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Go Pro, For Sale By Owner “The 7 Most Fatal Pitfalls Home Sellers Make When Putting up the „My Home Sweet Home is Up For Sale‟ Flag”


Go Pro, For Sale By Owner Inc.

ALL RIGHTS RESERVED Copyright 2011


GoProFSBO.com presents this e-course on selling a home. Every effort was made to provide accurate and complete information on selling property. However, this does not guarantee the accuracy, or completeness of any information, product, process, or determination provided by this e-course. Consult a real estate lawyer regarding laws when selling real estate. To proceed, you must accept this disclaimer.


Lesson 1: First Impressions Are the Only Impressions…………………………….…………..1 Curb Appeal……………….…………………………………………………….…………….……..………….....1 Cleaning and Painting…………………………………………………………………………….………………2 Carpets………………………………………………………………………………………………………………….2 The Three Most Important Rooms…………………………………………………………………………2 Fix It………………………………………………………………………………………………………..…………….3 De-Clutter………………………………………………………………………………………………………………3 Lighting………………………………………………………………………………………………………………….3 Major Renovations………………………………………………………………………………………………..4 Staging Our Home………………………………………………………………………………………………….4 Lesson 2: Price it Right, Right Off the Bat.………………..…………………………………..…...5 Supply and Demand…................................................................................................5 Our Current Market………………………………………………………………………………………….……6 Where to Price Our Home…………………………………………………………………….……..……..…6 Finding Our Home’s True Value……………………………………………………………….………….…8 CMAs and BPOs..........................................................................................................8 Appraisal……………………………………………………………………………….………………………………9 Knowing Our Competition……………………………………………………………………………………..9 Lesson 3: Over-Exposure is Never a Problem………………………………………….………..10 GoProFSBO.com……………………………………………………………………………………….………….10 Creating Our Template………………………………………………………………………………………..10 Photos…………………………………………………………………………………….…………………………..11 Virtual Tour………………………………………………………………………….………………………………11 Home Information……………………………………………………………….………………………………11 Extras………………………………………………………………………………………………………………..…12 Local Area…………………………………………………………………..……………………………………….12 GoProFSBO.com Campaigns…………………………………………….………………………………….12 Open House…………………………………………………………………………………………………………13 MLS Flat Fee………………………………………………………………………………………………………..15 Niche Marketing …………………………………………………………..…………………………..………..15 Title………………………………………………………………………………………………………..……………16


Lesson 4: Only Work With Able Buyers…………..……….……………………………………….18 Our Loan Director…………………………………………..……………………………………………………19 Pre-Qualifying and Pre-Approving……………………………………….………………………………19 Finance Options Flyer ………………………………………………………………………….……………..20 Lesson 5: Non-Conventional Loans, Unique Financing With Great Potential…..…21 VA Loans………………………………………………………………………………………….………………….21 USDA Loans……………………………………………………………………………….…………………………22 FHA Loans………………………………………………………………………………………..………………….22 Seller Concessions……………………………………………………………………………….………………23 Seller Financing……………………………………………………………………………………………………23 Lease to Purchase………………………………………………………………………………………………..24 Benefits of Lease to Purchase………………………………………………………………………..…….25 Lesson 6: Sales are not About a Product, They’re About Emotions…………………...27 Sales Are About Emotions, Not Logic………………………………………….……………..………..27 11 Primary Emotional Needs of Buyers………………………………………………………………..27 Lesson 7: Everything is Negotiable.……………………………………………………….………….29 #1 Reason Why a Sale Fails During Negotiations…………………………………….……………30 Using Our Appraisal for Maximum Leverage………………………………………………………..30 Offers and Counter-Offers……………………………………………………………………………………31 Tradables…………………………………………………………………………………..………………………..32


Introduction Welcome! We wrote this e-course with the intention to give everyone who reads it the proper opportunity to sell their home quicker, for the best price possible, without having to give any of their hard earned equity away. We believe that home owners shouldn’t have to be made to give away their hard earned equity. It is that simple! In the past, listing with a real estate professional was the only real choice, but with the technology and tools we have access to day, we simply don’t have to. Through the best research and years of experience, we have whittled down the art of selling a home to 7 fundamental principles and present them here, for any person to understand. They are simple and true. If one follows this e-course as a guideline, we are confident they can successfully sell their home! Every principle and claim of advice embodied in this e-course has been thoroughly tested in the laboratory of practical real estate business, where it has been tried and found to be sound. The purpose of this introduction is to lay before you a quick overview of what this e-course essentially is, and what its authors intend for it to do for you. The facts, out of which these principles have been prepared, are from more than 10 years of real estate business and mortgage experience. Power is organized energy or effort. And the combined practice or effort of all the 7 principles in this e-course will surely bring you power, the kind of power one needs to sell their home quicker, for top dollar. This e-course promises one thing, through its principles and mastery, you will be able to sell your home faster, for a better price. Without exception, those who have sold homes successfully have consciously or unconsciously sold their home through the application of the principles that this ecourse teaches. If you doubt this statement, master the 7 principles and test it yourself. I can promise you that learning these simple principles can do you only good, and they call for nothing special on your part, other than an honest attempt. This e-course is a map or a blue print to help you to be successful in the goal of selling your home. Out of all the people we have interviewed, we discovered that 96% of those who had failed to sell their home efficiently, were people who just put their home up for sell, without any plan or definite method. Without a definite plan, we are like a ship in mid ocean with no helm; it will circle round and around, quickly exhausting its fuel supply without reaching its destination, no matter that it would use up enough energy to reach it, maybe several times. When we try to sell our home without definite plans, we resemble that ship without a helm. Hard labor and good intentions are just that, but that is not enough to get your home sold. A bundle of batteries, wired in concert can successfully run a good sized piece of machinery, but individually, not one of those batteries could turn the motor once! This can be likened to the 7 principles in this e-course. Together, they can successfully sell our home, but any one principle alone, isn’t near sufficient enough. The organized effort of all the principles this e-course has to offer is what will give you enough power to arrive at your goal, which is of course selling your home quickly, for the best price possible!


We are convinced that anyone well educated in this e-course can do a great job at selling their home. Knowledge leads to self confidence and happy is s/he who can rip down that veil of fear, and let in the light of confidence that they can sell their home in any market. During this e-course, you will notice that the 7 principles are so well harmonized, so interwoven, that they often overlap and blend with each other. It will be well noted that successful home sellers make use of all the factors covered in this e-course. The real value of this e-course is in the use and intensity that you make of it, not simply the knowledge that you gain. The effort has to be on your part or these are just empty words. Go at selling your home with attention, focus, and energy. The better prepared you are, the better you will do. Plan your work, and then work your plan. You will fare better than anyone else trying to sell their home if you implement all the fundamental principles that you will learn here. Good luck and happy home selling!


LESSON ONE ~First Impressions Are the Only~ Impressions Everything has got to shine! We need to get our home ready for showings. Start by throwing emotion out the door. This is a business transaction and the more objective we are in the process, the better we will fare.

Curb appeal Let’s drive up to our home slowly, as if we have never been there before. What are our very first impressions? What grabs our attention? Is it the bright colors of our flowers and lawn, or is it the worn out mailbox? Take note of all the attractive features, as well as anything that could be a potential turnoff. Be honest, if we don’t think we can do this objectively; ask a friend or family member to help us in the process. Their honesty may sting and if it does, be thankful, not defensive. Look at our home from the street; this is called curb appeal. Does the lawn need to be trimmed, edged, fertilized, or need to have patches replaced with new sod? Do the sprinklers need work? Are bushes over grown, blocking windows, or do we need to plant a couple new ones? Does the porch need a couple flower pots? Do the sidewalks and driveway need to be shoveled? Does the outside of the house, driveway, or garage floor need to be pressure washed? Are the gutters on the roof clean and clear? Do the shutters, front door, or trim need to be painted? Does the garage door need to be replaced? Does the fence need to be mended, painted or replaced? Curb appeal, after internet photos and video tour, is one of the most important aspects of presenting our home. The number one thing potential buyers do after they decide our home is a possibility on the 1


internet, is to do a drive by. And let us understand, if the curb appeal isn’t what they had hoped, they may pass right on by, without stepping a foot outside their car, no matter how wonderful the inside of our home may look! Next, we go through the same procedure but this time while facing our front door. Look left, right, up, and down. While people are waiting for us to come to the door, they are doing an eight foot check in every direction. Make sure this area is sparkling; no cobwebs, leaves, dirt, or worn out mats in sight. Paint any portion of this area if needed. A new front door handle will do wonders to the mind of a critical buyer.

