking about, is just BUSINESS AS USUAL.
It come with the territory, so be ready for it.
Do Not Forget - Posted by thom
Posted by thom on December 24, 1999 at 11:32:05:
The listing real estate agent works for the seller…
Please don’t ask him:
Is the seller motivated?
Will he carry a second?
Why is he selling?
He can’t answer those questions. If you have an offer. PUT IT IN WRITING, then it must be presented and the seller will make the decision. If it a good offer you will have bought the house, if not then move on.
If you want an agent to work for you the hire him, but as I have said before: If you’re not buying properties don’t expect the agent to hang around to long, they only get paid when the deal is done.
Re: Those @#%& Realtors!!! - Posted by Rafael_FL
Posted by Rafael_FL on December 24, 1999 at 08:48:17:
I would like to share this insight with everyone. Sometimes everyone hears the word realtor, and forgets that ultimately they are salespeople who are paid commission. I am a finance manager for the 2nd largest automotive group in the country. We can and should hire only the best, but we often fill up the desks with warm bodies when the supply of qualified individuals is low. As the finance manager, it is my responsibility to 1st make sure the deal sticks, and the front end gross is intact, then to make as much profit for the dealership as I can. That is how we keep the doors open. The thing is, I often get more resistance from the salespeople than I do from the customer regarding finance. They are afraid that I will upset a customer that they spent hours with by trying to make a profit in finance, and their commission will walk out the door. I am slowly getting over this issue by training them on what finance is about (they get paid 5% of what I generate), and let them sit in on my presentation if they are concerned, so that they can see I am a professional, and treat their customer well. I have heard from a saleswoman who has been there 15 years “they can get 6.5% at their bank”. This is to stop the finance presentation. I interview the customer and find out they never discussed rate, and have no idea of what they can get. Their last car loan 12 years ago was at 11%. I have customers who came in apprehensive because they caught the scent of fear on their salesperson, but when they walked out I have a 2 or 3 thousand dollar backend deal, and the customer is very excited. The point is, you need to let them see you as a professional (sales reps and customers), school them ahead of time and never 100% believe what the sales rep/realtor is saying. It is coming from their fear and lack of knowledge. Hope this helps a few of you out there.
First and foremost, realtors only seem … - Posted by SusanL.–FL
Posted by SusanL.–FL on December 24, 1999 at 08:27:43:
…concerned about getting their (entire) commission check at closing.
Secondly, they don?t understand ?creative real estate? —and (unfortunately for us) don?t seem to WANT to learn!
A few years back I was lucky to work with a realtor who ?understood? monthly income streams. On our FIRST deal together, to close the deal, he offered to take his commission in monthly increments (on an interest-free basis). We worked together well. I referred a LOT of business his way over the years?and he surely appreciated. (One hand washes the other, I always say!)
Unfortunately, he got SICK and tired of all the housewives half-heartedly trying to sell real estate (part time). He got disgusted, quit, and went back to painting houses for a living.
P.S. I have a book at home that contains several EXCELLENT chapters on ‘training’ realtors to our way of ‘thinking’… (the art of persuasion).
If you would like the title to the book, I’ll get it for you. (can’t remember it offhand)
Training and fear - Posted by John Behle
Posted by John Behle on December 23, 1999 at 23:55:06:
Agents aren’t trained in seller financing. Read a couple creative real estate books and you can pick up more about seller financing than the average agent.
In addition, agents see seller financing as risky. There are many lawsuits and problems and the real estate division and brokers drive it into the agent’s heads.
Technically agents are violating both their fiduciary responsibility to the seller and their own code of ethics to be as negative as they are and reject potential offers of seller financing. Yet, they do it constantly.
An agent only has a few hours education on financing and very little of that has any relation to seller financing. Agents only become aware of it as a tool over time or if someone educates them. As an example, my continuing education course on “Safer Seller Financing” is the only one of it’s kind in the state.
At times I have to even offer it for free to get agents out to it.
The bad news is agents don’t understand paper and how to work with it.
The good news is agents don’t understand paper and how to work with it.
You just have to learn how to work with them, present offers, educate the agents (a little) and find the right properties and sellers.
The only way to get through an agent’s resistance can be to present the offer. You have to get a sense that the seller might be open to paper and able to take it. You can always demand that the offer is presented, but once it is listed, you need to go through the agent. Of course, you could go to the seller and even strike a deal, but the agent would still be owed a commission. If you are unlicensed, you could do that. A licensee cannot bypass the other agent.
