Chess is a thinking game.

Good players think many steps ahead before they make a move. They also have a number of set moves (both offensive and defensive) in their back pocket.

So do most seasoned real estate investors.

To buy and sell property they must solve buyer’s and seller’s problems in order to make a profit. I know investors (including myself) who spend a little time each night imagining themselves talking with a seller or buyer and showing them how if they can work the deal in a different way then they can both get what they want. Why should business owners be any different?

Let’s look at an example of a real estate investor being creative and then turn that example into how a business owner could do the same thing to increase sales.

A Creative Real Estate Investor Example

Say you’re selling your home and it’s listed with a Realtor for $300,000.

Typically, when using a Realtor you just advertise an asking price and maybe also offer to help the buyer pay some of their closing costs. With the sale of your property you want to invest $50,000 in an investment which pays 5% interest for your one year old son’s college. The remaining $50,000 you will use to put down on your next house. You are pretty firm on this.

Now along comes me, a buyer/investor, and I love your house. The only problem is, my bank will only give me a mortgage of $250,000 and I only have about $25,000 cash.

At first glance it doesn’t seem like this would be a possible deal for us but remember, thinking creatively and solving the seller’s and buyer’s problem can get us what we both want. Here’s how.

After talking with you I come to understand what it is you want to do with the sale of your house. I then might propose to offer you $250,000 cash for the house (that would be my mortgage) and for the remaining $50,000 (the amount you want to invest for your son’s college) I offer that you hold that amount back as a second mortgage (seller financing) on the house with an interest rate of 9%. I’ll make interest only payments to you for a period of 10 years at which time the balance will be due.

Here’s what we’ve done.

I made out. I got the house and that 2nd mortgage you gave me was my down payment, thus I got in with no money down. You made out BIG.

You got $50,000 to put down on your next house and an investment that instead of paying 5% on your other $50,000 you came out with an investment that pays you 9% and pays you monthly payments of $375. Now imagine if you took those monthly payments and invested those into a Roth IRA for even MORE investment. WOW! What a great deal for you!

What we’ve done is sold your house – but in a different way. We solved both our problems. Now let’s take that example and show how a business owner might use the same logic to sell their service when it might otherwise not appear the buyer could afford it.

How A Business Owner Can Benefit From This Logic

Again it’s about solving your buyer’s problems.

Let’s say you’re a hardscapes contractor (you do concrete work, build patio covers, etc.) and you meet with a potential customer. They want a lot of concrete work done in the back yard and you tell them it’ll cost them about $15,000. They tell you they only have $10,000 and unless you can drop the price to that they’ll have to pass.

Your problem is that’s what your cost is just to do the project, no profit included.

Like in the example above, at first glance it appears you don’t have a sale. Many contractors would just walk away and say to themselves, “Those people are dreaming if they think they can get it done for that price.” But times are slow right now and your workers need work or you might lose them and you have bills to pay. What to do?

Let’s apply the real estate investor’s logic here and create a win-win situation for both of you.

You tell the potential client that you are unable to reduce your price to $10,000 but you could accept $10,000 now and the remaining $5,000 can be paid to you in payments in a form of a loan with an interest rate of 9%; that’s better than most credit card interest rates.

They agree.

Now they got what they wanted, you were able to give your workers work, and instead of walking away from the deal (no profit/business for you) you are receiving monthly payments of say $200/month and are earning interest on $5,000. By receiving payments over time you are actually making more money because you are charging interest.

What have we accomplished? We turned a no deal situation into a profit and your workers don’t go hungry. Now imagine if you did this 10 times a year? That would be $200/month x 10 = $2,000/month income. Hey cool. Now you get to pay your debts even when it’s slow and there’s no work!

People often times will pay more money if 1. you make it easy for them to buy and 2. you give them what they want today and not wait.

This is the power of thinking creatively.

Next time you have a potential client and it doesn’t appear you can strike a deal with them, think for a moment how the deal could be worked in a different way. What are your real needs and what are theirs? Don’t listen to what they are saying, listen to what they are meaning.

Solve their problem and you’ll find you are also solving your own. Do like I do. Take some time and think about all the objections or reasons why your client might refuse your offer and come back with a response; this way when they come up in real life you’ll already have the answer.

Related posts:

1. How To Buy A House Like A Real Estate Investor: Part 8 – Good Terms vs. Low Price
2. How To Buy A House Like A Real Estate Investor: Part 4 – Getting Your Closing Costs Covered
3. How To Buy A House Like A Real Estate Investor: Part 2 – 7 Methods For Covering Your Down Payment
4. How To Buy A House Like A Real Estate Investor: Part 7 – Knowing The Right Method To Buy Under
5. How To Buy A House Like A Real Estate Investor: Part 3 – More On Dealing With Down Payments