Mitch Goldstein | Coach Mitch | July 16th, 2010Coach Mitch’s REFLECTIONS™
The Wannabe
When someone asks me how to be a successful real estate investor, I ask them what they think makes up that success. Invariably, they maintain that knowledge of some real estate investing program is needed, like how to do foreclosure investing, or lease optioning, or rehabilitation, Subject To, etc.
When I ask if they have ever invested in any real estate investing education, most say “yes.” They have spent many hundreds, sometimes thousands, on their investing education. When I ask if they have put that education to use, they say “No” they have not done any transactions.
I ask, “Why not? What has stopped you?” They all shrug their shoulders sheepishly, and either say, “I don’t know,” or they admit that “I’m scared.”
Most advice givers sagely say – “just go out and do it.” Obviously, that is correct, but it is much easier said than done – or we would all have gone out and done it already.
The real estate investing courses we see on late night television all tell you WHAT TO DO. Unfortunately, and much more importantly, these guru’s do not hold you by the hand and show you HOW TO DO IT. That is the difference.
What I do
I help my students to overcome the debilitating and almost overwhelming “Fear of Failure.”
The “Fear of Failure” is infamous and the trait runs throughout humanity, restricting our fulfillment. The tool I use is – one on one role playing. We role play the situations that the newbie real estate investor will encounter while doing real estate investing activities. In this manner, the student is ready when the situation arises. We learn the most through observation and doing and less so from reading.
When I think the student is ready, I send them off on the specific mission that we had trained for. Armed with the correct knowledge and methods, my students are always successful.
The record
The record is $1,600,000.
Using only $1, a new student took control of a property valued at $1,600,000 using Coach Mitch’s “famous $1 Option.”™
The story
The student was a very shy, bookish type, in fact, he was a researcher. Girls scared him, and he cringed from stressful and confrontational situations.
To his credit, in order to be a successful real estate investor, the student said that he would “just do what I suggested.” We rehearsed opening statements, potential replies, and responses to potential replies. We rehearsed entire conversations. It was almost like practicing for a stage performance, and, in some ways, that is sort of what we do. Like a Broadway director, I give the motivation and direction; the student acts.
The student had, on my instruction, sought out several properties that he wanted to pursue.We practiced for those situations. When ready, I sent him off. He seemed confident.
The Action
On this student’s very first property, on his very first conversation, on his very first attempt at a transaction, this student impressed a seasoned businessman to such an extent that he gave this student control of his $1,600,000 restaurant – and the restaurateur only received $1 in payment. WoW!
Sun Tzu would be proud. He taught that the greatest victory is one where the other side gives up without a fight.
There is Science in Art
The reality is that most of us have little training in speaking with people. Even most professional salesmen don’t do it well. It is well known that 80% of the sales commissions are earned by only 20% of the salesmen.
The biggest thing to remember is to put yourself in the other person’s shoes, have empathy. Validate their feelings, their knowledge, their experiences.
Before you say something, anticipate what the other person’s reaction is going to be.
Try to foresee what that person will feel and what their reply might be.
In this manner, you can frame your questions so that you can aim the conversation in the direction you desire and illicit the answer you want. It takes a little practice, but it is not hard, and it provides big dividends.
Suggestion
When driving around and seeing a prospective property, stop, knock on a neighbor’s door, and ask, “Hello, you don’t know me. I’m Malissa. I’m sorry to bother you, but I’m looking for some property in this area. I stopped because I was wondering about the property next door. Might there be anything that you tell me about it?”
That’s not so hard is it? However, this is not a set of words chosen at random. Everything is choreographed.
First
You should put the homeowner at ease. Knock, then stand sideways with your profile to the entrance, and be well away from the door. When the door opens, wait one full second, so that the homeowner can look you over, then turn to face the homeowner and sport your best smile. “Hello, you don’t know me. I’m Melissa.” You say your name last because the person needs a few seconds to determine if you are friendly or someone to be wary of. If you said your name first, they would not remember it and would feel uncomfortable.
