How to Deal & Negotiate With Motivated Sellers

Anyone that has browsed a real estate listing is familiar with the term “motivated seller.” Many people take this term to define homeowners who are motivated to sell their homes or property.

However, there is a more complex answer to the question of what defines a motivated home seller. In reality, the root definition is anyone with the desire to close the sale of their home quickly. The desires and motivations behind this urgency can differ from seller to seller.

Motivated seller real estate situations can be beneficial to investors if you understand how to approach the situation. In this article, we’ve got tips on how to deal with a motivated seller and the behavior-specific types of motivated sellers. We also discuss motivated sellers’ negotiation tactics.

WHAT IS A MOTIVATED SELLER?

What does a motivated seller mean? A motivated seller is a homeowner that has listed their property with the goal of finalizing the sale quickly. This term doesn’t always mean the seller is desperate or willing to part with the home for the lowest offer possible.

Outside factors normally drive any motivated seller. However, there are different tactics used by specific types of motivated sellers. Different driving forces affect the motivated seller’s negotiation methods.

Making the exchange beneficial for investors is only possible through education on how to deal and negotiate with motivated sellers. However, it’s important to understand the most common reasons for sellers to become motivated before this can happen.

COMMON REASONS HOMEOWNERS BECOME MOTIVATED SELLERS

There are several common reasons why homeowners gain a sense of urgency when it comes to a sale. Each reason also brings a different set of behaviors and a change in motivated sellers’ negotiation approach. You’ll better understand how to deal with motivated sellers once you are familiar with what drives their urgent behavior.

Their investment in the home could have been minimal enough for the listing to have further price reductions
The seller could enjoy the process of being chased by various investors
The homeowner could be willing to arrange selling concessions for the investor
The home could be very close to or already under foreclosure
The home could have the potential to witness a large decrease in value in the near future
The seller might want to see any offer before canceling the listing for a potential buyer
If the price of the home falls any lower, it will be considered a short-sale

WHAT ARE THE ADVANTAGES OF DEALING WITH A MOTIVATED SELLER?

In real estate, motivated sellers are sought out by many investors. This is because of an increased risk in several scenarios that benefit the buyer. If you know how to deal with motivated sellers, the advantages of the exchange are increased.

Motivated sellers’ negotiation tactics and behavior can be hard to read depending on the driving forces behind these desires to close quickly.

SUBSTANTIALLY LOWER SELLING PRICES

The prices a motivated seller is willing to accept have been much lower than appraisal prices. Based on the amount an investor relists the house for, these lower selling prices could translate to higher profits for a buyer.

If you know how to deal with motivated sellers, you may have the ability to trigger them into dropping the price. Motivated sellers’ negotiation skills become a nonfactor once they hear a specific price point.

MOTIVATED SELLERS NEGOTIATION TIMES ARE SUBSTANTIALLY LOWER

The possibility for lower amounts of negotiation exists if you know how to deal with motivated sellers. Because of the desire to reach a fast closing date, homeowners may skip a lot of negotiation.

Long, drawn-out negotiations add many hours to already time-sensitive sales procedures. Honestly, most motivated sellers are content with avoiding any negotiation at all.

If a homeowner makes a listing with the label “priced to sell,” it generally means the listing is already marked at the lowest price possible. Any negotiations are futile because there is no more wiggle room in the price.

YOU COULD RECEIVE BONUSES DURING THE PROCESS

Sometimes there are special clauses in sale contracts based on items in the house, around the house, or separate components on the property. Extra land falls into these types of categories.

For example, a homeowner might have a mobile shed or carport in the driveway or yard of the property. This component might not be listed in the original ad for the house. However, a motivated seller could potentially include this item for free in the sale as a bonus to reach a final closing agreement.

Additional parcels of land and items throughout the home like appliances and furniture are included in this scenario as well. You’d be surprised at what a homeowner will give away to see the end of the sale process.

TYPES OF MOTIVATED SELLERS AND MOTIVATED SELLERS NEGOTIATION TACTICS

Depending on the driving forces behind a homeowner’s urgency, several behaviors make up types of motivated sellers. Motivated sellers’ negotiation methods and general behavior will vary based on the type of seller you’re dealing with.

Recognizing these motivated seller personality types allows you to be prepared for how to deal with motivated sellers.

THE DESPERATE SELLER

Sometimes a motivated seller can become so concerned with reaching a solution quickly that it can cause them to seem desperate. The homeowner may have a major problem that can only be solved by the sale of the home.

In some cases, a house can sit on a market for an extended period, leading the seller to become anxious. The belief that the home will never sell can quickly lead to a feeling of desperation in a homeowner attempting to finalize a sale.

Weaknesses in motivated sellers’ negotiation efforts are present when desperation comes into play. If you know how to deal with a motivated seller who is driven by desperation, you can quickly manifest a lower than the normal sale price.

