What do you require of New Investors that contact you !?

Asked by Helene Moore, Henderson, NV Sat Sep 10, 2011

What do you require when several requests are made from potential Realestate Investors who contact you and request several market comparables and other time consuming information. We don’t want to risk giving out to much time consuming information only to have the potential client work with another agent.

Helene M Moore
Windermere Prestige Properties

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20
John Souerbry, Agent, Fairfield, CA
Sat Sep 10, 2011
BEST ANSWER
Helene - I require a straight answer to 2 questions: 1) "Are you currently working with another broker?" 2) "Are you offering me the opportunity to represent you in the purchase of this property if the information I provide supports a decision to make an offer?"
These are my gateway questions that must be answered before I can provide any information or get into client screening questions such as financial qualification, exclusive buyer rep agreement, etc. If the investor is currently working with another agent, our conversation is done. If he/she has no intention of using me to purchase the property, I have no trouble quoting my hourly rate for market research. If the investor won't pay for research, the conversation is done.
5 votes
Annette Law…, Agent, Palm Harbor, FL
Sat Sep 10, 2011
Excellent response John.

Recently, a Trulia participant posted this "Looking for hungry Real estate agent willing to submit 'low-ball' offers for me." If an agent responded and consequently made not $$$, whose fault would it be?

Recent investor asks, "How can I determine market value for the home at 123 Maplewood Dr, myself."

Another investor, fresh out of the similar is asking, "Where can I buy bank owned homes?"

As these example indicate there are 'time-holes' on both sides of the equation.
It's not a hobby, it's a business.

Investor, if you want to work with me, we will need to have a contract in place. You are just a buyer. Your yellow pad endows you with no special ability, privilege or right. But if you do choose to work with a professional, you should be prepared to treat them with the respect and honor that should be extended to all people. You are just a buyer with a different set of criteria.

In response to Helene question...."A contract."
4 votes
John Souerbry, Agent, Fairfield, CA
Sat Sep 10, 2011
Scott - you bring up a good point. With all due respect to the many fantastic agents who make 7 figure salaries doing "owner occupied" deals (and there are many who are my friends here in Silicon Valley), most agents don't have the training to work with investors. The key phrase for an investor is "underwriting the deal." Based on my personal experience, Scott - you're right, most agents don't know how to underwrite an investment deal. They can't write an Offering Memorandum for an investment property listing or do preliminary underwriting for an investment property buyer. Agents who deal frequently in investment properties pick up specialized training and have the tools to do preliminary underwriting, which is a service investors expect. I do a very complete underwriting package before I present an opportunity to an investment buyer, partly for the benefit of the investor and partly to protect myself from liability if the deal turns out to be a dog. My investment listings are presented with a detailed Offering Memorandum and related disclosures (see my current Trulia listing, which is in negotiation and should be under contract next week).
Some agents, when contacted by an investor, should consider making a referral...
3 votes
Scott Hulen, , 64068
Sat Sep 10, 2011
I do like John’s straight answer to your question as far as a prequalification goes, but there is a flip side to this that all consumers / investors should ask: are you the agent qualified and dedicated enough to service me and fulfill my needs? (80% of agents are not qualified to work with investors) Investors will consume much of your time, 20-30 hours per transaction, or if they do 20 transactions per year that’s about 25% of your work week.
First rule of working with investors, success breeds success aka everyone makes money! Seasoned investors are extremely skeptical of real estate agents; they are much savvier then the general public, they are usually crass and generally think they know what they want. The frankly they don’t trust agents because they believe it’s the agents job to “sell” they don’t want to be sold but they want to be made aware of opportunities and they want the agents input only to a certain extent in regard to the negotiation of the deal. If the transaction goes well then they begin to build trust with the agent, it usually takes 2 to 3 successful flips before trust and a good relationship begins to gel. Don’t even try working with an investor if you are a part time agent, investors are very demanding and they desire you to work as hard as they work; meaning 12 hour days when needed, many are smarter than most agents they know the codes, inspectors, title companies, other agents, city officials and lending companies, they are networked. When working with an investor personality plays a big part so it’s important to find a good fit because no one wants to fake it for years and years this is a long term deal. Other upsides to investors are they provide steady income; the downside to investors is you get to submit a ton of paperwork of which half or more goes in the trash on 30-70k properties. (aka low commissions) The upside to submitting a ton of paperwork is now you are the office expert at hometelos and many others, plus now you are practicing real estate and not writing 2 deals a year. (You get good fast when you write 40-50 contracts per year) As an agent the experience you gain will serve you well with your other clients and will give you a HUGE edge over other agents.
3 votes
James Deskins, Agent, Worthington, OH
Fri Sep 16, 2011
I require them to contact somebody else.....heh heh
2 votes
Brian Rayl, Agent, Dallas, TX
Tue Sep 13, 2011
Hey Helene,

