Transcription
After releasing our video on how to find cash buyers online for free, it became apparent that our YouTube community knows now. But the number one question we keep on getting is, "How do you talk to cash buyers now that you find them? How do you talk to cash buyers? Find their buying criteria so they're ecstatic to pay you wholesale fees for the deals that you bring them?"
So in today's video, I'm going to cover exactly how to talk to cash buyers. In fact, I've got my Cash Buyers Script here, that you can download for free. Link in the description. We're going to cover the questions in here that you want to cover, so you can get your cash buyers' buying criteria, and so you can find the exact deals that they want. Most wholesalers, the amateurs, they'll go find a random deal and then they'll try and fit that into the cash buyers' buying criteria, when they don't even know what that is. So, instead, we find your exact cash buyers' buying criteria—exactly what they want—and then we go find those deals. Now the chances of you wholesaling that deal are so much higher. You're going to get the largest wholesale fee possible and build an awesome relationship, and there's going to just be a lot less stress in your relationship.
All right, so let's say you watched our video. You know how to find cash buyers online for free, or maybe you met a cash buyer at a networking event in person. Let's dive into the script on how you can start the conversation, the questions you want to ask them so you understand their exact buying criteria, and also how to end the conversation so that you now know the exact deals that they want, and you can bring those exact deals to them.
Here's exactly what you can say to start the conversation: "Hi, my name is Alex and I'm a real estate investor in the area. I actually wholesale property in San Diego, and I have access to properties for sale below market value. Would you be open to doing business together by any chance?" All right, so plug in your name for when I said Alex and your city name for when I said San Diego. That's a perfect starter on how to talk to a cash buyer, because you're telling them you can find properties below market value. You're telling them you're a real estate investor and a wholesaler, and if they're open to doing business together by any chance. That's exactly what a cash buyer wants, and that's how you're starting your conversation.
So we've gotten the question a lot: "How do I start a conversation? What do I say? Do I tell them I'm a wholesaler or not?" Yes, yes, yes, yes. And really the only person that needs to know you're a wholesaler is your cash buyer. Of course, you want your cash buyer to know you're a wholesaler, because what do they want? They want deals. And what do you do as a wholesaler? You bring them deals. So we just accomplished a lot in the first sentence. So everyone here, the whole entire YouTube community, practice this script, practice that intro. Use that sentence when you start having a conversation with a cash buyer in person or on the phone. They'll most likely say yes or they'll be curious. I don't have a script for you to tell them about yourself. Okay? Tell them where you live, what you're interested in. There's a great book called How to Win Friends and Influence People that you can pick up if you want to learn how to build rapport.
But the most important thing that we need to do now is to now start to understand exactly what they want to buy. I'm going to go through the questions that you want to ask, so you can find the exact properties they want to buy, what they like, what they don't like, and now that gives you permission, that gives you the ability to go find those deals and then bring those deals back to the cash buyer and wholesale them.
So the first question you want to ask the cash buyer is, "What areas do you like to buy property in?" So I'm talking zip codes, neighborhoods, cities, and when they tell us the exact zip codes that they want, when they tell us the neighborhoods that they want, now we're able to go find deals in that exact area. And we're not finding deals in the boonies or deals in a rural area or deals in three counties over that they don't want. All right, this is what I like to call working smarter rather than harder. A lot of people think they need to find a random deal, and then hopefully it works for their cash buyer. Instead, we eliminate all hope and we create certainty by knowing exactly where your cash buyers want to buy property. Now, a lot of the times, these cash buyers, they'll probably buy in your whole entire county or have some favorite neighborhoods or cities, so this question's perfect. And just don't assume. The point of asking these questions is so you don't assume that they're going to buy in the whole county, because no one likes when you assume. I can't say it makes an (censored) out of you, you know what I mean? So we're not assuming that we know where the cash buyer wants to buy. We're asking them exactly the areas they want to buy in. And so when we're asking this question, just keep in mind that different cash buyers are going to have different preferences. So what you want to do is actually record this down. I recommend just using a spreadsheet. You can use a Google Spreadsheet, your spreadsheet on Excel, and just record the answers to these questions so you keep a log of your cash buyers' list and know what your specific cash buyer wants, each one wants.
Okay? And now for the next question. You want to ask the cash buyer, "What price ranges do you like to buy property in?" All right, because there are some cash buyers that say, "Hey, I'll buy anything under a million dollars." There are some cash buyers that'll say, "I'll buy anything from 250,000 to $500,000." And now that we know the area, the zip codes they want to buy in, now we know the price points in. And each cash buyer is different, once again. Some will put a cap on the purchase price of a house. Some people will buy multi-million dollar properties and some won't. So when you ask these questions, now you're starting to paint a picture. You're starting to get a very clear visual on what they want now.