Cleaning and Painting Now, let’s enter the home. Statistics say buyers make a decision whether or not to buy a home within the first 10 seconds of entering it. What will they see; clutter, dirty carpets, scuffed walls, kids’ toys strewn everywhere? Clean the home from top to bottom, left to right. Make the home gleam. The biggest profit margin, when selling our home in regards to cost, hands down is CLEANING! Next would be painting. We definitely recommend painting! Put a fresh coat of paint on those walls and kitchen cabinet doors. It doesn’t cost a lot and does wonders for the feel, look, and marketability of our home. Important note; use neutral colors! We want our home to be a fresh canvas, where potential buyers can envision their life upon.

Carpets Shampoo all the carpets. If this doesn’t make them look new, replace them, especially if we have pet odor! This is where our friend’s honest opinion can really help. So often, we don’t notice the smell our pets leave behind. The return on investment for fresh carpet is well worth the effort and price, if needed. Get medium grade carpet and don’t replace the padding if it isn’t worn out, and again neutral colors! If we have old or dirty rugs, get rid of them. Polish all wood in our home, especially flooring, and if flooring is damaged, repair or replace it.

The Three Most Important Rooms The three most important rooms in our home are the master bedroom, the kitchen, and the bathrooms. These rooms need to be paid special attention. The bedroom should look and feel fresh, warm, and inviting. The kitchen and bathroom should be cleaned and repaired meticulously. Make sure that no grout or tiles are missing, or dirty. Caulking is very inexpensive and can freshen up a bathroom immensely. No stains on porcelain or appliances, inside or out. There are miracle cleaning products at our local hardware store that can really make these rooms sparkle. It probably is a great idea to change those old toilet seats. These three rooms can make the difference in a sell or a flop. If we are going to spend money, better on these three rooms. And don’t forget the backyard; make it stand out like the front.

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Fix It Remember that broken shower handle that we have been meaning to fix for the past three months or even a year, but just haven’t gotten around to it? Fix it, and go around and fix anyone of those little defects that have become just another part of our home. We may have gotten used to that hole on the bathroom wall, or door knob missing from the laundry room, but these are red flags to potential buyers. Red flags that say there are other problems that may be hiding. The mind of a buyer is looking for flaws, don’t let them find any!

De-Clutter Next, we de-clutter. This is another hard one in regards to being objective, but is essential. All those beautiful pictures of our family, all those trophies and titles hanging on the wall, we need to box them up and depersonalize our home. Why?... because it’s hard for people to envision themselves living in a home that already has other faces and memories plastered all over it. We need to help potential buyers imagine themselves living in our home, and help create an emotional connection. We may not realize it, but our home is a lot more cluttered than we think. The general rule is to leave about one third of furnishings in our home. Also, the basement, attic, garage, and storage areas; we need to de-clutter, clear, and clean as if they were living areas. Closets need to be treated the same way. Make closet content sparse. Again, about a third of its contents should be left inside, and well organized. Linen closets, believe it or not, are an icon. If the linen closet is a mess, buyers assume that things behind the wall, like the plumbing and electricity, are also a mess. The kitchen and bathroom counter tops….. All magazines, appliances, and other nic nacs need to be cleared. Don’t forget about drawers, de-clutter them as well. If our drawers are packed and cluttered, we give the buyer the impression that our home is cramped and will not be big enough for their needs either. All those magnets and art work on the fridge…. gotta go. Now, what do we do with the items we have removed? We can do one of a couple things with these items. Box them up and take them to a storage unit.This will give us a huge head start on packing. Or, we can hold a yard sale and actually start marketing our home by passing out our “Choose Your Next Door Neighbor” flyer, which we will be available through GoProFSBO.com.

Lighting Clean all the windows, inside and out, as well as mirrors. Make them shine. And those dingy curtains, take them off and pack them up, or throw them away. In most states we don’t need to worry about putting new ones up. If we don’t show our home with them, we don’t have to leave any. Check our specific state’s rules. Remember to clean and open those blinds, the more light we let into our home, the more spacious it looks and feels. Make sure bushes and shrubs outside are not stealing light. Just think, light is money! Now take those light fixtures, clean them brilliantly and replace the bulbs with 100 watt bulbs. We may want to buy some lamps to brighten the home up. On that note, think about buying a couple exterior lights for the outside. Will not cost a lot, and does wonders, especially if potential buyers drive by at night. We want everything to look great! 3


Major Renovations We may be concerned with renovations…. Don’t do major renovations! We most likely will not recoup the cost. The very best things we can do to our home are; fix existing problems, clean what we have, and make our home as appealing as possible.

Staging Our Home Staging our home is a vital part of presenting it. Act as if our potential buyers are an audience, and we are the producing a play. It is our job to set the stage in the very way we want our home to be portrayed. Whatever we want the buyer to see, we need to be dramatic. People have a hard time imagining things on their own. The purpose of every room should be perfectly clear when they walk into it. Example: If we have a fireplace, put a rocking chair in front of it with a blanket draped over it with a novel on top of the side table. Paint the picture that we want buyer to see. We get to portray, in the eyes of each and every potential buyer, anything that we want them to imagine by the way we stage each room. When we stage, we don’t have to buy a lot of things to do the trick, but we do need to be creative. We can stage our home by simply removing furniture, rearranging furniture, renting a few pieces of furniture, and buying small items such as; soaps, towels, candles and flowers. Be creative and convey exactly what we want buyers to see.

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LESSON TWO ~Price it Right, Right off the Bat~ A special note to us sellers who may owe more than our home’s respective market value; don’t fear, there is a solution for us and it will be covered in depth in lesson five. Even if we owe more than our home’s current market value, we can successfully sell our home for top dollar and move on with our lives, with money in our pocket. Just hang in there and continue with the e-course. The single most important factor to consider when selling our home is figuring the right price; how much can we sell our home for today? It is extremely important that we stay unemotional. The sentimental value we so dearly place on our home has no bearing on its real value in the market place. Also, our home is worth what someone is willing to pay for it today or in the pursuing month, not what it would have sold for a year ago, not six months ago, not 90 days ago, not a month ago, and not even yesterday. Many people want to look back and say, “But Bill and Mary’s home sold for X amount of dollars last year and our home is nicer than theirs”. It doesn’t work like that. We need to find the market value of our home today. And we need to come to terms with this fact before we continue. How exactly do we find the correct value of our home, one that will help us sell fast, at the best price? We are going to apply a few techniques to price our home correctly. We want to insure that the price tag we put on it is reasonable, gets our home sold quickest, and one that will maximize the final sale price. We are going to learn strategies that will aid us in getting our home sold faster, for a price higher than we ask.

Supply and Demand First, let’s understand a simple economic principle. Price, boiled down to its raw form, is based upon supply and demand. If there is a large demand for a certain product and there is not a lot of that product, price goes up. The supplier of said product can inflate the price of product because it is in scarcity. When a product is in scarcity, with high demand, price inflation pursues. Buyers, themselves, escalate the price of product through competition. It is human nature to fight for what we want if we feel as though we are in danger of losing that which we are emotionally attached. This is important to understand when we talk about where to price our home in regards to the market. On the opposite side of this coin, if there is a large supply of a product, and a relatively small demand for that product, price goes down. There is abundance of said product, not scarcity. Now the suppliers are in competition, and product price is lowered until a buyer steps forward and volunteers to purchase. This in turn forces other suppliers to lower their price to stay in competition. This continues until another buyer steps forward and volunteers to buy and so on. 5


Our Current Market The market we currently are in is one in which there are more homes than there are buyers. This is why it is called a buyer’s market. There is a large supply of homes on the market with a relatively small amount of buyers. Sellers are in competition with each other to attract the limited pool of buyers. This is the competition in the market place. And the seller who knows what the market is doing, and has aggressive intelligence how to manipulate inside of that market, will always fare better than the person who blindly throws their home up for sale. What do we mean when we say “aggressive intelligence… inside of that market”? We will create a bubble of perception of high demand and scarcity for our home even though, this is a buyer’s market. How do we do that? The first thing we do is make our home as appealing as possible like we covered in lesson one. The second thing we do is price our property right, which we will learn how to do in this lesson. Then, we draw large interest to our home through mass marketing, which will be covered in the following lesson.

