Ok I'm back and well rested after a nice (but cold) holiday hiatus, and it's time to talk about protecting our clients and customers. I'm talking about Risk Management techniques and strategies.
Let's start with the buyers risk strategies. There's a lot that could go wrong along the way so I'm only going to deal with a couple here. Knowing me I'll talk about most of them eventually, but for now these will do as good examples.
Before even writing the offer we should have had a long discussion about the process, not just the basic steps but the real expectations. In market conditions where inventory is high and demand is low, what are the risks or rewards in making a low offer. Rewards we won't bore you with, the risks might be that the seller is not at the bottom of their emotional cycle yet and a rock bottom offer might alienate them for later negotiations.
I'm not saying don't try it, I'm just saying know what the downstream impact could be...you get the seller to a rock bottom price and now the home inspector identifies several issue that the buyer is concerned about and the seller now digs in their heels and says "No more."
Well you say no problem I'll play hard ball too. Ok, I'm up for that, but you (the buyer) need to tell me you are ready to walk away because that's where we are. What has the buyer lost? Home inspection dollars, time, and tied up their cash from the deposit money - yes the seller will likely be returning it but in the best case it might take up to 30 days, in the worst case they might dispute the deposit, even if the seller looses his dispute, which sounds likely, that could take a lot of time!
When was the last time you talked your buyer down a road like that? They will likely be angry, and you don't want to be standing there like a deer in the headlights wondering what happened - you want to be able to coach them and advise them at each twist and turn. We're the professional; they are counting on us to prepare them for the next couple steps.
Get in the habit of giving your clients the upside and the downstream possible downside of issues, and they will make better decisions.
Go make it a great week for yourself!
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