Boost Your Acceptance Rate by Asking This Question

One of the primary reasons this blog exists is to help you save time as a real estate investor.

Time is our most valuable resource. If you haven’t realized this yet – believe me, you will.

It took me a few years to really grasp how valuable my time actually was – but in mid-2011, I started experiencing some significant time constraints in almost every area of my life and it all seemed to be happening at the same time. I had just enrolled in an MBA program, my business activity was starting to explode at an exponential rate, my automated systems were generating more leads than I could handle AND I had gotten involved with a few other joint-venture projects that were requiring some significant attention to detail. I hardly had any time to sleep – and my most important priorities (my wife and family) were having to compete for my attention. It was crazy, and my time was getting pinched in ways I had never experienced before. After getting pushed to the point where literally every minute mattered, I had to make some changes to start managing my time effectively.

One of the most time-consuming areas of this business is the research process. It consumes a TON of time and unfortunately, this is a vitally important step in every real estate transaction, especially when you’re about to invest a significant amount of your (or someone else’s) money.

In a perfect world, we would all be working at 100% efficiency. We would be able to invest only as much time as necessary to accomplish only what is needed at the present time. Since I know that I can’t work at 100% efficiency (and frankly, nobody can), I try to avoid in-depth research on each property UNTIL the seller has accepted my offer. Once this happens, then I can justify spending a lot more time digging into the details of a property.

How can we possibly know what to offer for a property until we research it?

That’s a good question, which is answered here – but a more important question is:

How can we know if we’re dealing with a motivated seller?

Wouldn’t it be great to know upfront whether or not a seller is willing to work with you? I mean, let’s get to the point here! Are they motivated to sell or not??

As I found out, it is actually VERY helpful to know this sooner rather than later. Instead of blindly researching dozens of deals and sending out 20 – 30 offers just to get one acceptance (simply playing the numbers game), I didn’t have time to fish around for motivated sellers and hope for the best. I needed results and I needed them quickly.

If you want to know whether you’re dealing with a motivated seller, you need to get a very honest and direct response from them.

RELATED: What Do You Say When A Seller Calls? How To Ask The Right Questions Of Your Prospects

How can you get an honest and direct response? It’s actually pretty simple – Be honest and direct with them. Whenever I start a conversation with a potential seller on the phone, I only have two objectives in mind:

Objective #1: According to the Seller… what is this property’s FULL market value?

  • At this point, accuracy doesn’t matter. I’m just trying to nail down a starting point for what the seller’s perceived value is.

Objective #2: Is the Seller willing to sell their property for 10% – 40% of their property’s FULL market value (above)?

  • I know, 10% – 40% is a ridiculous offer price. That’s the point. However they respond to this question will tell me very quickly whether or not they are willing to cut their losses and knowingly let their property go.

In other words, my very brief conversation (3 – 5 minutes on the phone) would go something like this:

Me: “Tell me, in your opinion, what is the full market value of your property?”

Seller: “Oh, I don’t know… maybe $200,000?”

Me: “Okay. If we could pay you cash, pay for all of your closing costs, and close on this transaction in the next 2 – 4 weeks, would you consider selling your property for $40,000?”.

Scenario 1

Seller: “No, I won’t take $40,000.”

Me: “Alright Seller, if we could pay you cash, pay for all of your closing costs, and close in the next 2 – 4 weeks, what would be the absolute minimum that you would accept for your property?”

Seller: “$160,000”

Me: “Thanks for your time. I hope you’re able to find a cash buyer elsewhere.”

HANG UP.

Scenario 2

Seller: “Yes, I’ll take $40,000.”

Me: “Alright Seller, we’ll continue to do our research on your property and if we can make you an offer, we’ll send it to you within the next 7 – 10 days.”

HANG UP.

Notice how we’re not making any type of commitment here. What this ultimately boils down to is a screening call. It is very short and to-the-point and we aren’t hiding the fact that we intend to buy properties for dirt-freaking-cheap prices.

If the Seller isn’t willing to play ball with you (and believe me, many of them will make that very clear), believe me – they won’t. As soon as you know that the Seller isn’t willing to take your low-ball offer, get off the phone and move on to your next prospect.

