Give the Seller what the Seller Needs

The question of "seller needs" is a complex one.

Often real estate investors resort to sophisticated psychological observation and strategic interrogation in order to penetrate the seller's wall of secrecy.

That is fine as far as it goes. But the best approach is nearly always the direct one in the form of one simple question: "What do you need the money for?"

There are more subtle variations, such as, "What do you plan to do with the proceeds of the transaction?"

But it all boils down to the same thing - letting the seller know that you can solve his problem best if you know what he plans to do with the cash coming to him as a result of the sale.

Often the seller has consumer needs that the real estate investor could satisfy by carrying the necessary amounts on charge accounts or credit cards.

The immediate up front cash needs are spread out over time.

Frequently the seller will be anticipating financial obligations that will require a set amount of cash each month beginning at some time in the future.

If the real estate investor is on his toes, he can help the seller translate the down payment into installment payments that can be taken over by the real estate investor in lieu of a heavy cash down payment.

One real estate investor we know of in Stanford, California, gained insight into the seller's need for future day-care funds and persuaded her to reduce the down payment by $13,500.

He was able to do this by providing monthly payments toward her day care for the next thirty years at very low interest.

He was able to supply the seller what was needed and spare himself a heavy down payment obligation.

Deferred Down Payment - No Mortgage Payment

There are endless variations of how seller financing might be set up.

Here is one more, which could prove useful under certain circumstances.

A seller of a free and clear real estate property who needed cash down only to build trust in his real estate investor might be induced to forego rental income for a few months while the real estate investor accumulated enough to put together the required down.

It is not a common opportunity.

But it has happened in the past and will happen again in the future - perhaps to you.

This technique, together with the other seven described and illustrated in this section, should stimulate creative real estate investorss to take advantage of seller flexibilities in financing.

Seller financing after all, is one of the major sources for down payment capital.