THE TRICKY SELLER

The tricky seller is a motivated seller using the term to their advantage to generate a fast sale or a high number of offers. The term “motivated seller” on a listing draws fast, lower-than-normal offers on homes that have been recently listed. This fast influx of offers will allow the seller to make counter offers that could still potentially entice some of the investors to agree to a raised price.

These sellers are commonly present in scenarios where the homeowner could have potentially overpaid for the home or received a property that wasn’t the diamond in the rough they thought it was. Because of these reasons, the seller wants the property out of their hands and fast.

In this case, a homeowner is using the term “motivated seller” as bait for potential investors. Approach these types of sellers with caution, being careful not to fall into the same traps they did.

THE SAVVY SELLER

A savvy seller will use the term “motivated seller” as a means to generate an exchange of bids between investors. If a seller can convince a high number of buyers that the home is a once-in-a-lifetime investment opportunity available for a steal because of the “motivated buyer,” these buyers will fight for the home.

If one person thinks a home is a steal, chances are other buyers involved will think the same way. This type of seller can quickly turn a low-priced listing into an expensive back-and-forth bidding war. In the end, none of the buyers end up winning because the scenario was an illusion.

THE SELLING SELLER

Some sellers just say they’re motivated, but in reality, their levels of motivation aren’t driven by anything more than they want to sell the house. The excitement of potentially making money will lead sellers to push the house as a hard sell.

Using the term “motivated seller” brings on a high number of interested investors, and these sellers know it. However, the eagerness of this seller can be used against them.

These motivated sellers’ negotiation skills can be weak, and someone who knows how to deal with motivated sellers can quickly dispatch their efforts. Usually, the home can still be acquired for a fairly low rate just because of the homeowner’s eager attitude towards making a sale.

15 GOLDEN RULES FOR WITH MOTIVATED SELLERS

Find a motivated seller by using motivated sellers real estate leads or other means
Use this for how to find motivated sellers real estate listings
Determine the price and terms you have in mind for the deal
Build a personal connection and make the seller feel comfortable
Ask questions about why the homeowner is selling and pay attention to details
Find out their motivations for selling
Test them with a lowball offer and gauge their response
Wait for the next price reduction
Offer options for different closing dates
Pay your own closing costs instead of asking the seller to pay them
Offer to rent the house to the seller for a short period
Figure out secondary motivating factors
Be transparent
Ask about other offers
Close the deal

Talking to Motivated Sellers: Motivated Seller Questionnaire

Using a specific set of questions to elicit the responses you want can be a good psychological asset to use in an exchange with a seller. The questions are arranged in a way that provides us a route to the answers we want.

Would you consider taking a slightly lower amount if it meant getting out of your obligation to the home today?
Are your motivations more driven by financial or time-related factors?
Would it be worth it to extend this listing for a small amount of money?
Would you be willing to part with some extra components or add-ons for the opportunity to close faster?
Are you prepared to sit on this listing if you don’t get the price you want?
Have you thought about the possibility of not getting the offers you’re expecting? Can you sacrifice some demands for a smoother, more quickly closing process?

By asking questions like these, you’re nudging the seller to offer you the home for a lower price immediately. The way these questions are worded triggers negative emotions in the customer based on the sale not going the way they expected. Asking these questions allows you to be the one pushing a sense of urgency, and it promotes a certain level of trust between you and the seller.

WHERE CAN YOU FIND MOTIVATED SELLERS?

There are many different resources when it comes to finding motivated sellers.

Motivated seller lead companies are the most efficient resource for motivated seller listings. Alternatively, investors can also check other resources to locate their batch of motivated sellers.

Online classified websites can be a great place to find motivated sellers. Sometimes homeowners will manually list their homes on multiple types of these sites. Usually, if you see the listing in more than one place online, it’s a good sign a motivated seller is posting these listings.
Newspapers can be a great source for motivated sellers. These homeowners take the time to pay for and post the ad, so chances are they’re in a hurry to sell.
Home and property auctions can provide you with a motivated seller in the form of the auctioneer who is in charge of the sale.
Estate sales can often present the opportunity to meet a motivated seller. Talk to other guests at the estate sale to gain information about the sale of the house.
Social media groups and other online message boards can be a good source for motivated sellers
Motivated sellers can be found by browsing old real estate listings.
Any property or house that’s been advertised online for a long time can lead you to motivated sellers behind the listing.
You can find motivated sellers online using real estate message boards that ask questions about listing a home or selling a home quickly.

Finding a motivated seller isn’t as difficult as you think. The difficulty can lie in managing your exchange with a motivated seller or asking them engaging questions without stressing them. Recognizing challenging behaviors you potentially face from a seller can help you plan to avoid these behaviors in the future. And here comes the success of your real estate business.

Get in touch with us today if you’re looking for high-quality motivated seller leads. Also check out our exciting latest deals!