Cleveland Home Buyer and Seller Education Series: Creating Good Will
I often get asked by both Greater Cleveland Home Buyer and Home Sellers:
Ignoring good will or even purposely and unilaterally adhering to WIIFM (what's in it for me) to the detriment of good will can cause a transaction to fall apart, and the financial consequences can be severe sometimes, but almost always, emotionally gut wrenching at a minimum.
Ignore good will at your own peril.
Creating good will in a transaction is very important yet I find it gets little attention when it comes to negotiating, general customer service, and community styles.
There is an old saying: What goes around…comes around.
Everyone involved in a real estate transaction should try and express good will at every turn as you never know when you will need it in return.
Real estate transactions by their very nature are complex. Complex on many levels:
• Property itself and its condition
• Inspections – home, pest, radon, mold, structural, environmental, geo-technical, etc.
• Financing – appraisal, underwriting
• People –seller, buyer, listing agent, buyer’s agent
• Emotions and stress
• Title company
• Escrow company
• The local real estate market itself – stable, declining, increasing, months of housing supply, etc.
• Changing interest rate environments
• Local economic conditions – forced job changes while a purchase and or sale is pending
• Dependence on other real estate transaction(s) closing in order to allow this transaction to close. Even another transaction may yet depend on another transaction closing (the chain is only as strong as the weakest link). Let alone same day closings of funds needed from one transaction needed in order to close on a subsequent transaction.
• “You are not going to believe what just happened…” – Wish I had a nickel for every time I have heard this one.
• Need to modify the terms of the purchase agreement due to uncontrollable circumstances.
I’m sure the above list could easily be added to but it drives home the point that even when you have exceptional people, processes, systems, allied service providers, etc. in place, something can always go wrong, a deadline can get missed, etc., with a resulting impact to the transaction as an end result?
So why is good will important? Because…if stress, change, and issues arise in a real estate transaction, if good will is front and center, it makes a positive resolution to the issue(s) at hand easier to resolve. The reverse is also true: if good will was never there from the start, or was burned through early on in a transaction, sometimes there’s just nothing left and if stress and emotion then rule the day, having a successful outcome can become much harder to achieve, and in fact, can sometimes break a transaction with the end result being a failed transaction that in reality, should have closed successfully.
What are some good ways to express good will in a transaction but yet still protect your own interests?
• During a stressful situation, never react quickly. Think it through, preferably overnight after emotions can have a chance to play out, then respond logically, keeping your goals in mind.
• Measure your words carefully. Contrary to that age-old saying: Sticks and bones can break my bones but words can never hurt me – that has got to be the dumbest saying of all time. Words are immeasurably powerful. One only has to read a good novel, listen to an inspiring orator, or a mean, nasty and negative person to know the power that words can have on an individual psyche, and hence future actions.
• Focus on your goals. If a change needs to occur and it does not impact your goal(s), it’s a good thing to let the other side have their request accommodated. Hopefully, with like-minded good will, the other side will as well.
• Choose an agent who has a strong background in negotiation, written and oral communication and exceptional customer service skills. The old saying: The chain is only as strong as the weakest link – applies here. Choosing a skilled, objective and seasoned agent who has a strong track record of client success is key. Ask your agent for numerous and recent references, both buyer and seller references. Call these references.
• Focus on choosing the best solution available, not exclusively on the problem. Problems are simply challenges to be solved.
• Stay positive. No matter how serious an issue it seems at the time, in retrospect, a client almost universally says: Gee…it really wasn’t that bad now that I think about it.
• Communicate clearly and in writing. I have seen misunderstandings result much to the detriment of everyone because of a lack of understanding of each party’s understanding and position. Effective, written communication can go a long ways to ensuring any verbal conversations are documented and understood by all parties. Moreover, ensuring the other party has actually read the written communication should not be taken for granted either.
I’m not advocating that good will is like the Pollyanna Principle. I have seen firsthand, that sometimes, a given transaction between a specific buyer and seller is simply not meant to be. Sometimes, there is fundamentally something so off in a transaction that no amount of attempted good will and professional competencies can overcome it. If one person has a perspective that defies market realities or common sense, or an institutional constraint arises, etc., sometimes, well…a transaction is going to fall apart.
That said…here’s to good will – the often overlooked concept can help keep a transaction on course when troubling weather arises!
Read other posts in the Cleveland Home Buyer and Seller Education Series:
- Show me the earnest money
- Creating Good Will
- Closing Cost Assistance
- Documents Needed for Loan Pre-Approval
- Future Resale Implications