And here's another one of my favorite questions, too: "What's your ideal property? And what's your ideal property? What's your bread and butter?" Because now they're going to tell you exactly what they want, their favorites. They're going to be racking their brain on the type of property that they want you to bring them. Some cash buyers may say, "Hey, I just want a three-bed, two-bath, 1200 square feet, easy, just cosmetic fixer." Some cash buyers may say, "We love building ADUs," Accessory dwelling units. Or, "We love adding square footage to a property. You find me something that's 900 square feet and I can add 500 square feet onto it, and it was a two, one, and I make it into a three, two. That's our jam. That's our bread and butter." Now we're getting them excited. We're seeing what they like. These are great questions to have them give us information. As you can see, it's going to help them to open up.
And now the next question you can ask is, "What types of properties are you looking to purchase?" Right? "Houses, condos, mobile homes, multi-family?" I recommend, if you're starting out, don't try and wholesale land and multi-family and office space and all this stuff. Focus. Focus on one thing, and I recommend focusing just on houses. There are an abundant amount of cash buyers out there. Just focus on houses, just one product. No one is successful chasing multiple rabbits at one time, right? We're finding cash buyers utilizing the methods that I've taught you: How to Find Cash Buyers Online for Free. We know they like to flip houses. But when you ask this, they may tell you something about town homes or condominiums that they also love as well. Might be a niche for them that you didn't know about, and they say, "Man, we just bought five condos this last month." So this is a good question. Get them to open up so you can find those exact deals that they want, okay? So, "What types of properties are you looking to purchase?"
Then we can get into, "What type of work are you looking to do to the properties?" Cash buyers, they're all not created equal. There're different levels to this game. Someone just starting out as a real estate investor, just starting to fix and flip, probably aren't capable of doing a $100,000 renovation, a full gut job with the crack slab and something that needs a new roof. If someone's starting out, they probably want to do minor cosmetic work, maybe something $20,000 to $40,000 tops. So, when you say, "What type of work are you looking to do on properties?" We're seeing what they're comfortable with, because, once again, you talk to an advanced real estate investor, they could say, "Man, give me anything and everything. If I've got to scrape the house and build a new house, I'm in." This is a conversation, either on the phone or in person, and you need to catalog this information because each buyer is specific.
Now, here's another really important question: "What's your minimum profit or ROI you need on a deal?" Not everyone uses the same formula to fix and flip a house. The best cash buyers I know do not use an MAO formula. They have their own spreadsheet, they have their own calculations, they have their own estimations on the types of deals they need, the types of profits they need, and the types of ROI they need. So when you ask this question, you actually get to talk to the cash buyer and see through their eyes, their lens. They can tell you exactly what they're looking for. Some may say, "Hey, for what I put into the renovation, I want to get out in profit." So if a fix and flipper puts in $50,000 in renovation, they want $50,000 of profit. Some may say, "Hey, I want a 10% cash on cash return." So if they put $300,000 in the deal, they may just want $30,000 back. Some may use an MAO formula: 70% of the ARV, minus your wholesale fee, minus repairs, in order to get the profit that they want on a particular deal. And what's most important with this question is that you need to understand that you're coming from a place of service when you're asking this question, because there's a lot of people that are going to hear what I'm saying and aren't going to do it because they're afraid. They're afraid to talk about money, an ROI or profit, but, at the end of the day, you need to know what the heck your cash buyers wants. And if they say, "Hey, I need a 15% ROI," say, "Great. How do you calculate that?" Don't just take things at face value. They say something and you don't understand exactly what they're saying, say, "Hey, can you explain that to me?" A lot of people think that, when people throw out percentages and numbers and formulas, that if you're advanced, you just understand what it is. I'm here to tell you the truth. I've been doing this for 10 years, and if someone says, "Hey, I want 15% ROI on a deal," I'm going to say, "Great. How do you calculate that?" Every single time. Doesn't matter if it's a fix and flip deal or a wholesale deal, a commercial deal we're investing in, I want them to tell me the calculations they're using on a particular deal. So this is why this type of deal is so important, and what you're also going to be able to do is you'll probably be able to weed out some people that are jokers. There's going to be people saying, "Oh, I want $250,000 of profit on each and every deal. I want 50% ROI." Those are red flags going off in your head. It's a little unrealistic in some sort of ways.
So, as you talk to multiple cash buyers, you'll probably see some consistencies. And if you do your research and you find cash buyers the way that we've taught you, you'll be able to see cash buyers that have done hundreds of deals or thousands of deals, and guess what? When they tell you how they're calculating deals or the minimum profit they need or their ROI, they're probably onto something. The law of averages typically isn't wrong, and they're probably doing something right in calculating deals the right way. Don't weight all of the responses you get from all of your cash buyers exactly the same. Know that some are going to be at different levels, like I was saying.
