Coach Mitch’s REFLECTIONS™
The other day I got a good question from a wannabe real estate investor. I always try to help. It is especially important to help those who have tried something and didn’t get the results that they had hoped for. Most don’t try at all, some try once, and if it doesn’t work then they quit. A few will continue. Therefore, when asked, I give as much input as I can until I feel that I am being taken advantage of.
From: Interested Party
Sent: Wednesday, August 17, 2016 6:36 PM
Subject: Question(s) on Tax Delinquent Investing
Good afternoon Coach Mitch,
My name is H and I’m a student of ^^^^^, and yesterday I came across your website and was impressed with the material there.
I wanted to see if you could entertain a few of my questions and provide me with your experienced input.
I’ve just begun with my first campaign sending letters with offers out to owners who are about to lose their properties to tax deed auctions a month away, mainly in FL and PA… my first batch was 208 letters and second batch a week later was 237 letters.
I know that my first batch arrived to their mailboxes 2 days ago (last Monday), and so far I’ve received only one missed call. I tried to call them back but their VM was full. I would have expected a faster response rate, since the deadline for them is soon.
Anyway I just wanted to ask what do you think I should expect in terms of when I should hear back from the owners, and when to begin calling them when I don’t hear from them? What would be a good way to approach them on the phone and get them to open up to me? How many times should I attempt to call them?
Those are my main questions for now, thank you for your time and help!
On Thu, Aug 18, 2016 at 12:52 PM, Mitchell Goldstein <CoachMitch@coachmitch.com> wrote:
I’m impressed that you have taken action. Most do not. ^^^^’s approach is a good one, and, over the long term, you will do well. Unless you object, I will use your letter and my answer in a blog so that others can benefit.
You’ve asked one of the cogent question that all gurus do not spend enough time on, i.e. the sales aspect.
Proper negotiation is the most important part of the transaction. There are millions of motivated sellers. Sadly however, only a few are dealt with in a professional manner. Gurus will speak about creating a “win-win” solution but do not give clients a good understanding of how to go about creating that win-win solution. Therefore, most prospects say “No,” and all your efforts are wasted.
First, know that most folks will somehow find the monies to pay the taxes. This is true even in high tax areas like Chicago, IL. It is even more true in moderate and low taxed areas like Florida. Reverse positions, wouldn’t you do whatever you could to find the monies to save your house?
If mailing close to the tax deed auction, I don’t like to wait for people to respond to me. After the first mailing, I advise my students to go direct to the prospect, either by knocking on the door or by making a phone call. There is no reason to stop calling until you get a “No.”
In this case, you have sent them a letter with an offer. I’m presuming you mention the impending tax deed auction. Since the prospect knows that you know about their dire situation, they are not surprised at a low offer and the conversation can be direct:
Here are some questions to ask:
Q1: “Do you have the cash to pay the taxes?”
Q2: “If you can’t pay the taxes, what are you going to do?”
Q3: “What are you trying to accomplish?”
Q4: “What do you think about this idea…?”
Coach Mitch says, “Just say ‘Yes.’ “
Determine what it is that the prospect needs to move on and agree to give it to them. The trick is to figure out how make a profit while still giving the seller what they need.
Anyone can do a bit of research, get a list and send out some letters. However, when someone does answer, how do you instill the needed confidence in a prospect so they will choose you? Why should the seller choose you over everyone else who is after them to get that great deal?
The Regular Real Estate Investing Formula:
MS + REIT = PST
Motivated Seller + Real Estate Investing Technique = Potentially Successful Transaction
Coach Mitch’s Real Estate Investing Formula:
MS + REIT + GNS = ST+
Motivated Seller + Real Estate Investing Technique + Good Negotiating Skills = Successful Transaction +
+ is not just getting a higher number of transactions, you should also try for:
· lower purchase prices,
· higher selling amounts,
· seller being OK w no deposit,
· seller giving you more trust, admiration,
· seller giving you benefit of the doubt,
· when you ask for seller to hold paper – at 0% interest.
In sales, everything matters.
All the above items are or should be uppermost in your mind when speaking to any prospect. Everything the seller says is analyzed. Every word you say is calculated. Every gesture is important. Every idea is premeditated. This is not rocket science but it is not easy and it does not come naturally to most. That is why only 20% of all professional salesmen make 80% of all the commissions.
Call anytime to speak about real estate.
I hope this helps. Be diligent. Stay the course.
Mitchell Goldstein – Coach Mitch
Hi Coach Mitch, thanks for your quick response!
So a quick update, I did get (just) one call from an interested seller yesterday and he signed and faxed over the contract, so now I’m working on that deal. Nothing spectacular, just a residential subdivision lot (with a pool) in Florida.
It still leaves me thinking though why only 1 deal came out of over 445 mailed letters. I was thinking, would you mind it if I sent you a copy of what I mailed them, and you can give me your quick input/analysis as to the strong and weak points? I’ve attached a copy for your review if you like… an intro offer letter and then a purchase agreement.
And yes you definitely have permission to share my question on your blog!
Thanks again and have a great weekend!
Congratulations, you got a deal!
Now all that you need do is to not mess it up, close, then find a buyer willing to pay you more, negotiate that deal, not mess it up, close, and then find another deal and do it all over again.
I used to take control of one property per day and close on a property each week. The first one is the most difficult. Hopefully, it is the beginning of a cookie cutter.
I did review your letter and your contract. They did the job as you got a deal, but my approach is quite different.
- I never advocate sending 445 letters.
- The typical mailing I advise is 25 to 50 pieces.
- I like postcards versus letters because everyone reads a postcard.
- The typical response rate is around 10%. If sending 30 postcards, that’s 3 responses.
- The letter you sent is closer to the old style we stopped using a long time ago. It is very long and does not say anything that the tax delinquent really wants to read about. Sellers in trouble only want to know if you will help them get out of trouble and how much you will pay. Everything else they think is a waste of their time.
- The contract you sent has too much legalese for my taste. There were entire paragraphs that are not necessary.
- I like simple. People respond better when the documents are short, easy to understand, in plain language, with letters that are large and numbers that are bold.
- See Coach Mitch’s “Ridiculously Simple System…” ™ for details.
I hope this helps,
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