Coaching
Digital Body Language
Interpreting Buying/Selling Signals in a New Way
“Digital Body Language”, written by Steven Woods is my current read in progress. I’m interested in the subject as we become proficient in communicating and reading the body language of our clients in Digital Land. I’m sure as I move along further in this book, I’ll have more to share from his perspective, but again, the subject is one that if we don’t stop and take a closer look at digital behavior – it’s possible to be left in that cloud of dust.
With many buyers/sellers using the information that we provide to them (I hope you are providing them information), they do a lot of their research and prep work before we have the chance for face-to-face. We don’t have the benefit of the clear signs of rolling eyes, arms crossed, eyebrows raised; we have to learn to interpret the interest and motivation in a buyer through their activity – some they choose to reveal by giving it to us and some can determine by evaluating their online behavior.
Using Online Behavior Analytics
Statistics and data serve a lot of purposes – they support or negate the prices of homes and can provide assistance in the decision process of how to proceed in closing the deal. Research with digital behavior of a potential client or lead can also provide some insight to the characteristics we like to see in a serious home buyer or seller.
Usage of Web Sites
Here are some behavioral traits you can track with digital body language that will help you in prioritizing the level of interest and helps to evaluate what the next step should be with a lead: (Disclaimer: Exceptions to every rule, of course)
- Clicker: Is the person a clicker? Just clicking on all of your buttons, links, boxes to see what is next – only staying on the page long enough for it to load? Quickly moving on? This is common in someone just checking out your site design and the information you provide.
- Dreamer: The dreamers look at all sorts of homes in all areas. They are not even focused on a state, you’ll find them a lot in the higher price ranges, searching with no limits.
- Researcher: The length of time spent on the area pages/posts/information about schools and/or community you have on the site in combination with some housing searches can show a person is really researching the details.
- Interviewer: Home sellers will often spend some time looking at what marketing you are doing and your bio/about me page. If you have some “recent sold” statistics – pay attention to visits and length of time here.
- Revealer: Is information provided to you in an email or registration form that reveals a real name, email, or phone number? Or was it refused?
There are many ways to figure out level of seriousness – just be aware and pay attention. I look forward to implementing many of these into my own sites with stats to assist with knowing where to put most time and effort in the bond and nurture stage waiting for the ready and able.
Coaching
Disputing a property’s value in a short sale: turn a no into a go
During a short sale, there may be various obstacles, with misaligned property values ranking near the top, but it doesn’t have to be a dealbreaker!
It’s about getting your way
Were you on the debate team in high school? Were you really effective at convincing your parent or guardian to let you do things that you shouldn’t have been doing? How are your objection-handling skills? Can you flip a no into a go?
When working on short sales, there is one aspect of the process that may require those excellent negotiation or debate skills: disputing the property value. In a short sale, the short sale lender sends an appraiser or broker to the property and this individual conducts a Broker Price Opinion or an appraisal, using special forms provided by the short sale lender.
After this individual completes the Broker Price Opinion or the appraisal, he or she will return it to the short sale lender. Shortly thereafter, the short sale lender will be ready to talk about the purchase price. Will the lender accept the offer on the table or is the lender looking for more? If the lender is seeking an offer for a lot more than the one on the table, mentally prepare for the fact that you will need to conduct a value dispute.
Value Dispute Process
While each of the different short sale lenders (including Fannie Mae) has their own policies and procedures for value dispute, all these procedures have some things in common. Follow the steps below in order to conduct an effective value dispute.
- Inquire about forms. Ask your short sale lender if there are specific forms that you need to complete in order to conduct a value dispute. Obtain those forms if necessary.
- Gather information. Your goal is to convince the lender to accept the buyer’s offer, so you need to demonstrate that your offer is in line with the value of the property. Collect data that proves this point, such as reports from the MLS, Trulia, Zillow, or your local title company.
- Take photos. If there are parts of the property that are substandard and possibly were not revealed to the lender by the individual conducting the BPO, take photos of those items. Perhaps the kitchen has no flooring, or there is a 40-year old roof. Take photos to demonstrate these defects.
- Obtain bids. For any defects on the property, obtain a minimum of two bids from licensed contractors. For example, obtain two bids from roofers or structural engineers if necessary
- Write a report. Think back to high school English class if necessary. Write a short essay that references your information, photos, and bids, and explains how these items support your buyer’s value. This is not something that you whip up in five minutes. Spend time preparing a compelling appeal.
It is entirely possible that some lenders will not be particularly open-minded when it comes to valuation dispute. However, more times than not, an effective value dispute leads to short sale approval.
Coaching
Short sale standoffs: how to avoid getting hit
The short sale process can feel a lot like a wild west standoff, but there are ways to come out victorious, so let’s talk about those methods:
What is a short sale standoff?
If you are a short sale listing agent, a short sale processor, or a short sale negotiator then you probably already know about the short sale standoff. That’s when you are processing a short sale with more than one lien holder and neither will agree to the terms offered by the other. Or… better yet, each one will not move any further in the short sale process until they see the short sale approval letter from the other lien holder.
Scenario #1 – You are processing a short sale with two different mortgage-servicing companies. Bank 1 employees tell you that they will proceed with the short sale, and they will offer Bank 2 a certain amount to release their lien. You call Bank 2 and tell them the good news. Unfortunately, the folks at Bank 2 want more money. If Bank 1 and Bank 2 do not agree, then you are in a standoff.
Scenario #2 – You are processing a short sale with two different mortgage-servicing companies. Bank 1 employees tell you that they cannot generate your approval letter until you present them with the approval letter from Bank 2. Bank 2 employees tell you the exact same thing. Clearly, in this situation, you are in a standoff.