Where to Price Our Home So, where do we price our home?

Do we price our home above market in hope that that special someone comes along and sees the “true value” of our home that we see? Do we price our home in the middle of the road, so we don’t leave money on the table? Or, do we under-price our home to generate a large amount of interest to it, right away? We price our home below market value, how much depends on our competition. We want to be better priced than other homes in our area, because buyers need a boost of value priced adrenaline to get them off their couch and into our front door. Buyers will swarm around our home in a frenzy of interest if we place our home below market, creating competition for our home, which in turn will elevate the sale price to, or slightly above, market value. When we list our home above or even at market-value, we repel most buyers, and a relatively small number actually show up. Our home is just another home on the market, and in a few months our home starts to attract half serious offers that we could never possibly accept. Our home won't sell for top dollar if we list at market value or above. It will fade into the background as do so many other homes we see. On the other hand, buyers readily will come to the offering table at market price, if we advertise our home as under-valued. Let’s first get rid of a common misconception that keeps us from understanding how this approach works. Everyone assumes that only in a seller’s market homes receive multiple offers. This simply is not true. If it were, bank owned homes wouldn’t be getting multiple offers right now, but low and behold they 6


are. Multiple offers are happening right now on homes that stand out from the crowd by being priced right and showing value. Right now, multiple offers mean that buyers recognize an under-priced home and are willing to bid its sale price up to market value. The weaker the market, the more buyers need to see value to notice our home. We're fighting with buyer fears as well as a large stock of homes. We need to give buyers a reason to come look at our home instead of, or at least along with, others in our area. Once buyers have seen our home, they will get excited. And once buyers have seen their competition, not all, but enough will be willing to pay fair market value for our home. We need to get buyers in our front door! What's wrong with starting at a high price and reducing it if we don’t get offers? Reducing our price doesn’t get us back that all important momentum we need to sell for top dollar, because by then our house is becoming stale and buyers wonder what's wrong with it, that is if they're even still aware that it is for sale. This is important because it is very common to get our best offers within the first 21 days. That's why coming to the market with an eye-catching price, right away, is so imperative. We may be asking ourselves, “How will buyers know what to offer us for our home? The same way buyers know what to offer for any home. Buyers know a home's market value because buyers place market value. Buyers are price makers, and sellers, price takers. Buyers will bid our home's sale price to today's market value, whatever it is; despite how under-priced we have it. Forget “How will they know what to offer for our home?” Buyers don't need to be taught how the market works. The market doesn't need instruction to know how to act like a market. Buyers are the market, and this comes naturally. In fact, this is the only reason that the market does work. Serious buyers, not open house looky loos or window shoppers, know what today's market value is better than sellers. Under-pricing a home to get multiple offers is natural and relies on the fact that buyers will compete for that which they value. This strategy is essentially an informal auction. It is human nature to fight for something we want and feel we may lose. The logic behind under-pricing our home is based on an economic as well as a psychological standpoint. We are possessive. We will fight for anything we feel we may lose. We willingly compete with other buyers for a home, if we have emotional ties and perceive that the value of the home justifies a price. Buyers will bump up the price of a home, to market value, and sometimes a little more, depending on the perceived value they place on it. Some buyers won’t compete, some will halfheartedly compete, and some will compete until they win. This is human nature and we just need to create the correct environment for this to take place. Remember that bubble of perception, of high demand, we are going to create? This is it. We are going to create a perception of scarcity, of our home, through competition. And how do we do that? First, we prepare our home for presentation, next we under-price our home to get those buyers off their couch, and then are going to mass market our home in order to place it in front of as many eyes as we possibly can. After that, we are going to invite them into our home, show them further value through “Extras” (explained, in detail, in lesson three), and let the love affair begin. We cannot force 7


this emotional bond to take place, but we can persuade it by making our home as inviting and appealing as we possibly can. Besides what we have shared already, there are other important strategies that will help us do this, and they will be presented in their proper lesson.

Finding Our Home’s True Value So, what is our home’s value? We can always start with zillow.com. This is one of the easiest ways to get a “zestimate” of our property. Good start but not accurate. We typed in our home on Zillow and half of the square footage wasn’t documented. Next, we can get an electronic AVM (Automated Valuation Model). There are a few sites that offer this for free, but again, they are generated by a database, and again half of our square footage wasn’t present. Both instances our home was well under-valued. Although free, we don’t want guesses. We want the most accurate and usable information we can possibly get. Next, we can look up property tax records, simply Google “property tax records <our county>”. Note; when searching for our home, sometimes it is better to just put the street number and city. In our local county, it won’t find our home when we include the street name. Tax values are not very accurate either, they evaluate homes loosely, and from our experience are quite off the mark. If the values from these three are not what we had expected or hoped, don’t get too upset or happy. They most likely are not accurate.

CMAs and BPOs The next option is to call local real estate professionals, asking them to do a CMA (Comparative Market Analysis) or a BPO (Broker Price Opinion). Some will be glad to do this for us in hopes that we will list with them, and some will not. Get three different companies to give us their opinion. Don’t be shy if the first one or two flat out deny our request. There are plenty that will, just call another. When calling, simply say that we are thinking about selling our home and would like to know what its value is, and if they would be able to do a CMA or BPO for us. Tell them we might be interested in putting our home on the MLS for a flat fee. (This will be better explained in lesson three).Tell them of any modifications or finished basements that might not be in county records. This way they can have all pertinent information to assess our home correctly. Take the three companies’ values into consideration. Hopefully they will all be quite close in price. This tells us that their prices are pretty accurate. If they are not close, call other companies until we have three in relative agreement. This tool is quite effective. If they are experienced real estate professionals, they will know what the market is doing in our area and will add this into their results.

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Appraisal The last and most accurate tool is to order an appraisal. This will cost money, between $300 and $425, and is well worth it. Appraisers are highly regulated and all use the same formulas and techniques when pricing a home. This is important because the lender, loaning our buyer money, will also order an appraisal. The lender strictly uses the appraised value when deciding how much to lend on our home. If the value that we have placed on our home is not in agreement with an appraisal, we may have a hard time closing the deal, or we may be unnecessarily leaving money on the table. An over-priced home will not only repel buyers, but the bank simply will not lend above the appraised price. And that will cause us a lot of unnecessary heartache. Why not get the real value, right away? An appraisal is not only a great tool to know our homeâ&#x20AC;&#x2122;s value; it also can be a very valuable negotiating tool once we have interested potential buyers. It impresses potential buyers with written proof of our homeâ&#x20AC;&#x2122;s condition, inside and out, makes us aware of problems and eliminates last-minute repair hassles that delay closing, and it can decrease the chances of unknown problems that cause sales to fall through. The value of an appraisal is more than triple the cost associated with it, considering what it helps us accomplish. Get an appraisal! We will be happy we did.

Knowing our Competition After we know the market value of our home, letâ&#x20AC;&#x2122;s do a little research of our own. Within a half mile, or so, radius of our home, find homes for sale similar to ours; square footage, bedrooms, bathrooms, floor layout. Find out how much these sellers are asking for their homes. Be attentive to the homes. What impresses us by these homes? And the homes that have been on the market for an extended amount of time; is there something about the home that turns us off, or is the square footage priced too high? Learn from other sellers, and integrate what we see, for our use, good qualities as well as things we see they are doing wrong. Now that we have the market value of our home, and we know what our competition is doing, we can aggressively price our home for the biggest interest. Remember; price our home aggressively to create aggressive interest in it. If our home is in superior condition and priced better than other homes in our area, our home will sell for top dollar, period!

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LESSON THREE ~Over-Exposure is Never a Problem~ Our purpose in marketing our home is to get it in front of as many ready buyers as we possibly can, furthermore, to get them out of their front door and into ours. So, how do we get the message out to these ready buyers that our home is for sale? Any and every way we can. Overexposure is never a problem! We want our home listing to show up every place that a buyer might look. The more strategies we implement, the more buyers will know our home is for sale, and the more buyers that know our home is for sale, the quicker and more profitable we will be. We have automated much of the marketing through GoProFSBO.com. The National Association of Realtors tells us that 90% of all home buyers either started their search or found their home online. So, our main focus is on the internet. GoProFSBO.com has a variety of features and campaigns that will enable us to market our home to thousands upon thousands of potential buyers.

