Pre-Screening ProspectsPosted on July 28, 2014 by
Last month we talked about locating prospects, meaning buyers, and discovered that the two main ways we do it is, putting out signs and running ads on sites like craigslist. This month, we must discuss how to pre-screen those prospects when they get to us so we can determine the difference between someone we should work with and someone we should ignore.
We must start by deciding how we are going to capture these leads as we generate them. They will come in two forms: 1. Phone Call 2. Online. The first thing we must do is figure out how we are going to take the inbound calls. We use PATLive. Here, you have the choice of either having them taken live, or driving them to a voicemail box and just leaving enough information for you to decide whether you want to call them back. And here, my friend, is the key to pre-screening. The goal is to collect enough information to determine if they are worthy of your time. We’ll come back to that in just a minute.
If you use a voicemail system, check with PATLive on what’s called an IVR, Interactive Voice Response system. They can now set it up so the machine can ask several questions from your buyers without any human intervention. You might note, this is how we receive all our leads that we drive in from the radio at Global Publishing. A voice recorder handles all of the information and does a couple of upsells before they even get off the phone. This use of the IVR has changed our industry and now PATLive can make it available for you as a real estate investor.
If you get your IVR set up, you will need a lot less human intervention because it can ask the key data you need to enter into your database to create your buyers list. If you want to use a voicemail box until your IVR is set up, really all you need to collect is the basics so a Virtual Assistant can then call back the buyer and collect the information for the buyer sheet. Don’t try to let a voicemail box do too much. You can only get so much information on it and sometimes it is not able to be transcribed. By the way, PATLive will transcribe your voicemail messages and email them to you for a very small fee.
If you’re using a website, as you should, to capture leads that come online, you’ll need to collect the same information on it that your IVR or VA is going to collect for you from phone calls. You’ll also need a database to house the information so you can preselect a list of buyers from the list at will. We use Aweber in our business, but there are many. You could use something as simple as an Excel spreadsheet, which will contain different columns so you can select the list by inserting only that information necessary to create the type of list you want. For example, suppose I want a list of buyers who have $10,000 or more on the Northside of town. I’ll only be able to select that list if I keep track of my buyers’ information as it comes in and not just put it all in one big pile.
The key information you must collect from these folks at some point in your relationship is:
- Where they want to live
- The down payment they have
- The monthly payment they can afford
- Is their credit good, fair, or ugly?
- How many bedrooms and baths they require
- A place for them to put in any other requirements.
If you collect this list, and separate it in your database accordingly, it can easily be inserted by a Virtual Assistant or someone else you choose. The time to collect this list, is on the first contact with the buyer, if possible, which will either be done by your IVR from PATLive or a VA. If you can’t get the information on the first contact, you must get it after the prospect has looked at the house and has interest. Somewhere in the process, this information must be collected or you can’t proceed further with your prospect.
Once this information is collected, the rest is easy because prescreening means, “Pick out the ones you want to do business with and get rid of the rest.” If your goal is to put a Lease Option tenant-buyer in the house, or sell it with owner financing, obviously you’re interested in a large down payment. Some of the prospects that call you will have substantial amounts of money to put down on the home. I’m talking from $5,000 – $100,000. We’ve had several lately with $100,000 as a down payment.
When you see these large down payments, it should immediately grab your attention, and these prospects rise to the top of the priority list. Unfortunately, it will be a small percentage of the list, but golly, how many buyers do you need per house? If your goal is to cash out of the house, credit is required. When they say their credit is good or fair, it’s time for you to kick in and find out just how good and how fair because in today’s world a credit score of 600 or more will get them financed. Especially since the FHA has relaxed its rules where even after bankruptcy is six months old, one can get financed today. So it comes down to prescreening, meaning, either they’ve got enough money to satisfy me to lease option it to them or sell with owner financing, or they have credit, or they have both. If they have neither, you have no business proceeding any further and letting them suck up your resources and take up space. Whack ‘em! There’s nothing you can do for them.
Once you decide that the prospect has money, or credit, or both, now it’s time to get all the information you can from them and simply set a meeting to go over all the remaining facts necessary to determine whether you want to drive them to your attorney, if you’re closing a lease-purchase or owner financing or to your loan originator if you’re going for a cash out. In the next issue, we will talk about constructing and presenting offers at this meeting.
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