Many of my offers are sophisticated and complicated. I will usually meet with the agent to explain the offer first. If the agent at least takes a neutral stand on the offer I may present it. At times I go to the broker also and even involve them in the presentation. If both have a negative attitude, I will likely NOT present the offer.
Which comes down to the question of forcing them to present the offer. I rarely do that because an agent with a bad attitude is death to negotiations. I hate that feeling when a seller turns to the agent and says “what do you think” and the agent says “I don’t know, I don’t understand it - but it scares me”. Now there is a wasted evening.
By the way, I’m not being harsh on agents. I’ve been an agent for 21 years and a broker for 18. Some agents have risen way above the average through their education and dedication to being a professional. Those reading this forum would fit into that category.
It’s isn’t the realtor’s silly answer . . . - Posted by Joe Kaiser
Posted by Joe Kaiser on December 23, 1999 at 23:18:53:
It’s your silly question. One of the thing you need to do constantly is monitor your efforts and guage your results. That means when you get “that silly answer from every one of them,” you’re not fine tuning your approach.
Stop asking questions no agent could ever really answer anyway!
I prefer sitting down with sellers face to face. In the real world, with agents involved, that isn’t going to happen. So, we don’t just bang our heads against the wall and demand to be present when the offer is submitted. That creates problems for everyone and our job is to solve problems, not create them.
Get yourself a good realtor who can present your offer and get your ideas across. Sure, it takes awhile to find such an animal, but that’s just part of the process.
I avoid listed property whenever possible. But when I know there’s a deal there to be had, I have no problem letting my agent get in there and mix it up.
Tell Them What They Want to Hear - Posted by PeteH(NYC)
Posted by PeteH(NYC) on December 23, 1999 at 21:50:29:
A realtor will always want a full-price, all-cash offer. Why? Because it requires no effort. They have no incentive to let you bend the rules to your advantage – unless you give it to them.
A realtor is legally obligated to present every offer to the seller. BUT: this means every WRITTEN offer. By just asking questions such as, “do you suppose the seller would go for holding a second mortgage to let me get the property for no money down?”, what incentive is there for the realtor to do you that favor? Put your specific offer in writing, with a clause that says “buyer reserves the right to accompany broker at presentation of offer to seller,” or suchlike. Broker HAS to present your offer (or else you report him to local board of realtors), and by insisting that you be present, you can explain the mechanics of the offer and how it will benefit the seller while at the same time doing damage control on how the realtor may have been tempted to present the offer (“it sucks, and you probably can’t rely on this guy to make the payments he’s promising”).
You could go even further to offer the broker an incentive: suppose you offered to pay his commission, or at least some kind of fee upon closing of the deal? Money has proven to be a very effective persuader.
The point is, if you’re not out locating potential deals yourself, combing the neighborhoods, looking for FSBO signs, finding neglected properties and looking up their owners in the tax rolls, calling burned-out landlords from eviction filings (all of which you should be doing anyway), YOU HAVE TO WORK WITH BROKERS. Realize that by making it worth their while you’ll get much farther, and give them a reason to take you seriously.
Re: Those @#%& Realtors!!! - Posted by Bill K. - - FL
Posted by Bill K. - - FL on December 23, 1999 at 21:26:42:
I am a investor/broker in FL. Let me give you my thoughts on this at least as the laws of FL are concerned. The listing agent is required to present ALL written offers to the seller. They are not supposed to second guess what the seller will accept. That is the law and if they don’t do that they can be in trouble with the state RE Commission. The only time they can tell you no owner financing is when they have it in writing from the seller. Here’s what I would suggest you do. Find yourself a good Buyer’s agent that will represent you, that you can work with, and understands what you want to accomplish. There are more companies now that specialize in working only with buyers. They don’t take listings. Their job is to represent you not the seller.
Re: Those @#%& Realtors!!! - Posted by David MacGown
Posted by David MacGown on December 23, 1999 at 20:38:12:
Ain’t that the truth! I have heard “they want to cash out” a bazillion times! I think that 99.9% of Realtors are not in the business to sell homes. They at least have no interest in serving their clients. They would rather let a property Sit in the market for over a year at over fair market value then deal a house non-traditionally.
If a house was listed at 100K and the realtor reduces the price by 10K after 6 mo. (somebody will bite at that price as they try to convince the seller to relist for 6 more months) the Realtor has only “sacrificed” $700 @ 7% commission. The seller is out $10,000 + the mortgage and taxes and maintenence each month.
I remember looking in the local homes magazine in October and seing some pictures of houses with snow on the roof FROM LAST WINTER!