GoProFSBO.com This e-course is designed not only to educate us on selling our home quicker, for top dollar, but also to prepare us for the use of GoProFSBO.com. After completing this course, we will create an attractive template that will feature our home. This template will serve as our very own personal website, which we can put at the bottom of every piece of advertisement we utilize. It will have a code associated with it that we can simply copy and paste into Craigslist.org, featuring our home as a stunning template, instead of just another boring black and white advertisement. It will be available for us to print as a “Home Information Flyer”, as well as a “Choose Your Own Next Door Neighbor Flyer”, to hand out to all prospective buyers. It will have “quick links” that will enable us to automatically post our home to our social media sites, such as Twitter and Facebook. GoProFSBO.com will give us access to our very own Mortgage Professional, on call, to pre-qualify and pre-approve our prospective buyers, so we know we are not wasting our valuable time and energy on people who couldn’t buy our home in the first place. Last and certainly not least, GoProFSBO.com will serve as a syndication platform, from which our home will be sent, automatically, to many of the top classified real estate web sites.

Creating Our Template When creating our template, it is imperative to understand how to present our information.

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Photos The right photos are vital. The difference between mediocre photos and great photos can mean the difference between someone skimming our home online and actually coming to see it. A picture, in regards to real estate, is worth more than 1000 words, so let’s make them 1000+ words of Wow! The first photo we upload should be a front view of our home. Take pictures on a sunny day when there are no shadows on the object we are featuring. Panoramic shots are the best, but more important, use the same dimensions for all our pictures. Our template will look awkward with an array of different sized pictures. Take several shots of every aspect of our home. From these photos we will be able to upload 9 of the very best, inside and out. Remember to include pictures of bathroom and kitchen. Buyers are suspicious of homes that don’t have photos of these rooms, thinking we have something to hide. Use a camera of good quality. If we don’t have one, ask a family member or friend to borrow theirs. The pictures of our home are the very first things that buyers will see. Make them extra special. First impressions are the only impressions. If they aren’t first-class, buyers probably won’t take the next step, which is to see our home in person.

Virtual Tour If a picture is worth a 1000 words, what is a video worth? A virtual tour is vital. Although, not featured on our flyers, it will be an intrinsic part of our website. The tour turns buyers on and let’s them take a peek inside, building crucial interest. Give them a great show. Use a quality camcorder and tripod. We want to show great shots of our home that aren’t shaky. If we don’t have the equipment, borrow them. If we don’t feel comfortable borrowing, we can always rent. There are plenty of companies who offer this equipment for a low price. Some will even deliver the equipment to our home. Just Google “rent digital camera <our city>”. When making our virtual tour, start on an object of interest such as the mantle or fire place and slowly turn the camera around on the tripod to stop on another object such as a window or stairway. Do this inside and out, recording all the special features that make our home desirable. Our personal website will be available for potential buyers to view 24 hours a day, 7 days a week. Make the virtual tour grab them by the collar and drag them into our front door.

Home Information Next step is to fill out our contact and home information. Price may take a few days to get. In the mean time, we can focus on preparing our “Home Description”. Create a compelling story about our home. Facts tell and stories sell. Make a list of all those special BENEFITS our home has to offer, not the features alone! Benefits sell, features do not. Here is what we mean when we say benefits and not just features; “cooling off on those hot summer days in the privacy of your own backyard pool”, or “having family and friends over for that backyard summer pool party”, versus simply stating it has a pool. Another example is “that spectacular view of 11


the mountains where you and your significant other can relax and enjoy a romantic evening on your beautiful backyard deck”, rather than saying it has a wood deck with a view. Or, that it is “so well located that you will be home, from work, snuggling with your kids, eating popcorn and watching your favorite movies, while your coworkers are stuck in traffic behind that seemingly endless line of cars”, instead of saying that it is close to downtown. What can we think of that will make our home stand out? Be creative and note all the favorable benefits associated with our home, highlight them, and create a story that pulls dramatically at emotions. Stories that create emotion will get buyers in our home. Logic is used after the fact to justify a buy. Andrew Carnegie, one the richest and most prominent economists the world has ever known stated, “When dealing with people, remember we are not dealing with creatures of logic, but creatures of emotion”. We have to capture the heart of a person and hold it before we can ever get them to do what we want. The key is to get them emotional about our home. Energy and enthusiasm are going to play a big role. If we are excited about our home, others will as well. If we are not excited, people will sense this by the way we write about, talk about, and show our home.

Extras Next, we focus on “Extras”. An “extra” is something that adds value to our home, such as financing options, which will be covered in lesson five, a home inspection, blueprints for additions, possible future improvements, and a home warranty. They all are great, but we would like to focus on a home warranty. This will create a huge amount of value and buyer confidence in our home. The cost for a warranty is between $250 and $400, and is solid as a rock when it comes to value! It instills a sense of surety in potential buyers, by knowing that the home has been checked out and is in good condition, and that they don’t need to worry three months down the road if the water heater goes out. We want to create as much value in our home as possible. These “Extras” do great service for us along these lines. Today, people are throwing whatever they can into a sale to perk interest in buyers. Personally, we would rather have assurance that we are protected from unforeseen cost more than have a plasma screen. Home warranty, phenomenal choice!

Local Area Next, we fill out “Local Area”. In this part, we let buyers know about all the conveniences that our location has to offer, such as; schools, parks, theaters, libraries, beaches, mountains, museums, and churches. Be specific, explicit, and creative.

GoProFSBO.com Campaigns Once we log into GoProFSBO.com, besides the previously described features, we will have, for our full use, a handful of exciting marketing campaigns that will increase our number of home showings, exponentially. “Exponential Email”. All we have to do is copy and paste this into an email, putting our home in front of 1000+ potential buyers with just a couple clicks of the mouse. 12


Post card campaign, which will put our home in front of many potential buyers as well. “Choose Your Next Door Neighbor”. This exciting campaign successfully enlists our neighbors to actually promote our home for us, for free. 5 Line Advertisement, the correct way to advertise. Yard signs that get their attention. Car magnets, advertise everywhere we go for next to nothing. Business cards, implementing the “three foot rule”.

Open House Real estate professionals have a bit of a disagreement on this topic, to have one, or not to have one seems to be the debate. Our question is this; why would we want to restrict exposure to our home by not having an open house? We say, don’t have one, have several. Have one every Saturday or Sunday from 1 PM to 4 PM, every weekend until our home is sold. And to go at it as if it were the grand opening of a super sale. Make it an event! This is a no brainer, this is the best way to expose our home to a large number of potential buyers, getting them inside of it, in person to view it, while giving them a chance to make an emotional tie to it, as well as see their competition. Getting people into our home is one of the biggest hurdles to jump, and we have the chance to do it successfully, large scale. Definitely yes to an open house! Holding a successful open house requires some important planning. Here are some tips that will improve our chances of offers from an open house; Use some of the same kids we use for the “Choose Your Next Door Neighbor” as human directionals, each with their own directional signs. Tie strings and balloons to each sign. Find the busiest intersection near our home and put an OPEN HOUSE sign on every corner, with arrows pointing in the correct direction. Place a sign every couple blocks until they end up at our home. Remove all vehicles from our driveway. Ask our neighbors not to park in front of our house. Turn on every light. Open all the blinds, let in that light! Turn on relaxing music softly in every room to help set an ambiance. Put a couple of drops of vanilla extract in the oven. Do not use an air freshener. A lot of people are allergic to synthetic odors. Serve refreshments and snacks. Maybe a catered lunch; finger foods, sandwiches, or maybe pizza. 13


Create a board, a display of photos, of our home during different seasons of the year. This lets buyers know what our home looks like at different times of the year, especially the yard during summer. Set out, on the kitchen table:    

Appraisal and/or CMAs and/or BPOs Warranties Blueprints for additions or possible future improvements A Purchase Contract, specific to our state. Our real estate lawyer can provide us with this.

