Strategies to Help Close Deals

How successful note buyers keep deals moving from inquiry to closing.

Where do you think note deals can stall out?

Is it during due diligence, while trying to collect all the necessary documents for underwriting? Is it during a Purchaser Interview? Is it BPO or title? Maybe it’s when the seller realizes the note can’t be purchased for 100% of the unpaid balance?

While those can all be moments that give pause, it might surprise you that it’s the lead-up to providing a formal offer where we often see note sellers disappear.

Looking at our lead spreadsheet, you’ll see the color yellow really stand out. That’s the color category for “Collecting Information.” But these sellers reached out to us — where did they go?

Strategies and Traits to Help Close Deals

Listening, persistence, and problem-solving. Those are the three strategies and qualities we see in consistently closing note buyers and brokers.

Listen First, Talk Second

On the surface, note sellers contact buyers because they need cash.

But it’s often more than that.

Their circumstances changed. They had an emergency come up. They want to invest in something new. They are frustrated with collecting monthly payments. They are ready to move away from an old situation and towards a new one. As note buyers, it’s our job to hear them.

When you spend time listening, you discover what the Seller needs.

Maybe it’s a true full-buyout; they need a LARGE lump sum, or they have an underlying lien to pay off. Perhaps a partial would fit their needs. They don’t really want to be rid of the note; they just need a little help now. Is this an estate note, and do they actually have multiple notes to sell?

Are they speaking like a seasoned note seller? Or are they unsure of what terms to use and how the process works?

When you listen before speaking, you can offer the options and responses that make sense to each Seller. You won’t end up overly explaining to a seasoned veteran, while you can take the time to make sure a new Seller understands the process. You put yourself in the support role as someone there to advocate for what’s best for them. That’s called BUILDING TRUST.

Persistence Without Annoyance

What if you never get them on the phone? Or what if after speaking, they never send the information you need to continue quoting?

Before you go all car salesman on them, take a moment to think about the line between persistence and annoying.

• Calling them the following day and sending a follow-up email? Persistent.
• Calling them twice, texting three times, and sending two emails in a day? Annoying.
• Calling them again in a few days and again the following week? Persistent.
• Calling them every day at 9:00 am sharp? Annoying.
• Circling back every few weeks, via phone and email? Persistent.
• Showing up at their child’s school to talk to them? Annoying – and creepy.

You have to find the line. No one wants to work with someone who is pestering them. But people also get busy. They sometimes need the reminder.

And when checking in, emphasize how easy the process is to get a quote. While we would love to have all the info, when you have a hard-to-reach seller, focus on what you need to give them a preliminary quote.

Solution Mindset

No note is perfect. And as investors, we have learned to adapt – experienced investors know what they can work with and what they cannot.

And they know that if a note isn’t right for them, it may be right for someone else, such as an institutional investor with abundant resources.

Be ready to work with a seller on possible solutions. If there isn’t a third party payment history, could they provide at least 12 months of bank statements? If they aren’t sure where the documents are, can we find copies with the County or request from the servicing company? If there are unpaid taxes, can they be deducted from the proceeds?

Beyond that, what are the Seller’s problems? This goes back to listening. Do they need $50,000 or $100,000? Are they annoyed with the Borrowers? You should always ask yourself, “How can I help?”

Many problems have solutions. They may take a bit more legwork at the start, but going the extra mile may make the difference between the Seller saying this is too much work right now versus moving forward.

Closing Deals is More than the Hard Numbers

While price is certainly a deciding factor for note sellers, your people skills can make or break deals too.

Closing deals requires listening, persistence, and problem-solving. It goes beyond your calculator skills and paperwork experience.

However, those hard skills are equally important. And it’s why we created our Due Diligence Master Class – to help you combine the people skills with technical skills.