Has Anyone Developed A Good Buyer Prospect Screening System?

Asked by Chris Hutchinson, Hurst, TX Wed Apr 11, 2012

As you know we are always recieving calls from prospects that claim they are ready to buy a home and once you start working with them they tend to decide to hold off or can't do it any longer. What are some process that you are using to increase the chances of getting to the closing table with a new unknown prospect?

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8
Annette Law…, Agent, Palm Harbor, FL
Thu Apr 12, 2012
BEST ANSWER
Without these three you have nothing.
Motivation
Ability
Date

Without understanding ALL three you have, by default, a time hole. If a contact is unwilling to invest a little skin, (simply a meeting) you have all the information needed.

Now, the following question you presented, "What are some process that you are using to increase the chances of getting to the closing table with a new unknown prospect?" has way too many dimensions.

Even motivated, time sensitive buyers with the ability to buy encounter situations that are unforeseeable or were ignored by the financing institution from the very beginning. Appraisal, insurance, hidden liens, community litigation, the list goes on and on and on and on. There is no means to sort, identify or prevent these casualties.

When you do the analysis of leads to closing table ratio, the light will truly turn on regarding the business you are in. It may look something like
500 leads - 10 contacts
10 Contacts = 5 clients
5 clients = 1 closing table.

The one and five closing ratio has not changed in decades. Every now and then we experience a hot season where more than 20% make it to the closing table. Sometimes this is the result of choosing not to dwell on the loses, but on the positive aspect of the business.

Best of success to you.
1 vote
John Souerbry, Agent, Fairfield, CA
Wed Apr 11, 2012
I agree with Mack's approach - meet with them ASAP to get the lowdown on what they need. I have an abysmal conversion rate on online leads because my first response is to set an appointment in person. Once I make that request 99.9% of leads evaporate. But then I have plenty of time to continue marketing and to serve real clients.
3 votes
Mack McCoy, Agent, Seattle, WA
Wed Apr 11, 2012
I have a meeting with them, in my office, to discuss their goals, plans, timelines, and motivation.

I think you need to know - what they're looking for, where they're looking for it, how they're going to pay for it, when they're planning to move in, and why they're planning to buy.

So, ask them. "When do you want to be able to move in." They will tell you - we need to be moved in by start of school; or, we're not in any hurry, we'd just like to wait for the right house to come up.

You also want to understand their motivation. If their motivation is simply to get a great deal, you could be showing them houses forever. If their motivation is to take advantage of a vacation slot to move in, you know you have a motivated buyer with a strict timeline to work with.

The problem most agents have with asking questions is that they think they'll lose the prospect. But, you're the professional - how can you serve them when you don't know what they're trying to accomplish?

All the best,
3 votes
Jeanette Bell, Agent, Saint Louis, MO
Wed Apr 11, 2012
I am a big believer in getting things accomplished by working with my buyers and sellers as a TEAM. Find out the potential client's motive. Sign a Agency Agreement, and make sure you have a good lender to recommend so the buyer can be pre-approved. If this is a cash buyer, request proof of funds at your initial meeting.

Ask questions and LISTEN to your clients. Trust your instincts. Even if the client you've been working with chooses not to buy, hopefully you have established a good relationship with them so they will call you when the time is right! This business is about building a pipe line and having a great reputation amongst the community.

Good Luck
1 vote
Blake Harris…, Agent, Dallas, TX
Wed Apr 11, 2012
For me it's about building rapport with a buyer first, establishing a relationship where they will be honest with me. I find it's several steps to get to the truth. Before showing a buyer the first home, I "qualify" how they determined that a particular home is in the "price range." Their answers guide me to determine if they have owned before or not, and if they have been using "online" mortgage calculators. If they are not already pre-approved, I wait until I've shown them 2-3 homes. That way, I have shown good faith, that I want to work with them, and am trusting of them to be honest with me about being "ready, willing, and able" to purchase.

However, before I take them for more showings, after the first few, I meet with the buyers at my office to discuss "hiring me" by presenting the Buyer's Rep Agreement. I personally ask for a small amount of money upfront (this also gains commitment for cash buyers), that will be a credit to them at closing. At that time, I establish a date by which they will make full loan application as part of our agreement to work together. If they are unwilling to do that, or don't do it by the agreed date, it allows me the opportunity to determine how much of my time they will receive, if any.
1 vote
Bruce Lynn, Agent, Coppell, TX
Wed Apr 11, 2012
You have to map out their motivation and deadlines.
Of course people can change their minds, get nervous, lie, etc.

Getting prequalified with a good lender is key.
If they won't get prequalified, that typically will clue you in.
You need to also find out when they need to move and why.
Is it compelling....like I gave notice, they rented my apartment already and I need to be out in 59 days.
That's motivation.
My grandfather died with no will and I know he was loaded, so I should get a nice cut soon.....ummmm iffy....someone to put on a drip campaign to call you when the cash is in hand.

Do you have a great lead generation system? Do you have great scripts?
If not we'd like to talk to you and help you get on the right path.
We're right here in your neighborhood with lots of resources to get you selling more real estate.
Web Reference:  http://tiny.cc/RECareer
1 vote
Tim Moore, Agent, Kitty Hawk, NC
Wed Apr 11, 2012
Have them get prequalified by a lender. That should weed out a lot of them.
1 vote
I done a lot on the lender pre-qualify that has saved me some time. I guess the hope is for more people that can actually qualify. I wanted to check for best practices to see if others are doing the same thing. Or if someone though of something better.
Flag Wed Apr 11, 2012
Jerome Simon, Agent, Dallas, TX
Wed Apr 11, 2012
So the question is ..

How does one automate the process of learning people's true motives? There was a movie about though police a few years back. I think it was called "Minority Report".

Other than that, it appears that a professional agent has no choice but to serve. When one has a pre qualified, ready, willing and able client.
0 votes
I'm not trying to read peoples minds obviously. In most sales professions I have found the very best have some type of system in which they work their prospects. I am simply trying to inquire about what processes others use to increase the probablity of closing more so than shuffling around town showing houses to whomever may call praying they will get to closing.
Flag Wed Apr 11, 2012
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