Be upbeat and welcome each buyer who enters our home. Find out what the buyers are looking for and show how our home fits their desires. Ask for opinions. Ask each buyer what they liked best about our home and would they consider purchasing it. It may be frightening to ask for a buyer's opinion, but go ahead and do it. It's the best way to get direct good feedback, and they may just surprise us. They might decide to make an offer. It happens more often than we would think! Special notes in regards to an open house Do put away all valuables before conducting the open house. Unfortunately some people are not honest. When potential buyers come into our home, have the following sheets waiting for them; the “Home Information Flyer” and the “Financial Options Flyer”. These will be stapled together. Along with this, we will have a guest sign in sheet, which we can print from GoProFSBO.com. Be attentive that everyone we let into our home fills out the guest sign in sheet. It asks their name, their email address, and their phone number, as well as asks if they would like to be kept up to date on details regarding our home. It also asks if they have financing in place and if they have been pre-approved, letting them know our Mortgage Broker can help them with these things if they don’t already have this taken care of. Besides keeping track of who and how many enter our home, we will have their information as to be able to follow up with them. Having leads to follow up with is essential to any type of sales. When making plans for an open house, make sure it doesn’t fall on the same day as the Super Bowl or a big race. Those open houses tend to be disappointing.

Be organized, courteous, and non invasive. Let our prospects roam freely through our home after we have given them a basic tour pointing out why our home is so great. While doing so, tell them that compelling story of the benefits. Remember to tell them about that spectacular view of the mountains where they and their significant other can relax and enjoy a romantic evening on your beautiful backyard deck, rather than saying it has a wood deck with a view. Facts tell and stories sell. Help them fall in love with our home. PRACTICE our home showings 14


speech! May sound funny, but just do it. The actor who practices their lines best is the actor who wins the award, and the award for us is our home sold! If someone walks through our home and says, “eww, I wouldn’t have done that there”, stay objective. Don’t take what strangers say about our home personally. Let it go in one ear and out the other. The thing to stay focused on is selling our home quickly for a great price. Don’t get defensive, it can ruin deal. This person may be a type A personality. Just because they are boisterous about something they don’t like, doesn’t mean they are not highly interested. Keep pets, pet bowls, kitty litter, and pet toys out of sight during our house showings. Pets are a lot more adorable to us than to buyers. While our puppy Pete may say cute to use, he may say dirty to a buyer.

MLS Flat Fee Along with the great features and campaigns GoProFSBO.com has to offer, we advise looking into a “flat fee” MLS listing. Now days, there are plenty of real estate companies that are willing to put our home on the infamous MLS (Multiple Listing Service) for a relatively small flat fee. We do not have to contract with an agent, nor pay 6% of the sell price. And it does give a huge boost in exposure to our home. We have seen some very inexpensive prices in regards to this service, starting at $95. Just Google “MLS flat fee <our state>” and call a few companies to see what they have to offer along with their fee, maybe those that gave us our CMAs or BPOs. The more exposure we give our home, the better. GoProFSBO.com will aid us in marketing our home online, and we need to be as productive as possible within our own living sphere as well. Find local and regional online classified websites that will allow us to post our home for free. This may take a bit of time, but post to as many as we possibly can. We have our home description and photos ready. We pretty much just need to copy and paste our information into the sites. Google “free online classified ads <our state>”.

Niche Marketing As we start to wind down from this lesson, we want to hit on an important point; as individuals, we must use our time and energy wisely. Our time and energy are finite and we need to target market. Besides blanket marketing on the internet, we must also target that certain niche of people who will be most interested in our home, and spend the majority of our marketing time and energy on them. Are they a young family? Newlyweds? A CEO? Empty Nesters? 15


A single parent? Retirees? A young executive? A handy man? A skier? A surfer?

Title When creating our template, remember who our market is and in the “Title”, we can direct it towards those people. Examples are; close to the mountain, “Skier’s Dream”, a big yard, “Parent’s Delight”, close to down town, “Commuter’s Paradise”, near the ocean, “Beach Fun”, or if we have a dog run, “Dog Lovers”. Be creative. Now ask, what kind of Home do we have to offer? Small? Average? Big? A fixer-upper? Mid-town flat? Cabin? Beach House? Remodeled? Once we understand “who” and “what” it is we are selling, we can specifically target our potential buyers. Where will we find these people? Where do they frequent? At the mall? Church? University? Beach? 16


Country club? Grocery store? Employee’s lunchroom? Executive’s lounge? Libraries? Coffee shops When we break it down to, who is our market, what kind of home are we selling, and where the most probable places to find these people are, the task becomes a lot more manageable and we can then work in conjunction to do the most damage. Pass out our "Home Information Flyer”, stapled to our “Financing Options Flyer”, (explained later) to any place where these people may frequent; coffee shops, juice shops, skier shops, churches (flyers on car windows), schools, dog parks, or where ever we think they would be. We can hire a local high school student to do this. Make sure that they are presentable. The key is to be creative and aggressive in all of our efforts. Selling our home takes work, but when everything is signed, the sale is final, and we profit, we can laugh about it all the way to the bank.

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LESSON FOUR ~Only Work with Able Buyers~ It has happened to the best of us. Our home has been on the market for a few weeks without any serious prospects. Out of the blue we get a call from a young couple saying they are really interested and would like to come take a look at it. They sound happy and upbeat. They make a scheduled time to come take a tour. They arrive, full of energy. At the end of the viewing, they say they loved it and will get back to us in a couple days. We are excited. Three days pass, no call. We’re disappointed but push on, talking with more people, making more appointments. On the fifth day, we receive a phone call. It’s them. They apologize for the delay, say they had a couple other homes they were interested in but like ours best, and would like to come see it again. We scramble, cleaning and organizing everything. They arrive, ask to look around. We say sure, that we’ll wait in the kitchen. They take their time walking around, inside and out, talking and giggling. They make their way back to the kitchen, holding hands, telling us that they really want it and would like to talk. We assure them that it is a great home. We all sit around the kitchen table, discussing details. In general, we come to an agreement and shake hands. They say they will get back to us with a written offer. We couldn’t be happier. A few days later we receive the offer and emotionally start taking the home off the market. It took a relatively short amount of time to sell, and they couldn’t be nicer. We couldn’t be more thrilled. We take the paper work to our lawyer and sign it. We start the process of packing and call our boss in Nevada, telling him we have sold our home and can come quicker than expected. We tell all other buyers that the home has been sold. We retract our advertising and take down our signs. Then, a funny thing starts happening, a week passes and no phone call from the couple. We brush it off thinking that they are just getting things lined up. A few more days pass and we decide to call them. They tell us that everything is ok. They are just straightening some things up with the lender, you know, the usual stuff. Then, another week passes, no phone call. We start getting a bad feeling. We call them. They don’t answer. We leave a message letting them know we would like to know how everything is coming. We don’t get a phone call. We wait a couple more days and then start calling every day, sometimes twice a day. We are getting pretty upset by this time. There is no communication. And another week passes. It is like they have fallen off the face of the earth. By this time we are distraught. Finally, we get a phone call from the couple. They tell us that they are sorry for not returning our phone calls; it’s just they were busy resolving some issues regarding their loan. Regretfully, they tell 18


us that the lender has informed them that they have been denied. They tell us that they still want to buy our home and are going to talk to another bank to see about another loan. We are devastated. We have wasted over a month with this couple, and for nothing. We have taken our home off the market and have lost that all important momentum. We now have to start the whole process over again. Mean while, our home is starting to look stagnate. So on and so on…. This whole scenario could and should have been avoided. We should never let a potential buyer into our home without knowing they have at least been pre-qualified, and should never use our precious time and energy on them after the initial visit, until they present us with a pre-approval letter. The only time that buyers should enter our home without a pre-approval letter or be pre-qualified is in the event of our open house. We cannot, nor want to restrict the flow of people that show up to our home on this occasion. With that said, while talking with potential buyers at the open house we should ask if they have a pre-approval letter. If they say yes, great give them all our attention. If they say no, tell them not to worry, we have a great Mortgage Company that can help them with this, for free.

Our Loan Director At GoProFSBO.com, our Loan Directors are on call, seven days a week, for our convenience. We will be assigned to our very own Loan Director who understands the type of demand that we may have and is happy to receive our phone calls to help us with our buyers or questions. Our Loan Director can talk with potential buyers and let us know their position. With their help, we can be confident that we are spending our vital time with only quality buyers.