The sad thing is because traditional home buying and selling is dominated by brokers, some people may never realize they don’t know what they don’t know!
But istead of talking about how bad realtors are lets think of a solution. 85% of sellers list their homes with brokers. If we can’t beat them lets join them!
Let’s find a way to feed their greed, solve the sellers problem, put money in our pockets, AND have Realtors fighting for our business, begging us to do business with them. How wealthy and happy would we be?
Please read the thread above this (REALTORS and lease options)
Lets get a mastermind group going here and solve this problem once and for all!
I’d like title,author… - Posted by Ken.K.(IL)
Posted by Ken.K.(IL) on December 24, 1999 at 10:51:09:
of the book you mentioned…dealing with ‘training’ realtors to our way of thinking…It reminds me of a Dale Carnegie course I took several years back.‘How to Win Friends & Influence People’…anyway…if you would send info., I’d sure appreciate it!..Merry Christmas All & Happy Holidays…
Re: Training and fear - Posted by Stu
Posted by Stu on December 27, 1999 at 17:30:34:
I’m new to this forum, and in reading the recent questions and answers, I was a little taken back by all the anger expressed, concerning real estate agents, by some of you that are obviously well schooled in the creative financing end of buying real estate. But I don’t know why I should be. I have been a RE agent for only 18 month and know well that what you are saying about the majority of those @#$% Realtors is true, but I don’t quite understand how they have all become so narrowminded and self serving. A monthly income would surely add up to the same as a one time cash influx, especially on a property that might not sell for a long time, if at all. By that time my disgruntled seller would probably have listed with another agent anyway, and I’d end up with zip.
I think the most correct assessment you made is that the average realtor is very under educated in the financial aspects of real estate outside of the " call a bank or mortgage lender and let him do all the work" attitude. The problem is they see no advantage to learning more. Their focus is 100% on closing ASAP for enough to maximize their commission.
The biggest obstacle investors like yourselves, and hopefully myself as soon as I can learn enough to intelligently participate, have to over come with realtors is that the are immediately suspicious and paranoid about dealing with anyone the feel is beyond their control. I mean, it’s bad enough that in the short time I’ve been doing this I’ve discovered that a large percentage of real estate agents are the biggest group of liars and crooks imaginable. But at least they feel safe eaeling with each other because they do share some common threads of understanding that
are the same for every deal. And after a while of dealing with the same agents over and over it’s tempting to settle into " the devil you know" type of pattern. Your type of aggression and enterpreneurial vitality is like opening pandoras box to most of them. I had a construction business of my own for 20+ years and started doing this because of physical problems. What I have discovered is that this industry is not filled with real creative thinkers or problem solvers. It’s mostly just salesman. Personally I’m disappointed. It’s a “go along to get along” mass mentality that I find stifling and irritating.
I personally would welcome locating properties for creative investors as a change from the boredom of the business, but I am a rare exception to the norm.
NOTE:I personally don’t suggest your asking to be present when an offer is presented. An educated agent working for you would have a much better chance of making the other agents he deals with on a regular basis comfortable with presentations like the ones you need.
Also, never let any tell you what his buyer will and will not accept. That’s not his job and he is obligated to present any WRITTEN. Do submit offers in writing. Don’t take the word of some listing agent that the offer was rejected. Ask that any reply also be in writing signed by the seller.
I don’t see that south Jersey is a hotbed of action for your subscribers, but I’ll be here, eager for information.
And the solution IS… - Posted by John Behle
Posted by John Behle on December 24, 1999 at 24:05:20:
As Bill and Joe mentioned. GET an agent that works for you presenting offers.
Agents are more open with other agents. They are less offended by questions about things like seller fianncing and what the seller’s motivation and or circumstances might be. Technically, they shouldn’t even talk to other agents about some of the things they do, but they do.
One way to do things is to get your own license and then go in representing another entity. Even though you need to make a disclosure of your interest, I find it far less of a problem than the other things people try.
So, even representing a Corp, LLC, partnership, trust, family member, etc. I can still bring all my knowledge and negotiation skills into the picture and create a good deal. They don’t automatically run away or “zip their lips” due to my relationship with the buyer.
The other factor is I do deals that make sense on listed properties. A large percentage of the “nothing down” deals are not suited to listed properties. Personally, if I had to choose listed properties or FSBO’s, I would choose the listed properties - no question - absolutely.
Re: Tell Them What They Want to Hear - Posted by Rob FL
Posted by Rob FL on December 23, 1999 at 22:08:56:
2 questions for you.