All right, for the next question. Now that we know the types of properties that they want to buy, and the areas they like to buy in, if we need to dwindle down a little bit, just to understand areas they don't like, here's another great question. It's, "Are there any types of properties or areas that you do not like to purchase property in?" So, once again, we're taking the server approach, and you can jot these zip codes or these neighborhoods, these areas, down for areas they do not want to buy properties in. And guess what? Once again, talk to 10 cash buyers. You may see consistencies. You may find that there's an area where, if they fix and flip in that specific zip code, people steal the copper from their properties. There's a lot of homeless there. Or maybe that specific area is depreciating for some reason because they're putting a commercial development in there and it's going to take five years, and there's tons of noise and noise pollution. Just know this is another good question. Take the server approach to find areas they don't want to buy in, so you for sure don't bring them properties that are in that area.
And another one of my favorite questions is, "How many projects are you currently working on at the moment?" I like this question because you may find people that say, "Zero." And they may say, "Hey, I've never done a deal." And then you know, okay, this person's probably not serious. You may talk to people saying, "Hey, I'm working on 10 deals at a time." And that's typically the type of cash buyer that you want, someone that can buy multiple deals from you as a wholesaler, because now if you wholesale them one deal during the month, and you got two other deals, this one buyer could potentially buy all of your deals. When you're asking professional questions like this, this is what really any wholesaler should do. You should understand your cash buyers' buying criteria and look at it like we're getting their customer profile. We're starting to understand exactly what they want, and now we're starting to understand their experience level through asking this particular question. What we want to do, once again, we can't weight everyone the same, can't weight every cash buyer the same. If someone tells you, "Hey, I haven't done a deal at all in 12 months," that is not a serious cash buyer. Most likely not a quality cash buyer, because the best fix and flippers are doing multiple deals at a time.
Now, here's another great question. If it's not apparent, if it's not on their website, if they haven't communicated to you, this question is, "How many projects have you completed so far?" Projects meaning house flips. What we're starting to do here is starting to decipher the quality and experience of your cash buyer. Someone can tell you a thousand. There's cash buyers that have done thousands of deals. Some may say, "We did 50 deals last year." Some may, once again say, "Hey, we're doing five a month right now. We're on track to do 60 this year." We want people that are actively doing deals, because they're going to have their systems and processes in place. Why is it important to not treat every cash buyer the same? Because the cash buyers that aren't doing deals, versus the ones that are, you send them a deal via email that they could buy and pay you $10,000 on. The cash buyers actually doing deals can respond to you quickly and probably close on a deal within 24 to 72 hours. The cash buyers that haven't done a deal most likely aren't going to be able to close on the deal. This is just what we've seen throughout the years, that, if you send a deal to someone who's never done it, guess what? They have to evaluate it from scratch. And with that said, speed's the name of the game, so when we have a deal under contract and we're wholesaling it, we typically have three to seven days to wholesale this deal to our cash buyer. So, we want to work with the cash buyers that are doing deals that can respond to you quickly, within 24 hours, 48 hours, or 72 hours, not the people that have never done a deal. If you only have one buyer from someone who's never done a deal or only does one deal every 12 months, you're putting yourself and your business at risk. Do not do that. But instead, if you find three to five quality buyers, through asking these questions and talking with them, you're going to have a secure business, be good. You're going to have a plan A, plan B, and plan C. That's what you need as a wholesaler. Never rely on one buyer, and this is how you start to add more weight, start to see who's at the top of my list. And what you can do on your cash buyers' list where I told you to put this into a spreadsheet, start putting the ones at the top that you think are the best, through communicating with them. The people that are doing the most deals, that can respond to you quickly, that are buying in the most areas, these other buyers that you want.
And now here's another great question. This is a qualifying question: "If I bring you three great deals in the next months, will you be able to purchase them all?" I love asking this question, because this will weed out the people, and by this time, if you're asking the right questions, like we're saying, you may get a sense of this guy or this girl does not do a lot of deals. They do one deal every six months. This is a question so you have confidence in bringing multiple deals to one cash buyer, because what I've seen throughout the years, about 20% of your cash buyers will buy 80% of your deals. That's the importance of building a really good relationship. You can have one cash buyer pay you multiple six figures in one year for your wholesale deals. And so this question is validating that if you bring them three deals in a month, are they open to taking them? Can they take them? Do they have the capacity to purchase them all? All right, so great question. They may say, "Yes." "No, I can only do one deal a month." Okay, great. Mark this down, because, guess what? You wholesale them a deal in one month, they're not going to be able to buy another deal from you. So now you got to keep that in mind so that you're not solely reliant on just one buyer, right? It's about making smart business moves, having smart business practices. Cash buyers. We all need them.
