When Making Your Offer to Purchase - Don't Think for the Seller!

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There are plenty of concerns and questions about how to present an offer to an owner. As real property investors, we generally present these offers on our own rather than using real estate agents, which is why it's crucial to be able to negotiate effectively and be confident in prese

There are plenty of concerns and questions about how to present an offer to an owner. As real property investors, we generally present these offers on our own rather than using real estate agents blue world city Islamabad location, which is why it's crucial to be able to negotiate effectively and be confident in presenting.

I've written previously about the process of negotiating with sellers. However, before you make the deal, the thing you have to be aware of above all else is the highest amount you'll be able to pay for it!

In order to figure out that top number, what you need to know is:

  • the real value of the property
  • repair costs
  • your costs to hold and/or the cost to sell the property

each of which allows you to calculate the amount you can pay for it.

Once you've established the amount you can pay for the property, that's the amount you cannot go over. Therefore, when you are negotiating you can't have any reason to worry about the equity position of the seller or how much the seller owes. This number should not be allowed influence what you are offering in any way at ALL.

And, don't believe me, but it's vital to take note of all the seller has to say. It's vital to form an understanding with your client when they talk about their issues and you attempt to come up with the solution for their problem. But their concerns can't become theirs. You want to help them , absolutely but you can't allow their demands to increase the cost of your proposal. Your offer is based on the maximum amount you are willing to pay.

If it is discovered that they owe more than you're able to provide, and it often does, that is a situation that they created and that they have to manage instead of you. If you're looking to be successful, you can only make offers that your numbers translate to and that's why you should know the maximum you can offer before you begin the negotiating process.

You may be surprised the fact that many people take offers that are much less than what they are owed. They will eventually come up with a variety of ways to find the funds needed in order to purchase. Do you believe me? Talk to any attorney who handles closings and ask them how often the seller can bring cash to the table at closing. It's not unusual.

So, don't think for the seller. Do not ever "assume" you understand their situation and what they might do regarding it, or what they are prepared to do, or what they already thought they would have to do before you even showed up. Actually, when you're deciding your proposition, you shouldn't be thinking about their needs at all. Only think about your own reality the numbers you have set out in paragraph 2 above and stick with that. If it's beneficial to both of you, then you've made agreed to a deal. If it doesn't work and you're not friends, you'll break off then move to the next deal.

It is always your desire to assist the seller but usually it's not possible. Don't be emotional about your proposal; this is business. There are plenty of people out there that you could aid, so don't allow just one property keep away your business.

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