My questions (Usually in this order):

How long have you been investing in real estate?

Do you rent or flip?

How many homes are in your investment portfolio?

Are you incorporated or do you operate under an LLC?

If we decide to work together, do you have any problem sending me your article of incorporation/organization?

Can you show me a proof of funds, company line of credit, or preapproval letter from a lender?


I am guilty of responding to some of those "low ball offer" investor posts recently. I have no problems submitting lowball offers if they are serious buyers with the ability to close quickly once an offer has been accepted. I work with several investors and they all have different styles, investment objective, and needs. If they can prove to me they are serious, then I will work with them.

It's more than real estate. It's RAYL-Estate!

Brian Rayl
Keller Williams Elite - Dallas, TX
972-949-4222
Brian@Rayl-Estate.com
http://BrianRayl.com
2 votes
Dorene Slavi…, Agent, Torrance, CA
Sat Sep 10, 2011
Dear Helene,
I have certain criteria and screening I perform with all "potential buyers". If a client comes to me who is not referred by another client or agent who I know well. That client must come into my offices to discuss their investment plans in person. I ususally hold a lengthy interview process with all personal and financial information disclosed and discussed. I normally invite an investment banker, or other bank personnel who will collect all the vital informaiton at that meeting as well.
If we feel we can work together successfully we can then go on to signing exclusive Broker contracts and after that time I will begin working.
There has been some discussion (and rightfully so) for investors who do not want to work under a formal contract, to pay an upfront retainer fee depending upon the amount of work that is requried and requested of the professional and licensed Realtor.
2 votes
David Cooper, Agent, Los Angeles, CA
Sat Sep 10, 2011
"- I require a straight answer to 2 questions: 1) "Are you currently working with another broker?" 2) "Are you offering me the opportunity to represent you in the purchase of this property if the information I provide supports a decision to make an offer?""
Great start. I also try tio find out if they really believe they can low-ball every bank reo because they just came from some seminar that told them banks are accepting 50 cents on the dollar. When they tell me they will find an agent that will, I end the interview.

David Cooper Foreclosure Specialist with 35 Years Investing Experience. Receive a FREE List Daily of Low Priced, Houses in Good Areas with Greay Cash Flow 10.0% + CAP RATE GO To Website or Call +1-702-499-7037
2 votes
Mack McCoy, Agent, Seattle, WA
Fri Sep 16, 2011
That was funny, "James!"

David, good point about the "investment seminar" grads.
1 vote
David Cooper, Agent, Los Angeles, CA
Mon Sep 12, 2011
Investors who understand that there is no secrets "wholesale" deals that some seminar taught them about. Experienced agents can get great bargains with good research, and finding houses in good areas with the right things wrong. If the investor thinks they know more than me, I pass them on to the next agent.


Investors expect to make money on their investments and hire the most competent representative they can find. IAll I can offer is experience and success.