Pre-Qualifying and Pre-Approving Let’s explain the difference between pre-qualifying and pre-approving. Pre-qualifying a buyer entails asking questions over the phone, such as; how much income they have, what credit issues they may have, the amount of financial responsibility they have, and have they been consecutively employed, with the same employer, for the past two years? This is a good first step to filter out people that would never be able to buy our home in the first place, as well as cut down on window shoppers. If they are not serious about buying a home, they probably won’t take the time to talk with a Mortgage Professional. On that note, do not worry about scaring potential buyers off by asking them to get pre-qualified or pre-approved. A serious buyer will either already have been pre-approved and can present us with a pre-approval letter, or be thankful to us that we are providing them a Mortgage Professional that is willing to help them, at their convenience, at no cost. People that don’t have a pre-approval letter and are not willing to get one are not serious buyers. Be thankful that we didn’t waste our time on them and move on. Think of this as a valuable tool to separate the serious buyers from the window shoppers, or even more important, those people that maybe looking to see what we have inside of our home to rob.

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Pre-approving, on the other hand, is an in depth analysis of buyer’s financial and credit ability to buy our home. A pre-approval letter can be fashioned by our Loan Director. He will ask for and gather documentation from buyer to verify that buyer has the ability to buy our home. A credit score will be taken, taxes copied, bank accounts analyzed, and job verified. When buyer receives the pre-approval letter, this is pretty much a guarantee that buyer can buy, at said price and conditions. When a potential buyer presents the pre-approval letter to us, this is our green light to give them the best attention we can. We can feel sure that buyer is someone worthy of our time and energy. They are a ready buyer and now it is our job to get them excited about our home. Our Mortgage Broker works with a large number of national and local lenders; this means they can shop around to find the best rates, terms, and probability of closing our home sale. There is a wide array of down payment and closing cost programs that are available to home buyers. Along with these types of programs, our Loan Director has access to state wide and county level grant and loan programs that will help us get our home sold by offering excellent financing solutions for our potential buyers. He also has access to federal programs that offer no down payment, 100% financing. Instead of leaving financing to the buyer and hoping all goes well, why not let our potential buyers know that we have a Mortgage Professional on hand ready to get them pre-approved, financed, and even help them find certain types of grants and/or special loan programs. Having our very own Mortgage Broker on hand not only helps qualify our buyers, but also attracts buyers to our home. We have the ability, not only provide the home, but also the means with which to buy. This tool is priceless.

Finance Options Flyer After we log into GoProFSBO.com, we can call our Mortgage Professional, and will be assigned a Loan Director who will ask the details of our home so he can be ready to expect calls from our potential buyers and can start preparing the “Finance Options Flyer”, specific to our home. This sheet is full of grants, loans, and special assistance programs specific to our area and price. Between loans and special programs, our buyers will have plenty of help regarding financing that will aid them in achieving the most buying power. Don’t allow our time to be wasted with buyers that couldn’t buy our home in the first place. Only work with pre-approved, ready buyers. Get a pre-approval letter, in hand, before committing serious time and energy to potential buyers.

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LESSON FIVE ~Non-Conventional Loans, Unique~ Financing With Great Potential In this lesson, on financing, we are going to focus on non-conventional loans, unique financing with great potential. It is in our best interest to gain knowledge concerning some of the most powerful, non-conventional finance options available. Finance options that; give the biggest group of buyers a chance to buy our home, drive interest, show we are knowledgeable, and give us the most leverage in negotiating. We want to draw in the largest pool of potential buyers as we can by offering the very best financing options we can. The “Finance Options Flyer”, specific to our home, full of down payment assistance, closing cost help, grant programs, and loan options will be provided by our Loan Director. We will not go through them here, nor their details because there are simply too many, and are area/price specific. The more financing options our potential buyers have available for buying our home, the more competition there will be for our home. And in a market like ours, every extra tool, we have available, gives us that much more power to achieve our goals. We will however focus on VA, (Veterans Administration) loans, USDA (United States Department of Agriculture) loans, FHA (Federal Housing Authority) loans, seller concessions, and seller financing. All of which can drastically help us sell our home.

VA Loans VA loans are available for persons who are: Veterans, Active duty personnel, Reservists/National Guard members, and Some surviving spouses of the Armed Services of the United States of America. Lenders loan up to 100% of the appraised value of our home, no down payment, and buyer doesn’t need PMI (Private Mortgage Insurance). VA loans are assumable (assumable loan defined: A mortgage loan that allows a new home purchaser to undertake the obligation of the existing loan with no change in loan terms), which is an extremely effective tool in regards to marketing our home. If our buyer decides to sell the home in the future and interest rates have gone up, they will have the added marketability of selling the home at today’s 21


lower interest rate. As such, the same applies to us, if we financed our current home using a VA loan, we can use this to our advantage as well. Borrower’s credit score can be relatively low. Interest rates are remarkably lower than conventional loans. Any persons or parties can gift closing costs to buyer. If the veteran is transferred to a duty station overseas and rents out home, he/she may refinance the VA loan based on owner occupancy rates. VA Loans are available country wide, with no area restrictions. And even if buyer has had a bankruptcy or foreclosure, after two to three years of default lenders are quite forgiving.

USDA LOANS USDA loans are for homes that are in “Rural Areas”, designated by the Department of Agriculture. The United States is mostly “Rural” as deemed by the USDA. In fact, most counties in the United Sates have eligible areas. Don’t over look this option; we may be quite surprised to find out that our home is in a designated “rural area”. USDA loans are 100% financing, no down payment, and again no PMI (Private Mortgage Insurance). USDA loans are available to any persons who are within 115% of medium income range in a given county, the more people in a household, the larger the income range. Interest rates are usually substantially better than conventional loans. Home repairs can possibly be included in the loan. Homes that need refurbishing or rehabilitation may qualify for extra funds to be included in the home loan to go toward repair costs. And borrower’s credit score can be in the mid to lower 600s.

FHA LOANS FHA Loans are available to most anyone who is in need of one. There are no upper income or area restrictions. They are relatively easy to qualify for. They offer 96.5% financing, 3.5% down. 100% of down payment can be a gift from; relatives, close friends, or employer. Seller can pay up to 6% of the sales price towards the buyer’s closing costs, discount points, prepaids, and up front mortgage insurance premium. Lenders allow higher debt to income ratios. Lenders are forgiving of people who have had bankruptcies or foreclosures, two to three years after occurrence. Interest rates are relatively low. Fico Scores can be fairly low. And FHA loans are fully assumable as well. Besides offering fixed rate loans, such as 30 year or 15 year, FHA also offers ARM (Adjustable Rate Mortgage) loans. Unfortunately, ARMs have gotten a bad name in the past few years. The truth is that ARMs are great financial vehicles if, and we reiterate, if they are used properly. Adjustable Rate Mortgages are as they sound. The interest rate can adjust. Most are actually “Hybrid ARMs” which means they are fixed during a certain amount of time, and then the interest rate can “adjust”, or change after the fixed period. An ARM may be displayed as; 3/1 or 5/1 or 7/1. We will us 7/1 to explain how an ARM works. 7 is the number of years that the initial interest rate is fixed, as an example let’s say at 3.75%. The 1 is how many times a year, after the 7th year fixed period, the rate can adjust. So, for the first 7 years the mortgage rate is fixed at 3.75%, and on the 8 th year, and every year after that, it can adjust up or down, depending on what interest rates are doing. ARMs usually have an initial interest rate quite below that of fixed mortgages. So, it may be a good financial choice for the buyer who knows they will only live in a home for three years to buy a 5/1 ARM. This way, they 22


are getting a great interest rate and also giving themselves a couple of years leeway to sell their home. An important note on adjustable rate mortgages; no matter how long one plans to stay in a home, before deciding to use an ARM, one should always look at the fully adjusted rate to see if they can afford the payment. There are two interest rate “caps” or roofs associated with ARMs; a yearly, which is the most it can adjust each year after the fixed period, and a lifetime, which is the most it can ever go up, usually 5%, from the initial interest rate.

Seller Concessions Seller Concessions are a percent of the sale price that sellers are legally able to “throw in the pot” of a sale, to sweeten the deal. Buyers can use concessions for many things such as buyer’s closing costs, discount points, prepaids, and up front mortgage insurance premium, but not down payment. On a conventional loan, sellers can give an allowance of up to 3% of sale price to buyer. FHA loans allow up to 6% of sale price. These can be strong negotiating points when talking with buyer over final sale price, as well as attracting potential buyers to our home. The fact that we are offering seller concessions should be added to “Extras”, in our template. The amount should however not be revealed until we negotiate their offer.

