Helping you save your credit and avoid foreclosure

The professional process in sales/negotiating

By Reed M. Sawyer

Stop! Think back to the last time you visited a professional. (Doctor, lawyer, accountant, or loan officer) What did they do to help you? They first had to find out what your problems or needs were. They built up their credibility with the Professional sales process.

Here it is, in the short form:

1) Qualify: Find out if the client is qualified. When you go to a doctor's office, the first thing that they do is to have you fill out forms (to determine your ability to pay). Then the doctor sits with you and asks closed ended questions. Such as, "Do you have any history of heart disease? (Yes/No).

The reason that they do this is to determine if, not only if you can pay, but also if they are the professional that you need to be seeing. I once went to an eye doctor with an eye infection. The eye doctor took one look at me and told me that my allergies had led to the eye infection and I needed to see a general practitioner. In other words, he qualified me to find out if he could help me, or if I needed to actually see someone else.

I have taken mortgage appointments with a large number of people. I don't write loans for everybody. Sometimes, I tell the people that what is in their best interest is NOT to refinance. I tell people that I don't want to take money out of my pocket, but that my goal is to do what is best for them. When I explain that I am acting in their best interests, their whole perception towards me changes. I am not a salesman. I am a professional.

The first step is to determine if they can qualify as a client. The next step is to determine if you can help them.

In real estate you do that by asking qualifying questions. We start out with open ended questions to gather a lot of information.  We then clarify by asking closed ended questions to find out the exact problem. Here is a list of some of the questions.

OPEN ENDED QUESTIONS TO GATHER INFORMATION:
a)  Tell me about your situation?
b)  How do you feel about that?
c)  Where do you see yourself going from here?
d)  What do you see happening next?
e)  What is your game plan from this point on?

CLOSED ENDED QUESTIONS TO CLARIFY:

a) Do you own the home?
b) Do you need to move?
c) How long have you owned the home?
d) What is your mortgage balance?
e) If you had to guess, what would you guess the property is worth?
f) What is the address?
g) What # of bedrooms/bathrooms?
h) Square footage?
i) One story? Or two?
j) If a basement, is it a walk-out basement?
k) Garage? Two car?
l) How old is the roof?
m) How old is the house?
n) How large is the lot?

Once I have done that I will

2) Do a needs analysis. A doctor calls this an examination. If a doctor brought you into the office and, without examining you, told you that he was going to cut off your arm, you would run out of his office screaming "quack"  (If, after doing a complete diagnosis, he determined that you had gangrene and the only choice of saving your life was to cut off your arm...you would think differently of him.)

The same rules apply to you as a professional real estate investor. You have to build your credibility by asking the open ended questions to determine the seller's motivation, their situation, and their circumstance.

One of the first questions that my mentor used to ask was, "Can you tell me a little bit about your situation?" He called it "intense listening". As the client put forth their situation, he would direct the conversation in a series of open ended questions.

Here are some open ended questions that you want to ask:

a) Share with me a little bit about your situation….

b) Can you tell me a little bit about what you want to do?

c) How do you feel about this move?

d) If you could have the perfect scenario, what would you want to do here?

e) If you could do anything, and knew that you wouldn't fail, what would it be here?

Another thing you want to do here is to determine, first broadly, then in a narrowing fashion, exactly what their needs are, and when they need something to happen.

As you listen, look for indications that what they are saying is important to them. If they become animated in regard to one of your questions, go deeper and probe. If their eyes glaze over, they are not really interested in that aspect.

Think of the needs analysis process as a funnel. The top of the funnel is very wide. As you go through the needs analysis process, you will eliminate those that aren't motivated, or aren't flexible, or don't have the capacity to sell at a reasonable price. Your job in this process is to quickly eliminate those that aren't motivated, flexible, or have the circumstances to sell at a good price. You don't have to throw their name away, simply put them into your day-timer and call them back in a month.

If you do the needs analysis well, you will spend the majority of your time in this section. If you try to rush to the close, you will have a very limited success rate.

3) Presentation: In the presentation you are going to be doing a summary of the problem, and giving a solution. In the doctor analogy, it is the diagnosis. "According to my examination, and after receiving the results of the tests from the lab, it appears that you have …." In real estate you would want to state; "According to our discussion and after having done due diligence to determine the value of the property in the market, it would appear that…."

Here is where you are going to do the needs benefit analysis. You are going to match up their needs, with your benefits. Let's do an example.

Needs:

a) Not have payments show up on Debt to Income ratio on credit report.

b) Not have to make payments.

c) Not have to worry about maintenance of property.

d) Not have to worry about credit.

e) Since there is no equity, not truly concerned with cash.

Since there is no equity, it appears that the best solution for them would be to do a lease option. Here is how we would present it to them. We are going to match up their highest priority needs, with our highest value benefits.

Our benefits are:

1) We will make payments.

2) We will take care of the maintenance.

3) We will make the payments, so their credit will improve over time.

We match up their highest need with our highest priority:

A and B match up with 1) they don't have to worry about the payments, or about their debt to income because we (tenant buyer) will be making payments.

C) Will match up with 2) we will take care of the maintenance.

d) Will match up with 3) since the payments will be made in a timely manner, credit will improve.

Since e) cash, is really not a high concern, we will not address it. We will simply address our strongest benefits.

Dear Seller,

In our conversation, you stated that the things that were most important to you were:

You have just found out their concerns, and solved their problems.

4) Price: In a doctor's office, the price section is handled by the receptionists. It is so far into the process that the benefits of health far outweigh the costs. Doctors are smart. You want to have the price be so far into the process that the benefits outweigh the offer that you are making. People are looking for a professional to lead them by the hand and solve their problems. If you follow the professional approach, they will gladly accept your price.

5) Close: In a doctor's office, the close is usually so routine that you don't even think about it. "Why don't we schedule your heart surgery (that is going to cost $100,000, although they didn't really stress that here,) for next Tuesday?" In real estate, you want to have the close be already agreed to before you get there by having followed the professional process approach. By the time you get to the close, the sellers have more interest than you do in solving their problem. "If you would like to move forward on this, for all of the obvious reasons, let's start by just putting some thoughts on paper…What's your full name?" (And start filling out the agreement. An agreement is much less intimidating than a contract.)

In the traditional sale, the close is a high powered, nerve wracking test of wills where the high pressure salesman power closes a customer, not a client, by forcing their will upon them. Sales manuals are filled with examples of closing techniques to distract, mislead, and overpower the customer.

Using the professional sales approach will create a collaborative atmosphere, rather than an adversarial atmosphere. You will have created an atmosphere where you have created ultimate professional credibility (If you act professional and follow the professional approach, you MUST be a professional, right?) The client will willingly allow you to lead them to a mutually beneficial solution to their problem.

Let's briefly discuss the difference between a client and a customer. Jay Abraham, the marketing guru and author of "How to get Everything you can out of All you've got" describes it like this. "A customer is somebody that you sell things to. A client is someone under your protection."

If you treat your seller like a customer, you will be taking yourself out of the professional process. If you treat them like a client, they will follow you anywhere.

For more information on the professional process in sales, and to schedule a free-no obligation review of your situation, please contact Reed Sawyer at:
 (407) 962-7364 or email me at reed@reedsawyer.com