RELATED: How to Deal With Nasty Sellers and Angry Responses

Once you realize how much time you’re saving by simply knowing who you’re dealing with upfront, you won’t mind hearing the word “No” anymore. It’s actually a blessing in disguise, because it means you can STOP wasting your time chasing after deals that will never happen – and instead, you can focus your energy on Sellers who are actually motivated to sell.

Getting these answers on the front end will save you a TON of time. You’ll also find that your acceptance rate will go through the roof. Why? Because you already know the Seller’s answer before you send them your offer.

I used to avoid these kinds of “direct” phone conversations because frankly, I was scared. I didn’t want to offend the Seller or deal with their wrath on the phone. It wasn’t until my time was being seriously threatened that I learned to stop beating around the bush and get very direct with these people.

I am a serious buyer and I don’t waste people’s time (especially not my own). If the Seller and I are never going to see eye-to-eye, it’s in both of our best interests to figure this out as soon as possible so that both parties can stop holding out for something that is never going to happen.

RELATED: The Ultimate Negotiation Technique That Nobody Talks About

Want to Learn More About Land Investing?

I'll be completely honest with you. Land investing is without question, the most powerful strategy I've used to build my real estate investing career.

This is a massive opportunity that most investors aren't paying attention to – and for the few land investors who know how to pursue this business with the right acquisition strategy, it's an extremely lucrative way to build wealth from real estate.

If you want to get the inside scoop on how to start and run your own land investing business, come and check out the REtipster Club – where we have a full 12-module course, dozens of videos, bonuses, downloads, group coaching sessions and a members-only forum (where we spend time answering questions every week). There is no better place to learn this business from the inside out!

About the author

Seth Williams is a land investor and residential income property owner, with hundreds of closed transactions and nearly a decade of experience in the commercial real estate banking industry. He is also the Founder of REtipster.com - a real estate investing blog that offers real world guidance for part-time real estate investors.

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  1. Danny Johnson says:

    Great post!

    This is really big. It amazes me when people tell me they found dozens of vacant houses and have researched the deeds for each house back to the 50’s or whatever. WHY!??!!

    What a huge waste of time. That time should have been spent getting in contact with the owners of those houses, finding out who is motivated and trying to make a deal.

    Nice blog, Seth.

    1. Seth Williams says:

      Thanks Danny! I appreciate you stopping by. I can tell you’ve been in this game for a while too… your experience really shows. Thanks again for your insights.

  2. Hermes Birkin says:

    You made some nice points there. I did a search on the subject and found most persons will agree with your site.

  3. Glennpeter Espinosa says:

    Great blog again Seth!

    I especially like the line regarding the answer NO being a “blessing in disguise.” I’ve never thought about it that way and it was pretty enlightening. Thanks again!

    Glenn

    1. Seth Williams says:

      Thanks Glenn, for your comment. It’s good to hear you weigh in on this. As crazy as it sounds, I’ve almost learned to love the word “No”. Anything that gets to the point and saves me time is a good thing in my book!

  4. Jason says:

    Excellent post!

    I have been wasting time with sellers that are not motivated enough. Thank you for opening my eyes to this and the need to stop wasting my time and the sellers.

    1. Seth Williams says:

      I know your pain Jason – I’ve been there many times myself. Luckily, I’ve learned to filter them a bit better. 🙂

      Glad you found this post helpful!

  5. Hayya says:

    Hi Seth – I love how this question cuts to the chase.
    Question for you: I’ve been doing drive-by farming and am now reaching out to owners by phone, what have you found is the most effective way for opening up the conversation about them selling their property to me?
    Thanks for your help and insight!

    1. Seth Williams says:

      Hi Hayya – that’s a great question. I personally haven’t targeted many of my properties this way (I usually start with a letter and wait for them to reach out to me). However, one guy I know who is really good at initiating these kinds of phone conversations is a guy named Claude Diamond. You can see an example of how he does it here: http://youtu.be/aZoywcZ3t_k

      Hope that helps!

      1. Hayya says:

        It does. Thanks Seth!

  6. Pavel says:

    Hi, Seth. From all houses that you bought, could you name 3 main sources of leads?

    1. Seth Williams says:

      Hi Pavel, it’s really just been two primary sources – direct mail and my buying website.