So, as you can see, we're going really deep here. There's a lot of people who don't talk about these questions, and there's a lot of people that have a misconception that all cash buyers are created equal. They're not. So, through asking these questions, you're now qualifying them, and actually posturing yourself as an authority that can bring them deals. Take the server approach, because, with this question, "If you can buy three great deals in the next month or so, will you be able to purchase them all?" They may say, "One." "Two." They may say, "Three." "Hey, I can buy 10 deals a month." That's what we want to hear. That's why we ask this question.
Now, for the next question, here's another great one: "How many properties are you looking to purchase in the next six months?" So, we just want to understand their game plan. What's your cash buyers' game plan? They want to buy 10 properties, 18, 24, 50? What are they looking to do? Because now you can understand their goals and you can align yourself, your business, with their goals. The more deals they do, the more money you're going to make, and we want to work with people that are A-players in this game. You don't want to work with a cash buyer who just wants to do one deal in a month. I wants to do five, 10 deals a month, because they're going to buy multiple of your deals, and that one cash buyer can pay 50 to a hundred grand a month if you consistently bring them deals. So, "How many properties are you looking to purchase in the next six months?"
All right, and for the next question, it's, "What's your financing source for these deals?" Right, how's your cash buyer bringing the money to buy these wholesale deals? Is it cash on hand? Is it hard money? Is it private money? Is it a bank loan? Do they have JV Partners? If you ask this question and this cash buyer says, "I don't know."
Understand that that is most likely a red flag, and understand that you don't need to ask this question to every single cash buyer. If you looked at their website and they've obviously done a thousand deals in the last three years, they have access to the capital and the cash. You don't need to ask this question. This is moreso a good question if someone's not passing the sniff test, someone hasn't done a lot of deals or any deals at all, and you want to make sure they have access to that capital.
So, once again, someone says, "I don't know." Red flag. But if someone says, "Hey, I got a million dollars in the bank," or, "I have access to $3 million of private money," or, "I have great relationships with hard money lenders that are ready to go right now, and I have the down payment to put in the house," then we know they're serious. So, just know, if someone doesn't have an answer to this, red flag. If they do, typically good.
And for the last question, what I like to ask is, "How quickly can you close on a great deal that I bring you that fits your buying criteria? One day? Within a week? Two weeks? One month? Two months?" Once again, we're just dwindling our funnel down. We are just refining and refining and seeing the people that can say, "Hey, one day. Two days. Three days. A week." That's how fast we want to move. If someone tells you, "Oh, I need three months," red flag. Because when we put deals under contract, if you checked out my training at realestateskills.com/training, you know we're wholesaling these deals pretty quickly once we put them under contract. And, typically, we're wholesaling them within three days before an EMD is due or within seven to 10 days before our inspection contingency is due. So we got to make sure that that's what we're doing. We're putting these deals under contract. We need to have cash buyers that can close on a great deal quickly. We need cash buyers that can close in two weeks or less, and if they can close in one day, which, the best of the best cash buyers absolutely can do, 24 to 72 hours, that's your ideal buyer. That's exactly what you're looking for.
And now we want to end the conversation. We can say this to the cash buyer, so, "When I reach back out to you, when I have a great deal that fits your buying criteria, can you please just respond back to me as quickly as you can? Just because these deals go quickly, within a day or two. I don't want you to miss out on a great deal. Does that sound good?" Most likely you'll get a yes. They may say, "Hey, it'll take me three to five days," or, "I'm going on vacation in two weeks." Basically, we're just trying to get a confirmation, a micro-commitment here, to end the conversation on a high note. And now we can end the conversation with, "Okay, great. Thank you for your time. It was great meeting you, and I look forward to doing business with you soon."
With this script, with the intro, with the questions, with the conclusion, you now have 10 years of wholesaling real estate experience in your hands. You can get this Cash Buyer Script at realestateskills.com/cashbuyerscript, and now you can go out with confidence in the world. You can watch our video How to Find Cash Buyers Online for free, and use this script, and now talk to cash buyers. And, once again, if you need a wholesale property, check out our free training at realestateskills.com/training, and I'll teach you exactly how to do that, how we and our students have been doing this for 10 plus years on wholesaling on-market deals with real estate agents without spending $1 in marketing.
Hope you enjoyed today's video. If you have any questions... Because we made this video because of the questions the community had. This was the number one question that we saw over and over and over again, so if you have more questions, definitely let us know and we'll most likely make a video on it, just like we did on this one. And it was Zig Ziglar who said, "You help enough people get what they want in life, you'll get everything you want in life." So take that server approach with the Cash Buyers Script when we're talking to cash buyers. Find out exactly what they want, so you can bring the exact deals that they want to them, and guess what will happen? You'll make the largest wholesale fees possible. You'll have the best year wholesaling real estate that you've ever had. Please be sure to check out our other videos, and please like, subscribe, hit the notification bell, because I want you to be notified when our next videos are coming out. All right, I'll talk to you soon. Alex Martinez here, founder and CEO of realestateskills.com. Happy wholesaling.