Then
You can anticipate that the neighbor is angered that the dilapidated home next door has lowered their own home’s value and created an ugly vision on “their” street. As an investor, you might help in that situation.
Therefore, justify your intrusion. “I’m sorry to bother you, but I’m looking for some property in this area. I stopped because I was wondering about the property next door.” The neighbor now knows that you are a potential friend, someone who can help them.
Next
Wait one full second before continuing, because sometimes people just start blurting out things.
Frame your question correctly; “Might there be anything that you can tell me about it?” You can also say, “the home” or “the situation.”
Isn’t this question better than something terse sounding, like: “What do you know?” Or “What’s going on?” or “Where’s the owner?”
Framing the question the way I suggest makes it sound like you are asking permission to get information. Your are also leaving the decision to answer up to the person. You are exposing your soft underbelly, like a puppy. You are being mannerly, nice.
Sometimes you get lucky and the person just opens up and spills all. Other times the person is suspicious. After all, they might be a friend or a relative.
“Who are you?” or “Why do want to know?” could be a typical response.
Rinse and Repeat
Just repeat. “I’m Melissa.” Hold out your business card. (500 free from Vista Print) “I’m looking for property in this area and I liked this street.” You’re giving an indirect complement that the neighbor has good taste. “I saw this property and was wondering about it. Might you know anything about it?” All you did was repeat your opening statement. However, this time it has more credibility.
Sometimes you get asked something like: “Are you with the police?” or “Are you a debt collector?”
“Oh my goodness, no, I’m not with the police. I’m just looking to buy property. Is there something about this property that involves the police?”
This is a sales technique called, “The Push-A-Way.” You are indicating that you might no longer be interested in solving the neighbor’s situation; so naturally, they try to reel you back in. “No, I was just checking.”
After a bit of this back and forth, you have established:
- you are not an ax murderer
- you are a potential friend
- you don’t scare
- you seem confident and professional
- you could be financially beneficial to the neighbor. This is a great beginning.
Victory
Be ready, because their next question is: “What do you want to know?” You should have an entire list of questions ready and each must be reworded carefully to fit the particular situation.
The first question I like is: “What can you tell me?”
A question like this lets the neighbor pick the information he chooses to speak about.
You always want to know details. “How did the homeowner take care of the home?”
Finding the owner
I usually try to get the neighbor comfortable talking about harmless things first, like the neighborhood, the schools, the shopping, the home and its history, etc. Then, after a bit of warm-up, and after they have gotten used to the idea of gossiping, I go for what we all need to know.
You want to know who might know where the owner is.
Which question sounds better?
“Do you know where the owner is?”
OR
“You are a neighbor, so I presume that you have a special relationship to the owner. Is there anyone else that might also have a close relationship?”
OR
“Who looks after the property for them?”
What might the range of answers be?
1) “I don’t know anything.”
2) “Bill across the street is his cousin.”
3) “I wasn’t on good terms with them.”
What would your next question be to each of these answers? Anticipate.
Know what your doing
If you don’t know why I didn’t just ask where the owners are, then you need help. Often, asking the direct question will get you nothing but apprehension, while asking an indirect question seems harmless and is answered.
Ideas:
“If an emergency occurred, how would the owners know about it?”
“The home does not seem lived in.” An observation like this begs the neighbor to say, “Yes, they left.” To which you say, “Oh, that sounds interesting.” You are enticing the neighbor to shed information. You are not asking “Where did they go?” Answering is like squealing and no one likes a rat.
What’s next?
Most would tell any Wannabe investor to get a mentor. They are correct. Coach Mitch does mentoring in tax delinquent property. This is what my typical mentoring session is like, role playing. When dealing in human situations, like trying to explain a contract clause; to have success, proper human interaction is mandatory
Consider calling me, as I like conversing about real estate investing more than any other subject.
See Coach Mitch’s “Ridiculously Simple System…” ™ for details.
Good luck to you,
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