 President's
Corner
The days are getting longer and
warmer and summer is just a
couple days away. This
week we'll discuss charging what
you are worth.
One of the most common reasons note businesses struggle is that they chronically
undercharge. Now I know that sometimes it's all we can do to get a seller to say
yes and make $500 or $1000 but don't let that turn into a habit. I want you to
charge what you are worth and I do not want you to leave money on the table if
you don't have to. Don't make that mistake. Here is a little list of do's
and don'ts to help you establish a fair price for your services. (i.e. an answer
to the question, how much should I take?)
Don't take less commission for fear of not getting enough business, and
don't be embarrassed to deduct a fair fee for your services. Establish
yourself in your specialty where you can excel and earn what you are worth.
Our business is very niche oriented and you took the time to educate yourself
and practice it as a business. You are the expert, never feel bad about what you
are offering to the note seller. In fact, if you don't feel bad you might
take that as a signal you need to deduct more of a fee. Worst case scenario you
can always give them more but you can never give them less.
Don't forget to cover your out of pocket expenses and your indirect costs
for overhead and benefits in the price you quote. We are talking about
advertising, office expenses, appraisals, title work, recording fees, etc.
Don't forget you need to have a reasonable profit so you can expand and
grow your business.
Do give the note seller your prices openly and clearly without hesitation
in your voice.
Do explain how you work so the note holder understands why your pricing
options are the better options and that going a different route would actually
be more expensive and will not help them achieve what he or she wants.
Do calculate all costs and profit in any fixed price you quote.
Do let a prospective note seller know up front on the first contact that
you buy notes at a discount depending upon the type of property, terms of the
sale, terms of the note, credit of the payor, etc. Don't surprise them
when you call with the pricing options.
Do discuss any possible additional factors that might affect the
value of their note after the initial prices have been given. Prices are ALWAYS,
ALWAYS, ALWAYS subject to verification of the information given and acceptance
of credit of the payor, appraisal of the subject property and clean and clear
title. If any of those things are negative or unacceptable the price may
go down and/or we may not be able to buy the note.
Never sell yourself short. Value the service you provide. But
remember: The only surprise the note holder should have when the
transaction closes is what an outstanding service they got from you for the
agreed upon price for their note.
Remember, Success Demands
Action! Keep on marketing, it’s going to
work! TWITA!
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