  7. Mitch says:

    100% American cut-throat rubbish.
    Gosh, lucky you that you’re not asking for a sales job in my company, I’d just ask you:
    How much do you think your job is worth paying you?
    You’d say 5K a month
    I’d say: Are you willing to start today for 1.2K a month?
    You’d say No.
    I’d ask, how much is the minimum you’d expect to be paid?
    You’d say 3K
    I’d kick your ass out of the door and with a typical American smirk on my face say; “good luck finding a job”.

    Wanker!

    1. Seth Williams says:

      LOL! Thanks for the morning laugh Mitch!

      I’m not sure if it’s an “American” thing or a “free market” thing, but the bottom line is – you or I can demand whatever we want in life (e.g. – I can demand a high salary, and you can demand a cheaper employee), but it’s all meaningless unless we’re both offering a viable solution that the other person is willing to pay for (either in time, money or both).

      In your scenario above, I would never be asking for $5K a month unless I had verifiable proof that someone else was willing to pay me just as much… or that the size & scope of your problem warranted such a price tag – (and that I actually had the solution). If you did kick me out the door, that would certainly be your prerogative – but it also wouldn’t be difficult for me to move to my next best option or find someone else who was willing to pay me what I know I’m worth.

      1. Jason says:

        I’m curious to know what Mitch’s company is? Isn’t paying someone 1200 a month “Cut throat”, too? There is no such thing as cut throat. Everyone accepts what they get. If they say they don’t, they are a victim. There is always a choice. At least in this country.

        1. Seth Williams says:

          Thanks for chiming in here Jason. I’m glad to hear someone is thinking with some perspective. 🙂

  8. Theresa Hill says:

    I am looking to stop urban decay in my neighborhood. Thank you for giving me tips on how to find cash buyer so that I can buy and rehab these vacant properties in my community. If you know some investor that want to help they can contact me on my website.

  9. Daniel Duque says:

    Hi Seth,

    What do you reply to when they say, “Well, how much are you willing to offer?” People who refuse to give you their property’s price

    1. Seth Williams says:

      Hi Daniel – this is actually pretty common, and regardless of what they say (or what they think their property is worth), it never changes my offer price. It’s almost always around 10% – 30% of their property’s market value (whatever I determine that to be).

      Hope that helps!

  10. josh says:

    Mr Williams will you explain what is the point ?

    I mean if someone post an ad for a land for 200k, and i call for quick closing with all cash, and he says “you know what, if it’s cash and 1 week closing that’s a deal – in 60% lower then asking price”

    dosent it means something is wrong with the land? who will lose 60% to close a deal?

    1. Seth Williams says:

      Hi Josh – there could be something wrong with it – but if you’re looking for motivated sellers the right way, you’ll find that there are MANY people who are happy to sell a perfectly good property for pennies on the dollar, simply because the property is a problem and their life and they want it gone (and you’re making it easy for them). Check out this blog post for more details.

  11. Alex says:

    Seth,

    I just sent out my first batch of mailers, and I’m absolutely terrified of someone calling me. I have no experience in any aspect of this whatsoever except purchasing my own first home six years ago, and having relatively decent people skills. I’m devouring your articles left and right (and thank you so, so much for making your insight available).

    My question is twofold: If I’m buying a property that is relatively remote from where I am, and I have no knowledge of the market in that area, how can I know what it’s truly worth? And how can I buy it without being physically present—or do I have to drive there in person?

    I’m starting small and safe—properties that are only (or mostly) land, assessed at under $20k by the county—but I have very little cash to my name, only an excellent credit score which I’m afraid to ruin by taking out excessive bank loans to kick-start my investing. If you could address my question, and any other factors I’ve overlooked, I’d be most appreciative! Thanks!!

    1. Seth Williams says:

      Thanks for your comment Alex! Here are a few blog posts you may find helpful:

      https://retipster.com/when-seller-calls-ask-right-questions-prospects
      https://retipster.com/overcome-phone-anxiety
      https://retipster.com/valueofland

      Specifically – check out the last one with regard to the land value. I hope those help!

      1. Alex says:

        Thanks a million!! By the way, I also just finished reading the article on angry/nasty responses, and thank you so much for including audio clips of people’s responses. Just listening to them made me offended and inflamed and a little intimidated, and I’m not even the one they were talking to. Made me realize I need to harden up my nerves a little in advance.

        Extremely helpful!

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