How to Avoid the Standoff
If you are in the middle of a standoff, then you are likely very frustrated. You’ve gotten pretty far in the short sale process and you are likely receiving lots of pressure from all of the parties to the transaction. And, the lenders are not helping much by creating the standoff.
Here are some ideas for how to get out of the situation:
- Go back to the first lien holder and ask them if they are willing to give the second lien holder more money.
- Go to the second lien holder and tell them that the first lien holder has insisted on a maximum amount and see if they will budge.
- If no one will budge, find out why. Is this a Fannie Mae or Freddie Mac loan? If so, they have a maximum that they allow the second. And, if you alert the second of that information, they may become more compliant.
- Worst case: someone will have to pay the difference. Depending on the laws in your state, it could be the buyer, the seller, or the agents (yuck). No matter what, make sure that this contribution is disclosed to all parties and appears on the short sale settlement statement at closing.
- In Scenario #2, someone’s got to give in. Try explaining to both sides where you are and see if one will agree to generate their approval letter. If not, follow the tips provided in this Agent Genius article and take your complaint to the streets.
One thing about short sales is that the problems that arise can be difficult to resolve merely because of the number of parties involved—and all from remote locations. Imagine how much easier this would be if all parties sat at the same table and broke bread? If we all sat at the same table, then we wouldn’t need armor in order to avoid the flying bullets from the short sale standoff.
Coaching
Short sale approval letters don’t arrive in the blink of an eye
Short sale approval letters may look like they’ve been obtained simply by experts, but it takes time and doesn’t just happen with luck.
Short sale approval: getting prepared, making it happen
People always ask me how it is that I obtain short sale approval letters with such ease. The truth is, that while I have more short sale processing and negotiating experience than most agents and brokers, I don’t just blink my eyes like Jeannie and make those short sale approval letters appear. I often sweat it, just like everyone else.
Despite the fact that I do not have magical powers, I do have something else on my side—education. One of the most important things than can lead to short sale success for any and all agents is education.
Experience dictates that agents that learn about the short sale process
have increased short sale closings.
Short sale education opportunities abound
There are many ways to become educated about the short sale process and make getting short sale approval letters look easy to obtain. These include:
- Classes at your local board of Realtors®
- Free short sale webinars and workshops
- The short sale or foreclosure specialist designations
As the distressed property arena grows and changes, it is important to always stay abreast of policy changes that may impact how you do your job and how you process any short sale that lands on your plate.
The most important thing to do is to read, read, read. Follow short sale specialists and those who blog about short sales on AGBeat, Google+, facebook, and twitter. Set up a Google Alert for the term ‘short sale’ and you will receive Google’s top short sale picks daily in your email inbox. Visit mortgagor websites to read up on their specific policies and procedures.
Don’t take on too much
And, when you get a call from a prospective short sale seller, make sure that you don’t bit off more than you can chew. Agents in most of America right now are clamoring for listings since we are in the midst of a listing shortage. But, if you are going to take on a short sale, be sure that it is a deal that you can close. And, if you have your doubts, why not partner up with a local agent that can mentor your and assist you in getting the job done? After all, half a commission check is better than none!
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Ted Mackel
April 29, 2009 at 11:12 pm
What I am running into is buyers who are frustrated losing on multiple offers (because of low inventory), using the internet to research and then contact the listing agent directly thinking they can gain an advantage over the other offers with the enticement of the listing agent double popping the sale on the dual agency.
I see the questions on Trulia all the time after they get in a problem transaction with an agent that is not capable as acting as a dual agent.
Over all most are very anonymous.
Missy Caulk
April 30, 2009 at 6:26 am
It is interesting to see what they are looking at and how long they stay. I have a huge bounce rate but it is getting smaller.
When the dreamers register we have to tell them to narrow their search as my IDX sends them new listings and their inbox will be overwhelmed.
Jim Rake
April 30, 2009 at 8:09 am
Interesting topic – how do qualify/quantify them?
And what do we provide them to ensure they believe we have something to offer? (“I hope you are providing them information”) – and what is that information?
Ted – re “buyers who are frustrated losing on multiple offers (because of low inventory), using the internet to research and then contact the listing agent directly thinking they can gain an advantage”….
Hopefully, sooner rather than later, we’ve convinced our “visitors” that the execution can’t be done without us, that agents do have the expertise needed (OK – yes, most of them have to learn the hard way!)
Open source information is a great thing for the consumer…if you know how to use it.
BawldGuy
April 30, 2009 at 11:20 am
Solid info, Kim — thanks.
Surely there are experts in behavior who can help narrowly define what serious folks look like. I don’t make use of an IDX because my business is spread to many states. Still, my leads, FAR fewer in number than everyone else apparently, are from folks who show their seriousness via their queries.
An example would be the story they tell for four paragraphs ending in them asking me for a possible solution/plan.
That’s serious. 🙂 I wonder if there’s a strategy for house agents using IDX that would allow them to elicit those kinds of messages from their visitors?
Again, thanks for the post. A superb subject in need of further exploration for sure.
Vicki Moore
April 30, 2009 at 5:11 pm
Thanks for the book referral. I’m going to check that out.
One of my favorite shows right now is Lie To Me – not because it’s a great show – it sort of dumbs down to its audience – but because the info is good.
Steven Woods
May 6, 2009 at 12:23 am
Kim,
Great post, interesting application to real estate – I would agree that it definitely seems like a better approach to try to categorize buyers into “clickers”, “dreamers”, etc, rather than look for an exact propensity to buy, as that depends on so many more factors.
Best,
Steve