How to Make a Perfect Real Estate Offer Over the Competition

When you meet with a homeowner, and you will have to do this to get the best deals, you will find that the most motivated ones have contacted every "Cash for Houses" advertiser on the internet and from local bandit signs. This means that the homeowner may have already come in contact with "professional buyers" who have purchased houses many more times than you have, so you need an edge.

For you, the most important things you need to know about the property is how much can you afford to pay and still make a profit, and how much can you sell it for.

The first questions is 'How much can you afford to pay?' You have to make a profit but you have to have a reasonable offer to beat out the competition, so this seems like a dilemma. It's not a problem if you can first accurately and quickly calculate the repair costs. You may be thinking "Why do I have to know repair costs when I am wholesaling?"

If you want to make 2 to 6 times the profit margins that the average wholesaler makes, you have to know what the property will really sell for and that you can accurately estimate the repair costs for the buyer. If the buyer is another wholesaler, should you have to bother?

A huge problem with wholesalers' lists is when they estimate repairs at $5,000 to $15,000 and then proceed to tell you that the property needs a full rehab. They lose credibility and sales. Wouldn't it be better to advertise a DIY and a Contractor's bid that you generated in a few minutes! When newbie buyers see your ads and realize that you know what you are talking about, they will start to buy from you and become repeat buyers quickly. Your reputation is based on your word and your knowledge.

The "Deal or No Deal" Software was designed to eliminate the previously major issue of estimating repair costs. You can review what it does at www.ExcelRESoftware.com.  By using this inexpensive software tool you can overcome the issue of repair costs.

Next you have to determine the offer to make the seller because your profit is based on what you can buy it for, how much are the repairs, and how much you can sell it for. Right?

Actually, this isn't correct. The carrying and closing costs that aren't figured in by your competition can be significant and these expenses are where many newbies fail dismally. Your pro-competition overlooks this obstacle by offering the seller 55% to 65% of ARV (After Repaired Value).

Your advantage is gained by learning what percentage they are offering and in flat-to-fair markets this percentage will be 60%. If the property is in good to great shape (move-in), the offer will be 65%. In a bad or declining market with diminishing sales, the offer will be 50% or lower if the property is in bad shape.

These pro-wholesalers generally offer less than the land value for a burned house. There is huge profit potential in burned-out houses because of additional sources of income they have that is not understood by most investors. Every community has a small group of contractors that specialize in rehabbing these properties. By finding them and having a ready made Buyers' List, you can access the damage using the "Deal or No Deal" Software, and make an offer to the seller that beats everyone else (they will think you are crazy) and flip the property without ever going inside.

Another way to find out what they are offering is to ask the homeowner. They generally are so disgusted by the low-ball offer they will tell you. If they tell you something that sounds like more than you would pay, you say "That's a great offer, take it!" Be very polite and insist they take the offer and then tell them to please call you if it doesn't work out. About 30% of the time they will call back, and if they don't, go on to the next deal because the buyer offered too much!

As a shameless plug, the "Deal or No Deal" Software takes care of calculating what price to offer for Cash and for Terms and gives you each offer's profit expectation. The presentation you will make to the seller will be printed from the software, and with a little experience, you can take the seller's info over the phone and take a repair estimate with you without seeing the property beforehand.

change your life mentoring click button j 300x236 1The final part of the equation that is critical is the ARV segment of market value of the property. This calculation was very simple two years ago, just get comparable sales or an appraisal and ask 5% – 10% more and the property sold in one weekend. Times have changed and I use a technique of determining "What Can I Sell it For?" that I turned into a separate part of the software bundle. This method of determining market value is only used by the most professional investors who know what they are doing.

Using what I have just disclosed to you, you can determine what your competition is offering, what you can afford to offer to make a profit either fixing or flipping the property, so all you need to do is take your printed presentation and close the sale.

To your limitless success,

Dave Dinkel
Real Estate Mentor Program Founder

Visit davedinkel.com for full privacy policy, terms of use, etc.  Be sure to contact us through the website at davedinkel.com if you have questions or concerns ([email protected]).  Results mentioned in this presentation and any video, article, and/or material related to Dave Dinkel and his associated businesses are not typical nor are a guarantee of any earning potential.  No advice is to be construed as legal, accounting, or professional advice EVER.  Please consult related licensed and qualified professionals before taking any action.  No person(s) mentioned in the articles and /or shown on videos received compensation in any form for their opinions.

How to Make a Perfect Real Estate Offer Over the Competition

When you meet with a homeowner, and you will have to do this to get the best deals, you will find that the most motivated ones have contacted every "Cash for Houses" advertiser on the internet and from local bandit signs. This means that the homeowner may have already come in contact with "professional buyers" who have purchased houses many more times than you have, so you need an edge.

For you, the most important things you need to know about the property is how much can you afford to pay and still make a profit, and how much can you sell it for.

The first questions is 'How much can you afford to pay?' You have to make a profit but you have to have a reasonable offer to beat out the competition, so this seems like a dilemma. It's not a problem if you can first accurately and quickly calculate the repair costs. You may be thinking "Why do I have to know repair costs when I am wholesaling?"

If you want to make 2 to 6 times the profit margins that the average wholesaler makes, you have to know what the property will really sell for and that you can accurately estimate the repair costs for the buyer. If the buyer is another wholesaler, should you have to bother?

A huge problem with wholesalers' lists is when they estimate repairs at $5,000 to $15,000 and then proceed to tell you that the property needs a full rehab. They lose credibility and sales. Wouldn't it be better to advertise a DIY and a Contractor's bid that you generated in a few minutes! When newbie buyers see your ads and realize that you know what you are talking about, they will start to buy from you and become repeat buyers quickly. Your reputation is based on your word and your knowledge.

