Many times as you negotiate with sellers, you’ll find they are negative and don’t trust you. The first important step is to sit down face to face with them because then you can actually ask them questions to find out what will make them happy. You can’t just say “Will you take seller financing terms?” or “Will you do this or that?” They have to like what you’re offering more than what they’re giving up or the transaction will never take place. Show them why doing business with you is better for them.
T-BAR is one of the tools I was introduced to years ago. On a piece of paper, I draw a line across the top and a line down the center as I’m sitting in front of the seller. On the left-hand side, I list the seller’s current position. On the right-hand side, I show the potential if they accept my offer. If the seller is paying a mortgage, I put that on the left side. On the right side, I list $0 because I’d be paying the mortgage. I do the same with property taxes and insurance. Then I go on to any other maintenance they might be paying for like lawn service, pool care, etc. What I show them is the swing in the monthly cash flow that would take place if they sold me the property. Once they see it all together on paper, they are often surprised at how much money they’re spending every month.
If it’s a rental property, they might not be as open to the idea. But you can show them the money they will save from not having tenant issues and having to pay eviction court fees. They also would save on plumbing, electric, water, garbage, snow removal if they’re in the north.
This secret of T-BAR is a tremendous tool that will help you buy numerous properties. I hope you find it as useful as I have. To discover more tips and tricks on becoming a successful real estate investor, register on my site to receive updates and information.