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5 Factors That Distinguish Real Buyers From The Fakes
This is no joke. Some people make it their business to call up sellers, attend open houses, and negotiate deals with little to no intention of making a deal.
It’s one of those natural phenomena that occur like the Arctic lights.
Sometimes these people just have nothing better to do with their time, sometimes they are just feeling out how much their own homes are worth by knowing more about yours, sometimes they are already ready to buy another property but just want to know how that property stacks up against yours.
And there are many more ludicrous reasons that people feel wasting your time is justified.
If you don’t know how to identify them, you would be wasting a lot of time chasing a shadow.
The worse thought is that the time you’ve spent on fake buyers could have been used on real serious buyers who you’ve neglected.
Here are some key factors that will help you sieve out bogus buyers from the real ones.
1) They can afford it
You would be floored if you know the actual number of people who visit open houses even though they know that they are not able to afford it.
While some genuinely don’t know that they cannot afford a house because they assume their mortgages would be approved without any hiccups, some knowingly still pretend to be genuine buyers fully knowing that the bank had already rejected their loans.
If a prospect is not financially able to buy the house, no amount of selling on your end will be able to close an agreement.
Genuine buyers have done their homework and in many cases even have a preapproved loan ready with the approval letter in hand.
They already have their finances worked out because they don’t want to waste their time looking at houses they cannot afford.
Their agents might even have informed them that getting prequalified for a loan could be a critical factor that sellers consider. This is why they don’t play games and get in-principle approvals before starting their home search.
Sometimes you might even run into those who would only buy if they are able to sell their current homes. Those are a waste of time too.
It takes a lot of time for the proceeds of a sale to be available. That is without taking the time it take for them to sell the house into consideration. Scenarios like these almost never bear fruit.
So don’t waste your time with them.
2) They are realistic
If you have had the experience of selling a property, you must be familiar with the sour taste in your mouth when “buyers” make radically low offers to purchase.
Sometimes even as low as a 50% discount.
Unless you can tell that it’s a ploy to start negotiating, these fakes are best ignored.
Real buyers do their research or have agents who have done it for them.
They don’t fool around with fantasies and have no intention with becoming a legend in real estate negotiating.
They know and accept that there’s a market value that the property in question is hovering around. Lowballing is not on the agenda.
This is because they really need to buy a house for one reason or another. And usually it is because…
3) They have a time frame to meet
Most home buyers have a deadline which they know that needs to be met.
Failing which would result in some kind of pain.
It could be that they:
- would have to pay more rent if they don’t get a house of their own
- would have to spend some time being homeless
- would have to continue traveling for 3 hours a day just to get to work at a new employer’s office
Deadlines are one of the most powerful and decisive negotiation tools.
Very often, buyers are willing to meet prices above market value if they like the house and have little time left to play with.
On the other hand, if you have a deadline, make sure not to reveal it. Or else the buyer might just use it against you to get your agreement on a lower price.
4) Motivated to buy
Real estate in the real world is not a board game.
Households and investors don’t buy property at the cashier while waiting to pay for groceries.
There will always be a motivation why they are buying a house.
It could be that:
- Their kids need their own rooms
- A new job in a new city
- New members in the family
This is why you need to determine if a prospective buyer has any real motivation to purchase the house.
If a buyer says that he is just “looking around” and have no real need trade up or down, he has just revealed himself as a phoney.
Don’t get me wrong.
It’s perfectly fine when someone turns out to be a phoney. But just not at the expense of my precious time please.
5) They cooperate
If you are genuinely trying to sell your property at fair market value, you would undoubtedly make every effort to satisfy the requests of buyers to make as smooth a deal as possible.
This goes both ways.
If an authentic buyer genuinely want to make a fair offer for the house, he would go to great lengths to address your concerns.
If for example, you require buyers to have a pre-approved mortgage ready before making an offer, a serious buyer should have taken steps to ensure he meets your request so as to bring advancement to the deal that is about to take place.
Buyers who have little care about what you want often have skeletons hiding in the closet.
Maybe they have outrageous terms which they are too embarrassed to sound out, maybe they have bad credit and are too ashamed to disclose it, maybe they never turn up for meetups after agreeing a time and place.
If you feel that a buyer is pulling your leg and he took no action to make it up to you, it is very likely that you are just wasting your time on another hobbyist.
Finally, the gist of mentioning all this is not to avoid wasting time on the wrong people. It is about making more time and spending them on the real buyers.
So do actively filter out fake buyers so that the value of your time is not compromised. Time is after all, priceless.