Always Do Right By The Seller
By JD Esajian on November 22, 2013
According to an old adage, “what goes around comes around.” While cliche, this is particularly true in the real estate industry. When you are working with sellers, especially in a distressed situation, it is important to always keep this in mind. The reality is that most homeowners really don’t know what is going on with their property. It is almost always beneficial to respect their situation and help them accordingly. Instead of trying to steamroll the owners into working with you on a quick sale, try explaining the process to them and giving them all of their options. You will find that people in the business will notice your approach. For every deal you lose, you may gain five more because of how you took care of a previous seller.
As much as homeowners are unfamiliar with the process, it is not that difficult to find information pertaining to their situation. You may think you have a deal secured, but you will be in for quite a shock when they back out at the 11th hour. Between loan modification, short sale, HARP refinances and deed in lieu of foreclosure, the homeowner does have options. Give them all of these options and the best ways to find information out about them. Some may not be available for them, but let the homeowner do their due diligence and come back to you.
If the homeowner does come back with a loan modification or a refinance option that is better for them, don’t stand in their way. Help them review the estimates and options to determine if it really is better for them. If so, wish them the best of luck. If they need anything from you in the future, have them give you a call. They will surely appreciate your honesty and integrity. At the very least, this approach will lead to a positive referral. You never know which homeowner has a family member that is in real estate or knows an attorney who they can tell. With the way things spread on social media, doing the right thing can spread very quickly. Before you know it, you have established a great reputation that can help you gain more deals.
You may find that if you push a homeowner too fast or too quickly, they can become skeptical and eventually back out of the deal. Even if they are in foreclosure, they really don’t have to sell. You can spend months going through the buying process, pulling title and spending money only to find that the seller had a change of heart. This could have all been avoided if you gave them these options up front and thought about what is really best for the homeowner.
The most obvious way to handle this is to discuss what the homeowner’s goals and expectations are for the transaction. If they are looking to walk with a significant amount of money, and that scenario is not possible, you need to kindly explain their situation. Most times, the homeowner really won’t know what their options are and is looking for advice. If you are not an attorney, never give legal counsel. However, if you know the short sale or foreclosure process, share that information with the seller and never leave anything out.
If you treat sellers like you would a family or a friend, you will find that you will retain more deals that you work with. Even the ones you don’t could end up having a silver lining. If you do right by the seller, you will find that eventually the good karma will come back to you.