I am a broker, and most of the agents I deal with do not like the idea of you being with them to present the offer. I know they would have to obey the offer, but they will always make up an excuse: “The seller is difficult to get a hold of,” “The seller is only available via telephone or fax,” “The seller lives in Minnesota,” etc. (I have tried this before as you can tell.) How would you deal with those excuses? I know you can tell the agent to stick a sock in it, but doing so will put you on the bad side with the agent and he will bad mouth you to the seller and everyone else.
How can you offer to pay the seller’s agent a commission/fee to cooperate with you? He represents the seller and not you. That seems like a huge conflict of interests IMHO.
Your thoughts are much appreciated.
Re: Those @#%& Realtors!!! - Posted by Ernest
Posted by Ernest on December 24, 1999 at 09:26:57:
Yes, those realtors. I just closed my first purchase ever and it wasn’t exactly “creative” – a 100% VA loan. But the realtors even made THAT difficult for me. I made three offers of which the VA loan was only the last option. I realize now how the realtors maneuvered the sale such that other offers (that would lave benefitted both me and the seller, but not the realtors) never saw the light of day.
Fortunately, I got lucky. I had a lender that helped me out. He insisted the seller make changes increase safety and help the case flow. Both he and I want to make a loan that will pay off, of course. He required new leases with full occupancy in order to make the loan. Since the realtors and the seller saw that I wouldn’t get a loan, unless they cooperated, this was done. The result is I have a property with better cash flow and better safety for me at least for a while than I would have had without my lender’s insistence.
I’m gonna remember that lender. If I can’t get realtors to help me, I can come in behind me with a good lender.
I am willing to believe there is a “good realtors” out there for me, and will look for him or her. I have two prospects; at least they’ve made good first impressions with me, and I’ll follow up for sure. I know two realtors I won’t be working with in the future; they’ve lost my business.
It’s in the mail… - Posted by SusanL.–FL
Posted by SusanL.–FL on December 29, 1999 at 08:00:00:
…and as I mentioned in my note, I also enclosed a copy of the Table of Contents. If you see anything else that you’d like copied, let me know.
Re: What do agents know? - Posted by chris
Posted by chris on December 25, 1999 at 02:10:40:
I called an agent about a house they had their sign up for. I got the info I needed about the property such as bedrooms, square feet, etc. When it came to how much the existing mortgage(s) was on the property the agent said they did not know. Isn’t this one of the things an agent would know? I mean if the prop is not worth a certain amount over the liens there is not going to be anything left for commission. I assumed that the agent was just lazy. The agent was curious why knowing the mortgage amount was important to me. I stated that I was looking for properties that had a certain L/V ratio, etc. Then the agent said that is not a big deal-she was also a mortgage broker and could get me whatever money was needed.
I skipped this agent and I was going to drop a letter in the seller’s mail box about how lame their agent was, but I decided against it. This will probably become apparent when their house does not sell.
What info are agents required to collect on the properties they will market and pass on to prospective buyers? Secondly, is there anything unethical about a seller’s agent also doing work on the side as a mortgage broker to finance buyers?
-Thanks for the help, Chris
Re: Tell Them What They Want to Hear - Posted by PeteH(NYC)
Posted by PeteH(NYC) on December 24, 1999 at 24:23:02:
Your point is well taken: a broker could continue to be uncooperative even in the face of a written offer; nevertheless, they are required by law to present them, and if the written offer reserves the buyer’s right to be present, a buyer would have reasonable grounds to lodge a formal complaint with the local board if the broker steadfastly refused. (I suspect that’s why you refer to non-specific methods of off-putting.) That said, a broker who is already that uncooperative is probably not somebody you’re going to work well with. I’ve had brokers in my area welcome the opportunity to have me explain to a seller an offer (L/O, etc.) that they themselves don’t completely follow the structure of. How would I deal with vague stonewalling? With calm persistence: “this is my offer, the seller wants to sell, and I’m happy to help clear up any confusion or explain the trickier parts of what I realize is a non-standard offer,” blah blah blah blah blah until somebody wears down.
The fee I suggest offering is not a straight “hey-if-you-play-ball-I’ll-make-it-worth-your-while,” it’s a recognition that in a nonstandard offer (L/O, seller subordinating paper to a new first, subject-to, etc.), there may not be funds left over for the broker’s piece – so the buyer (who’s trying to get in for as little cash down as possible) might find it reasonable and worthwhile to pay, on the seller’s behalf, the commission the seller is responsible for, a la sellers sometimes helping shaky buyers out with some portion of closing costs.
Not trying to reinvent the wheel, just recognizing that a spoonful of sugar helps the medicine etc.