By Craig Forte, Executive Editor
One of the biggest mistakes new or struggling agents make is they spend too much time pursuing low quality leads. They believe that working with any prospect is better than no prospect at all.
Problem is, unqualified prospects rarely turn into income-producing clients. Nothing is more frustrating than investing large amounts of time, money, and energy with buyers who ultimately flake-out on you, get cold feet or end up working with another agent.
The secret to maximizing your income per hour practicing real estate is to “qualify” each buyer lead that comes across your desk before spending your valuable time with them. And the ONE item you want to qualify is…
Their True Motivation to Buy
How do you understand buyer motivation? By simply asking the right questions, then close your mouth and listen carefully.
Here are 7 “motivation-detective” questions you can use to screen buyer leads (some of them will work for sellers too). They can be used as a “phone script”, in person or even by email…
1. Why Are You Thinking of Buying?
Determine their legitimate reasons for buying: Move-up, empty nester, retiring, first time home buyer, investment, relocation, job change, lost job, etc. It also gives you an early indication if they’ll be a good client or a “time-waster.”
Also look for the “common connection” with the caller (kids go to same school, go to same civic organization or church). When you find something in common, or discover specific needs, communicate how you share the same interest, or have a specialty in what they need.
Your goal with this question is to begin building a relationship. While they’re talking about their life situation, identify a bridge to your unique services…how you can help them with their problems. As the conversation progresses, you can use this information to convert them to an appointment, that is, if you conclude the lead is a motivated buyer.
2. What Type of Property Are You Looking For?
This question identifies multiple things at once that you may not realize at first glance. If you ask this question and the response is that the potential buyer is looking to invest in a foreclosure…
- You can identify in your mind where you might look for foreclosures in your market area and how long it might take…
- You can identify how you might be able to help them (if your expertise is right for them)…
- And you can identify if they are realistic in their desires.
For instance, an unrealistic buyer may want to buy a foreclosure that needs some repair work to get a better price, but doesn’t have any extra money to do the repairs. You’re job is to identify any disconnect that could lead to you wasting your time.
You’ll end up frustrating them (and make yourself look foolish) if you show them homes that require no repair work but are out of their price range. Or, just as bad, showing them homes they can afford but that need immediate repairs (for which they don’t have money).
Don’t worry about getting every last detail of their search criteria now. You’ll get more information from them if you meet in person. Your critical objective is to see if they are motivated, realistic and a good client that provides a paycheck and not the run-around.
3. How Soon Do You Want To Be In Your New Property?
If it doesn’t come up in the discussion from the last two questions, ask this qualifying question to determine the time frame of the potential buyer.
You can also ask, “How Long Have You Been Looking?” If they’ve only been searching for a couple months and don’t have an urgent reason for moving, they’re probably not motivated enough to commit your most precious asset: your time.
If the prospect doesn’t want to move soon (generally in the next six months), you’re wasting your time meeting with them in person. You can still put them on your contact database, give them market updates, and send them your regular monthly newsletter… keeping in touch and developing a RELATIONSHIP with them until they’re ready to buy.
Wait to meet in person at a later date once their time frame is less than six months.
4. Have You Bought A Property In The Past?
You’re trying to gauge if they are familiar with the home buying process. Understanding how knowledgeable they are will allow you to better communicate your value in helping them in their search.
You may already know the answer to this question from prior discussion with the prospective buyer. This is a golden opportunity to highlight common problems and frustrations with the home buying process and to present your unique solution.
If they’ve bought a home in the past where the process seemed overwhelming and they didn’t think they got a great deal…Inform them of your buyer process that will find the perfect home for them, at the right price, and without the common hassles they’ve had in the past.
5. Have You Been Pre-Approved?
Notice this question doesn’t say, “have you met with a lender?” or “have you been pre-qualified?”
It asks about “approval.” Why? Because when your clients are pre-approved, you know 1) they’re serious about buying, 2) you know how much money they’re able to spend, and 3) they’re ready to buy NOW.
Chances are they are not approved, so you need to get them approved before moving forward. The best way to motivate buyers to go through the approval process is to say,
“Mr. and Mrs. Buyer, sellers like to know they’re dealing with a true buyer, not a tire kicker. When you actually get pre-approved, you not only demonstrate that you’re serious, but you’re seen as serious as a CASH BUYER in the eyes of the seller. This gives you a much stronger negotiating position and will ultimately save you a lot of money and time. Here are the names of (1 to 3) mortgage sources that can help you in the process. Let’s call them right now and get the process started.”
6. Are You Working With Another Agent?
You don’t work for free! Ask this question above early in the conversation to determine if you should even continue…
- If the person is working with another agent, you can ask them if they’ve signed an “exclusive” Buyer Broker Agreement.
- If they already signed an agreement with another agent, ask them why they’ve called you instead, and then explain that their agent would be better to answer questions.
- If they are unsatisfied with their current agent or their agreement with another agent is ending, investigate how you can help them.
- If they are NOT working with another agent, continue directly to the next question.
7. When Can We Meet To Discuss Your Property Search?
Notice the question was not, “can we meet…?”, but “WHEN can we meet?” Why? Because the latter question leaves little room for a “no” answer.
This is the ultimate way to determine how serious the buyer is in the search, because if they don’t want to meet in person in the next week, they’re not ready to buy and will waste your time.
Here’s a tip: try to meet in your office if possible. This way you will have control and can present your services, make copies of documents, and have their full attention.
Your time is valuable. Guard it like Fort Knox. Properly qualifying buyers is one of the quickest ways to reduce the number of hours you work, get your commissions faster, and maximize your income per hour.
[Ed. note: To find out how to work with the highest-quality buyers and sellers, learn more about our new program Superstar Closing Secrets™ by clicking here...]
