There are many challenges in running a successful real estate business, but there are also plenty of opportunities to turn deals into income. The key, though, is to take advantage of the opportunities and avoid falling into certain common pitfalls that can hurt your chances of success. We’ve all experienced losses in our businesses throughout the years, but we pick ourselves up and learn from them so we don’t repeat the mistakes again.
In this episode, Brent Daniels discusses the common pitfalls people face when trying to close a deal in real estate, and how you can overcome them for increased success in your business.
5 Closing Pitfalls to Avoid in Order to Do More Deals and Make More Money in Your Real Estate Business
Let’s talk about some of the pitfalls that we face when we’re trying to close. This happens time and time again, and because we can recognize them, when you can diagnose something, you can cure it. Isn’t that fantastic? Let’s look at these pitfalls. I see it time and time again. There are closing pitfalls. Number one is missing the decision window. These aren’t in rank or order. This is what I see after coaching thousands of people around the country, getting 80 to 100 text messages every single day, and working on this with my one-on-one coaching students.
Missing the decision window is huge. What I’m saying is you’re not following up enough. They told you, “I’m not going to sell this for six months.” You don’t call them for three and they sold it two weeks after you talked to them. It’s staying in front of these people. What does lead follow-up come down to? Eighty percent of the time, it comes down to a text message and a voicemail. Eighty percent of the time, they don’t even pick up. It’s planting seeds and keeping you top of mind. Make sure that you are aggressive with your lead follow-up.
Get Out Of Bed
Number two, you get outbid. There are people that have more money. There are that are willing to offer more or make less on the deal. There are people that are willing to do whatever it takes to get that deal, even if it makes it a super thin deal or takes them out of doing a wholesale deal on this and makes them do a fix and flip and buy this as a rental because they want to win this deal. You are going to get outbid. If you have a servant’s heart and understand what’s best for that homeowner and if they can get more and it goes smoothly, they can get more and let it go smoothly. It’s part of the business.
Lack Of Pre-Qualifying
The point is to add so many new leads in from lead generation that losing 1, 2, or 3 deals here or there doesn’t matter. Getting outbid doesn’t matter because you’ve got enough in your pipeline to hit your financial goals. Number three, lack of pre-qualifying. This is number one when people are starting in this business. It’s the lack of getting the condition, timeline, motivation, and price, “I don’t want to get all those things, Brent. They might tell me that they don’t want to do business or they want too much for it. I want to get face-to-face with them and get the experience.”
When you can recognize and you can diagnose something, you can cure it.
I get it. That’s okay. A lot of that is you hiding. Let’s be honest. A lot of that is feeling like you’re building momentum in your business by going on appointments. If they’re not qualified, then the likelihood of them signing an agreement, something that is binding to them and binding to you, is very low if you have not pre-qualified. You’re going to find out that they want too much, they’re not motivated, they don’t have a problem, and the properties are way better conditioned than a discounted property would go for. It’s the lack of pre-qualifying and certainty.
That’s that posture, knowing, clarity, discipline, and certainty that you can solve their problem. The first 1 year or 18 months, I was like, “I don’t know. I hope that I can get this done. I know that I can do a good job and that I’m going to put all my efforts behind it, but with that little nagging thing about certainty now, I can close every single deal. It’s not even close.” The certainty is bananas. It’s too much. It’s overflowing. It overflows to the team and the whole organization. It’s that certainty that comes that you can go in there and do the best for that property owner.
Lack Of Likeability
The lack of likeability, this I see all the time. People are arguing with property owners. If you want to build friction in a relationship, tell them they’re wrong and their price of $250,000 is bananas. Go ahead and see how that lands. You confirm and approve as you’re speaking with these property owners. They say, “I understand. That makes sense. How did you get that? Talk to me a little bit more about that. What do you feel? What is your goal?” All of these things are important so that you can build a good relationship there because they might tell you a price that they’re throwing out.
They don’t know, you give them their price, and they’re willing to do it. That happens all the time. If you tell them that they’re wrong all the time, “This is going to cost $100,000 in repairs, not $15,000,” and you start building that type of thing up, it’s going to disintegrate that relationship and you’re not going to be able to get that deal. Sometimes you’re going to be out-relationship-ed. Let’s be honest. Sometimes a female seller wants to work with a female buyer. Sometimes the guy that’s selling the property is a former Marine.
Somebody that owns a wholesaling company buying is also a Marine. They build instant rapport and you’re off the table. It’s going to happen. Sometimes you are going to out-relationship a lot of people because you’re going to understand how to communicate effectively. I’m going to put you in the best position, but sometimes it doesn’t matter. Sometimes they have family that is going to get in there and work the deal. Sometimes they’re going to have some referral or something going on that they already have a relationship and they think it’s easier to go that way.
Go there for a purpose. Get the upfront agreement. Don’t just passively let this go by.
You’re going to get out-relationship-ed. The last one is upfront agreements. This is huge. If I say, “When I come over to the house and if we agree to the terms and the price and everything looks good to you, are you willing to sign the agreement when I come out today at noon?” It’s these upfront agreements, “Is everybody going to be there to make the decision?” These are the pitfalls. What we do is go, “I’ll see you at 4:00. Text me if anything is coming up or whatever is going on.” Get the upfront agreement. You’re going there for a purpose.
Don’t passively let this go by and hope that they’re ready to make a decision when you show up. You need to know if they’re ready to make a decision. If they’re not, that’s great. At least you know what you’re up against and what you need to talk about, “I’m not sure. I might want more for the house than I thought I did.” “What happened? You said that $125,000 was what you needed for the property. Are you increasing your price? Talk to me about that.” “I looked online, I’ve been told, and somebody else said that I shouldn’t take anything less than $180,000 and all these other things.”
“Let’s talk about that as soon as I get over there.” Bring comps showing why $125,000 is the right price for that deal. If you didn’t know that, what are you going to do? You’re going to go there and go, “I can only give you $125,000. You want $180,000. It seems like we’re too far apart. Maybe I can go $128,000 to $130,000 and it will work.” It turns awkward and all the air gets sucked out of the room. You’re like, “I can’t breathe in here. This is not going to happen.”
If you know upfront before going on that appointment, bring your purchase agreement with you because that’s the purpose of these appointments, and know all of the roadblocks, you know how to prepare better for that appointment. That’s how you get better closings. If you are interested in joining the most proactive group in real estate, it is the TTP program. Go to WholesalingInc.com/TTP, scroll down, and check out the hundreds of testimonials and what the program is about. If it feels good in your guts, then sign up for a call. I look forward to working with you personally.
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About Brent Daniels
Brent Daniels is a multi-million dollar wholesaler in Phoenix, Arizona… and the creator of “Talk To People” — a simple, low cost, and incredibly effective telephone marketing program…
Also known as “TTP”… it helps wholesalers do more, bigger, and more profitable deals by replacing traditional paid advertising (postcards, yellow letters, bandit signs, and PPC) with being proactive and taking action every single day!
Brent has personally coached over 1,000 wholesalers enrolled in his “Cold Calling Mastery” training, and helped 10,000’s of others who listen to him host the Wholesaling Inc. podcast, watch his YouTube channel, and attend his live events…
A natural leader, Brent combines his passion for helping others with his high energy, “don’t-wait-around-for-business” attitude to help you CRUSH your wholesaling goals as quickly and easily as possible!