Seller Financing Here is a question we need to ask ourselves; what do we do with those buyers who want to buy our home but just don’t quite fit into the box lenders are forcing buyers into these days, those buyers that are worthy of our time but are just short of being able to get traditional financing? We are not talking about people that could never get financing. We are talking about those buyers that may have had a lapse in employment, a 30 day late on their credit, or have had a foreclosure because of a layoff or some other unfortunate circumstance. What do we do with these buyers, who although may have a blemish on their name, obstructing them from traditional financing today, are good people and could otherwise get financing to buy our home? Do we send them away with their tail between their legs, feeling defeated ourselves? Or, do we step outside the box and gain access to a massive pool of grateful buyers? There is a huge group of buyers, while not being quite able to get traditional financing today, can get traditional financing in the near future. These are the same people that could have gotten financing a few years ago, but because of the credit crunch and other economic factors are shut out of the home buying game. These types of buyers are good people, but unfortunately have had bad things happen to them. These types of buyers understand the position they are in and are appreciative of sellers that are willing to work with them, the kind of appreciation that pays in $$$. Instead of restricting our ability to sell our home, why don’t we step outside the box ourselves? We can negotiate a higher sale price and down payment if we are willing to consider buyers who are just about there in regards to being able to buy our home outright, but need a little consideration.

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Seller financing is a fantastic way to open the door wider to let more opportunity and buyers come to the offering table. There are a variety of ways to conduct seller financing, some safer than others. We strongly advise against engaging in any seller financing that relinquishes title or other legal rights to our home unless we are a seasoned investor with plenty of experience in strategic home selling and acquisition! With that said, we are going to talk about the safest and simplest strategy that will bring us the quickest and biggest success.

Lease to Purchase Lease to Purchase is the quickest, safest, easiest, and most lucrative seller financing option that we can take advantage of, even if we are over leveraged in our current loan. We can have top sales price, even when demand is low, positive monthly cash flow, the largest market of buyers, minimum risk, no maintenance, no land lording, and our favorite, a non-refundable down payment. When we offer Lease to Purchase, we are designating a time frame, to buyer, in which they can lock in the exclusive ability and price to buy our home, usually anywhere between one and three years. For this right, buyer pays us a sizable non-refundable down payment, which is ours to keep, whether or not they are successful in obtaining traditional financing to buy our home within said time. On top of this down payment, they pay a monthly lease amount that is above average for a home like ours in our area. A portion, or the entire extra amount above fair market rent, can be added to the down payment, accruing over the course of the agreed time, so when time comes when they exercise their right to purchase our home, they will have a documented substantial down payment to aid them in the purchase. We actually can escalate our monthly cash flow by refinancing our home. If we have either paid a portion of our principal down and/or todayâ&#x20AC;&#x2122;s interest rates are better than our current rate, we can refinance our home, lowering the monthly payment and raising the monthly cash flow. We can always find out if this is a viable option for us by asking our Loan Director. Down payments are to compensate us for taking our home off the market, giving them the ability which would otherwise not be afforded by a lender to purchase our home. This is a win win situation. We are able to sell our home quickly in a market that may have not permitted otherwise, and buyer is able to buy a home when lenders wouldnâ&#x20AC;&#x2122;t have loaned them the money. This tool not only gives buying power back to those that have been cut out of the buying game, but also gives us sellers that may be under water, the opportunity to sell when traditional means wouldnâ&#x20AC;&#x2122;t have allowed so. We can sell our home for a given price, even if that price is above market value. We can extend the buying period, to buyer, until home prices have had a chance to rebound and come to equilibrium with what we owe. If we have an FHA or VA loan, this is even better. If interest rates go higher than what we currently have on our loan, we have the added benefit to sell our home with the better interest rate, because FHA and VA loans are fully assumable. A Lease to Purchase is implemented by two contracts; a lease contract and an option to purchase contract. 24


The lease contract legally obligates buyer to lease the property for said amount of time. And the option contract gives them the ability to buy the home during said amount of time, for said price. Although, as with any business transaction, there is risk associated with a Lease to Purchase strategy. What if buyer, for whatever reason, ends up not buying our home? Well, that actually isn’t too bad either. Selling our home is our first and foremost goal, but let’s say that buyer does not end up buying our home. Are we that bad off? We have a non-refundable down payment, our mortgage has been paid, and on top of that, we probably have been receiving positive cash flow every month. Not to mention, we have been afforded the priceless ability to move on with our lives. Some people would say this is a good investment. However, our objective is to sell our home. So how do we properly hedge against the possibility of buyer not purchasing our home? We obtain a sizable down payment, a percentage of the home that we are comfortable with. We obtain all pertinent information regarding buyer, such as; credit, income, job, and a background check to know that we are working with a viable buyer who has relatively small complications in regards to obtaining traditional financing. Most of this has already been obtained by our Loan Director and can be presented to us, with consent of buyer. With this information, we can see what factors need to be addressed by buyer to obtain traditional financing in the future. Our Loan Director can help buyer find the best route to take, to clear up any issues that may need to be addressed. The earnings potential for us is tremendous since a well-negotiated deal will reap profits at every stage of the game.

Benefits of Lease to Purchase Top sales price, even when demand is low (A buyer’s market): We attract more buyers who are willing to pay a higher sale price because of the exclusive financing terms and value we're offering.

Ability to sell our home, even if we owe more than it is worth: This is a great way out of a drowning mortgage.

Higher than usual lease amount: Since we are flexible on our financing terms, and are offering a tremendous value, we can demand a higher than usual lease amount.

Positive cash flow: Since we can demand a higher than usual lease amount, our positive cash flow is increased. 25


Non-refundable down payment: When a tenant/buyer signs a Lease to Purchase contract, we receive a non-refundable down payment that is ours to keep, regardless of them defaulting or deciding not to buy.

Highest quality tenants: Because we are leasing to tenants who have a vested interest in our home, they will act like homeowners and tend to take great care of it.

No maintenance, no land lording heartaches: Tenants who have a vested interest and feel a "pride of ownership" that encourages them to pay on time and perform maintenance.

Our tax benefits are held in place: We remain on the deed until the option is exercised, so we maintain all of the tax benefits as the owner.

Largest pool of buyers: We are marketing our home not only to traditional buyers, but also to renters and investors. These three groups, combined, make up over 93% of all the real estate buying force.

No vacancies: When we advertise our home with ability to buy as a Lease to Purchase, our phone will ring off the hook! Typical turnover time is days or weeks.

Ability to move on with our life: We can be free of a home that we don’t want, or maybe cannot afford! If we plan on purchasing a different home, we have the benefit of counting 75% of rents towards our income. So, we can go ahead and purchase our new home, even though we still have our old home in our name! If we are offering our home as Lease to Purchase, our advertisements should show this BOLDLY. These financing options are going to open the door of opportunity, for us, and allow us to reach our goals and beyond. When speaking with our potential buyers, we can tell them about all the powerful financing resources available to them. If we are willing to sale as a Lease to Purchase, we should let buyers know by putting this option in “Extras” as well. If we are interested in selling our home as a Lease to Purchase, and would like professional help with the process, from A to Z, let our Loan Director know. The fee is affordable and paid by the buyer.

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LESSON SIX ~Sales Are Not About a Product, They~ Are About Emotions We have commented on, in almost every lesson, the importance of emotions. The way to sell our home is not to show features alone, but to accompany those features with a story of benefit to buyer that engages them on an emotional level. The great economist, Andrew Carnegie said, “When dealing with people, let us remember we are not dealing with creatures of logic. We are dealing with creatures of emotion, creatures bustling with prejudices and motivated by pride and vanity”.

Sales are About Emotions, Not Logic Sales are not about a product; they are about emotions. They are about how a buyer feels about themselves when they are in that car, in those clothes, or in our home that creates that must have feeling. Buying a home is an emotional decision and before a potential buyer will ever put an offer on the table, they must get emotional about it. This is a fundamental concept we must understand. The nephew of Sigmund Freud, Edward Bernays, changed industry in a profound way by transforming the way in which we market, advertise, and present products to buyers. Before Bernays, goods and services were presented to appeal to reason and logic, through practicality. With the aid of his uncle’s book, “A General Introduction to Psychoanalysis", Bernays showed that selling to deep emotions really is the most powerful way to get results. Advertising, marketing, and sales use our emotional drives to get us in the mood to purchase. It is not the features or practicality of our home that will get buyers excited about it; rather it is about tapping into an emotional zone and harmonizing with it. If we wish to motivate people to buy our home, we need to find which emotions will motivate them, and cater our home around these emotions.