David Cooper Foreclosure Specialist with 35 Years Investing Experience. Receive a FREE List of Low Priced, Bargain Homes in Good Areas with Great Cash Flow 10.0%+ CAP RATE. Go To http://www.lasvegaswinner.org or Call +1-702-499-7037
1 vote
Angel Whalen…, Agent, Las Vegas, NV
Mon Sep 12, 2011
BUYERS/ BROKER agreement.
You are working for them, they should want to show some commitment to you also.
Also, PROOF OF FUNDS Serious investors will be able to provide the funds to back up their request
1 vote
David Cooper, Agent, Los Angeles, CA
Sat Sep 10, 2011
"TIME-HOLES" Annette from Palm Harbor, Fl just expanded my real estate vocabulary. Fit's 90% of the late night TV seminar investors who think agents get paid for presenting offers.


David Cooper Foreclosure Specialist with 35 Years Investing Experience. Receive a FREE List of Low Priced, Bargain Homes in Good Areas with Great Cash Flow for Invstors GO TO website or CALL +1-702-499-7037
1 vote
Matthew D'Er…, Agent, Las Vegas, NV
Sat Sep 10, 2011
They must provide pof or no laundry....then move on.
1 vote
Bill Eckler, Agent, Venice, FL
Sat Sep 10, 2011
1. realistic expectations

2. seriousness of purpose

3. means

This is a great question and one that deserves consideration because there is no shortage of self-declared investors that haven't the "foggiest." Unless we have a means to seperate the well-intended from the others valuable time and energy can easily be wasted.

Thanks,

Bill
1 vote
allan erps,A…, Agent, Pearl River, NY
Mon Sep 19, 2011
Let me see your proof of funds before we make any offers!
0 votes
Renee Burrows, Agent, Las Vegas, NV
Mon Sep 19, 2011
I don't work with them because in general they are too much work and they are all working with lots of other agents. Not really worth my time.

If they "insist" that I "must" work with them then I offer a consultation flat fee structure. No takers yet.
0 votes
Brian Rayl, Agent, Dallas, TX
Fri Sep 16, 2011
Hey David, thanks for responding.

I never said that I don't work with the unexperienced investors. On the contrary, some of my best clients have been the unexperienced. But this line of questioning allows me to gauge exactly how experienced they are and allows me to tailor my presentations, investment packages, and time to their needs.

The average real estate investor earns less than $75,000 per year household income from their primary job. Everyone has to get a start somewhere.

It's more than real estate. It's RAYL-Estate!

Brian Rayl
Keller Williams Elite - Dallas, TX
972-949-4222
Brian@Rayl-Estate.com
http://BrianRayl.com
0 votes
David Cooper, Agent, Los Angeles, CA
Wed Sep 14, 2011
I think the investor looking at $70,000 dollar homes, and paying all cash needs to be represented a little bit differently than what e some of the answers from agents in other cities. Texas and Mass is NOT Las Vegas.


David Cooper Foreclosure Specialist with 35 Years Investing Experience. Receive a FREE List of Low Priced, Bargain Homes in Good Areas with Great Cash Flow 10.0%+ CAP RATE. Go To http://www.lasvegaswinner.org or Call +1-702-499-7037
0 votes
Tom and Joan…, Agent, Boston, MA
Wed Sep 14, 2011
Helene:

Brian has it right and we must not be afraid to ask questions. We have to qualify every single person we decided to work with. Take time away from family or other motivated clients for an unmotivated client and you lose. Additionally, you can ask for a non-refundable deposit that is credited at closing for services rendered. Best
0 votes
David Cooper, Agent, Los Angeles, CA
Wed Sep 14, 2011
Brian: I really enjoy and have had great siuccess working with the least experienced investor. They are more open to learning and once you show them the kind of returns good rental real estate had had in previous investments, you have a very wiling buyer. It's amazing how the money shows up when the deal makes sense.

David Cooper Foreclosure Specialist with 35 Years Investing Experience. Receive a FREE List of Low Priced, Bargain Homes in Good Areas with Great Cash Flow 10.0%+ CAP RATE. Go To http://www.lasvegaswinner.org or Call +1-702-499-7037
0 votes
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