The "Deal or No Deal" Software was designed to eliminate the previously major issue of estimating repair costs. You can review what it does at www.ExcelRESoftware.com.  By using this inexpensive software tool you can overcome the issue of repair costs.

Next you have to determine the offer to make the seller because your profit is based on what you can buy it for, how much are the repairs, and how much you can sell it for. Right?

Actually, this isn't correct. The carrying and closing costs that aren't figured in by your competition can be significant and these expenses are where many newbies fail dismally. Your pro-competition overlooks this obstacle by offering the seller 55% to 65% of ARV (After Repaired Value).

Your advantage is gained by learning what percentage they are offering and in flat-to-fair markets this percentage will be 60%. If the property is in good to great shape (move-in), the offer will be 65%. In a bad or declining market with diminishing sales, the offer will be 50% or lower if the property is in bad shape.

These pro-wholesalers generally offer less than the land value for a burned house. There is huge profit potential in burned-out houses because of additional sources of income they have that is not understood by most investors. Every community has a small group of contractors that specialize in rehabbing these properties. By finding them and having a ready made Buyers' List, you can access the damage using the "Deal or No Deal" Software, and make an offer to the seller that beats everyone else (they will think you are crazy) and flip the property without ever going inside.

Another way to find out what they are offering is to ask the homeowner. They generally are so disgusted by the low-ball offer they will tell you. If they tell you something that sounds like more than you would pay, you say "That's a great offer, take it!" Be very polite and insist they take the offer and then tell them to please call you if it doesn't work out. About 30% of the time they will call back, and if they don't, go on to the next deal because the buyer offered too much!

As a shameless plug, the "Deal or No Deal" Software takes care of calculating what price to offer for Cash and for Terms and gives you each offer's profit expectation. The presentation you will make to the seller will be printed from the software, and with a little experience, you can take the seller's info over the phone and take a repair estimate with you without seeing the property beforehand.

change your life mentoring click button j 300x236 1The final part of the equation that is critical is the ARV segment of market value of the property. This calculation was very simple two years ago, just get comparable sales or an appraisal and ask 5% – 10% more and the property sold in one weekend. Times have changed and I use a technique of determining "What Can I Sell it For?" that I turned into a separate part of the software bundle. This method of determining market value is only used by the most professional investors who know what they are doing.

Using what I have just disclosed to you, you can determine what your competition is offering, what you can afford to offer to make a profit either fixing or flipping the property, so all you need to do is take your printed presentation and close the sale.

To your limitless success,

Dave Dinkel
Real Estate Mentor Program Founder

Frequently Asked Questions

1. What Should I Do If a Seller Ghosts Me?

If you feel you have been ghosted, act decisively and quickly. If you have tried texting and calling, it's time to drive by the seller's location. I always take the recorded Notice of Interest or Memorandum of Contract to leave, so the seller knows it exists. Go by at a time when you know they will be there and don't be confrontational, just get the facts.

In our experience with new investors, the chances of losing a deal with no contract is likely over 85%. Verbal commitments do not apply in contract law; get everything in writing, especially contract changes.

Different 'gurus' have different opinions, but our experience is finding motivated sellers and then a buyer for your deal. Ideally, you should be finding motivated buyers from day one, so you are ready when you find a seller. Buyers are easier to find as you can see at https://davedinkel.com/products/

Prevention only comes about by thinking a Black Hat wholesaler will be coming after your deal. First, educate the seller that an unscrupulous investor may come by and illegally offer more money, have the seller sign your "Notice to Homeowner," stating that he understands he cannot accept another offer.

There is nothing illegal about changing their mind, it is called seller remorse and occurs about 25% of the time. However, if they have signed your contract, it can't be cancelled for any reason unless acceptable to the investor/buyer.

If price is an objection, you need to find out how important it is to sell fast and for cash. If the seller isn't under a time constraint, has a money issue, or has a personal dilemma, he may not agree to the price you need. Offer to help move and build it into your price before you make your offer. However, never give the seller money; only pay the moving company, and only after closing (escrow with a closing agent). If fear is the seller's issue, break it down into what the real problem is and answer their objections one at a time.

You can get to the root of motivation for a seller by asking a few questions. First, "Why are you selling?", "How soon can you close?", and Are you ready to sign an AGREEMENT today, if not, what do I have to do to make you comfortable?'. The answers to these questions will determine the truth about your seller's motivations.

The best times to involve your attorney in your deals are to have him review your contracting, review the signed contracts from the seller and end buyer, have him open escrow and start the title work, negotiate with city or counties for lien reductions or mortgage payoffs with lenders, and to close the transactions." Your attorney is not the adversary; it's the opposing party's attorney who is a deal killer, and having your attorney allows him to help overcome this obstacle.

The key to successful prospecting and bringing back deals that didn't close is to follow up until the property is transferred in the public record. Some of our deals have been where the seller came back to us months and years later because they felt comfortable with us and not the other "pushy" investors who contacted them.

Your contract's most important clauses are inspection period (as long as possible), when the EMD must be deposited if at all, your ability to access the property, any added clauses specific to the property that will protect you against seller claims later that were verbal only.

Visit davedinkel.com for full privacy policy, terms of use, etc.  Be sure to contact us through the website at davedinkel.com if you have questions or concerns ([email protected]).  Results mentioned in this presentation and any video, article, and/or material related to Dave Dinkel and his associated businesses are not typical nor are a guarantee of any earning potential.  No advice is to be construed as legal, accounting, or professional advice EVER.  Please consult related licensed and qualified professionals before taking any action.  No person(s) mentioned in the articles and /or shown on videos received compensation in any form for their opinions.