11 Primary Emotional Needs of Buyers The following are 11 of the primary emotional whys home buyers need satisfied before they make a decision to buy a home. It is our job to discover the 3 most important motivators of a particular buyer and show how our home will satisfy them. 1. COMFORT: Ease, Satisfaction, Relaxation, Etc 27


2. CONVENIENCY: Simplifies, Location, Etc 3. ENTERTAINMENT: Pleasure, Amusement, Etc 4. PRESTIGE: Set themselves apart from average, Success, Rank, Etc 5. RECREATION: Enjoyable, Fun, Etc 6. VALUE: Money, Beauty, Quality, Price, Etc 7. ECONOMY: To save or make money, Price, Loan, Etc 8. HEALTH: Area, Location, Etc 9. PRIVACY: Space, Exclusion, Etc 10. AESTHETICS: Beauty of setting, Ambiance, Location, Etc 11. SAFETY: Location, Area, Children, Etc When writing about our home in our template, and when we create our speech for our showings, integrate as many of these emotional triggers as we can, into our story, to appeal to the broadest number of potential buyers as we can. When we see particular motivators eliciting an emotional response in a particular buyer, we should concentrate on these triggers. While getting our potential buyers as emotional as we can about our home is essential, it is just as important that we stay as unemotional as we can ourselves. The more objective we stay, the more control over the situation we will have. Obviously, our home is not just a business transaction for us. We have plenty of emotions associated with our home. Although, the more we focus on our goal and leave emotion out of it, the more successful we will be, especially during the negotiating process.

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LESSON SEVEN ~Everything is Negotiable~ Many buyers will be brought by a Realtor. We can either decide, from the beginning, that we are not going to pay commissions for a buyer’s Realtor, and cut out A LOT of buyers, or we can negotiate how the commission will be paid. Now that we have buyers interested in our home, we need to focus on negotiating with these buyers. Negotiation starts from the initial point of contact, and continues until the sale is final. The essence of good negotiating is based on building a relationship with buyer, by creating dialogue through questions and active listening, and creating trust and common ground. The absolute wrong way to start a dialogue is by talking about price. We don’t ever bring up the subject of price to a buyer. Our dialogue should be oriented around what we have of value and the desires of our potential buyers. Dialogue is created by sharing our self with buyer and learning who they are through questions. We want to find what their emotional triggers are, so we will know which things will give us most leverage as tradable items. Then, offering tradables to buyer to negotiate our wants. (A tradable is something relatively easy for us to give and relatively valuable to the other side) Ask questions that elicit feelings, by asking “How do you fell about….?” “How does that make you feel?” Ask questions about their family, their work, and why they are moving. Do not ask questions that can be answered with a simple yes, and more importantly with a simple no. Ask open ended questions that get them to a position based on feelings, which will allow us to see what drives them. We need to take our eyes off our needs and focus on what we have to offer them and their desires. Ask them directly what they are looking for and want in a house. After each question, we stop talking and listen. This is critical to any successful negotiation. Listening is an active process; it requires not only ears but mind as well. We must have control over our body position, our breathing, our thoughts and most important, our emotions. Active listening requires the ability to listen carefully, focusing on not only what buyer is saying, but how they are saying it, when they are saying it, and in what context they are saying it. Focus on their message and be constantly thinking how we can use this information to show that our home is the perfect match for their needs and wants. We should be conscious in our dialogue, always being polite, professional, and positive. We need to be passionate about our home and about selling it. Don’t confuse passion with emotion. Emotion can creep its way into the sales process and create turmoil. Many sales have been lost because seller has failed to control their own emotions and have taken a position of defense.

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#1 Reason Why a Sale Fails During Negotiations Most every sale that fails during negotiations can be attributed to the mistake of taking a defensive position and trying to prove a buyer wrong. This creates a downward spiral which usually never ends with a sale but makes the sale suffer a slow and painful death. Trying to prove an opinion wrong is useless. Don’t get caught up in petty arguments. Stand arms length from the situation and be as objective, polite, professional, and as positive as possible. All of these points should be integrated into our home showing speech, to make time with buyer as productive as possible.

Using Our Appraisal for Maximum Leverage Near the end of our home showings, we can use our appraisal to further our value position. Casually, let buyer know that we have recently had our home appraised, and that “We are happy with the results”. Don’t tell them the value, but give them the appraisal to look at. Along with the appraisal, point them to the rest of the paper work, that we may have, neatly spread out on the kitchen table; CMAs, BPOs, home warranty, or inspection. Simply state that we are excited about the results and expect the home to be sold quicker than we had thought. “We are getting more interest in our home than we had expected.” If they ask if we have offers, be truthful and always optimistic, even if we haven’t gotten one yet. Just tell them that we have been getting good responses and if they would like to make an offer, to go ahead and do it as soon as they can. “With the kind of response we are getting, we think that we will be selling our home quicker than we previously had thought.” They should just go ahead and put in the best offer they can propose. If we already have an offer or offers, don’t tell them the amount of the other offers. Let them know we are pleasantly surprised with the response, forcing them come to the offering table with their best game. Don’t tell them what they are up against in regards to price, unless we have a solid buyer who put in an offer that we would be willing to accept. Then, we can tell them their competition, hopefully enticing them to beat it! Some points we need to be aware of during the negotiating process: Have a clear picture of what we want. Always negotiate a deal where both parties come out with a feeling of victory. There is always another solution that will meet both parties’ needs. Negotiating is a game; this is probably the biggest thing most of us will ever negotiate, but it is vital to act as if it is no big deal. Everything is negotiable. Go into the situation with a compelling positive vision of the outcome. 30


Advanced preparation is absolutely critical, the best prepared usually wins. The more time we put into preparation the better our outcome. The best negotiators are good listeners and ask great questions that help them advance their position. Really listening to a potential buyer tells them that we about care them and value their opinions. Before getting strung up on a certain negotiating point, always ask ourselves; in a year will it even matter? It is important to understand that we cannot be reasonable with unreasonable people.

Offer and Counter-Offer When we receive an offer, there are three areas to negotiate; price, terms, and contingencies. Dealing with price, we can accept, reject, or counter-offer. Our suggestion is to counter any offer, whether it is a small counter or not. Dealing with terms, the main points will be personal property, timeline of closing, commissions, and conditions that need to be met. And regarding contingencies, there are issues concerning financing contingency, inspection contingency, or maybe selling their own home before they purchase ours contingency Always respond to an offer in writing, no matter what our response is. If we reject or counter an offer, we need to incorporate the following ideas; Be professional, polite, and positive, especially when rejecting offers. Sincerely thank them for their interest and their time. Give them the specific reasons why we are rejecting their offer; price, terms, contingencies? Include our area of potential agreement. Let them know what our area of potential agreement would be. Include specifically what we are rejecting and what we would accept. Validate the changes we are making to their offer by logic and statistics, leaving feelings and emotions out of it. It is important to leave the door open for them to counter our counter offer. â&#x20AC;&#x153;We would love to hear from you, if you are willing to make some changes to your offerâ&#x20AC;?.

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Leave it on a positive level, â&#x20AC;&#x153;We are hoping this will end as a successful transaction for the both of usâ&#x20AC;?. A properly negotiated deal is one in which all parties leave with a feeling that they have won on some level. Donâ&#x20AC;&#x2122;t be apologetic, be firm in our position. Know what we want before we ever meet with a buyer. Stand as a firm negotiator. And offer tradables. Make our giving of something conditional on them giving us our wanted item. Negotiate by using if, then proposals.

Tradables If you are willing to pay this price, then we will award this % towards closing costs. If you pay this price, then we will pay your Realtor. If you do this, then we would be willing to do that. Etc, etc, etc Be creative. Remember what our buyer is emotional about, and cater around those desires for the most leverage. Go at selling our home with attention, focus, and energy. The better prepared we are, the better we will do. Plan our work, and then work our plan. We will fare better than anyone else trying to sell their home if we implement all the fundamental principles that we have learned here.

Good luck and happy home selling!

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