We list all our wholesale deals on the MLS and aim to help more sellers through these renegotiations. The goal is clear: close more deals and turn potential losses into profits. This was essential for deals that would otherwise have fallen through. Before adopting this approach, we often gave up on deals too quickly.

The key to successful renegotiation is motivation. If a seller isn’t motivated and is only concerned about the price, they won’t agree to a further discount. Sellers must have a compelling reason to accept a lower offer than initially agreed.

The individual handling these renegotiations should be one of your top closers, someone who frequently interacts with the seller post-contract and has built a good rapport. The role should be your most experienced person handling dispositions. The crucial factor is that this person maintains regular contact with the seller, aiming for two to three interactions per week to provide updates and build trust.

We recently put a seller’s house under contract for $240,000. The seller wanted to sell because she was tired of being a landlord. She had rented the house to a family member who made a mess of it, and she didn’t want to fix it up. When we inspected the house, we discovered a sinking foundation in the garage, and the condition was worse than she had described. We informed her about these issues, mentioning that they would affect our ability to sell at the original price. At this point, we weren’t renegotiating but preparing her for a potential price adjustment later.

Over the next few weeks, we received offers from buyers ranging from $200,000 to $220,000. It became clear that we needed a significant renegotiation. I communicated with the seller, letting her know that offers were coming in around $180,000 net to her. Initially, the seller wouldn’t go lower than $220,000, which was $20,000 below the original price. This was some progress, but we were still far apart. We then received a $225,000 offer from a cash buyer. The seller agreed to a price reduction, settling at $200,000 or $40,000 below our original agreed price. Remember, you can’t finalize a deal with the seller without a solid offer from your buyer.

We closed the deal securing a $20,000 fee after agent fees and double-close costs with the B to C closing. We achieved this by continuously communicating the offers to the seller and keeping them informed about the showings. The key to building rapport, aside from understanding the seller’s motivation, was constant communication and maintaining a good relationship.

Renegotiation begins with the Acquisition Manager:

• Educate them about the market
• Interest rates rising
• Inventory rising
• Less buyers
• Prices falling

If we don’t inform sellers about these changes, how will they agree to a price much lower than what their neighbor received last month, possibly $25,000 less? We must educate sellers now.

Our acquisitions manager is trained to walk sellers through the worst-case scenario, which is that we will bring them offers. The sellers can then decide to accept or decline those offers. The decision is in their hands. We secure a long due diligence period in our A to B contracts, specifically 30 days from the time of inspection. This means our due diligence period starts post-inspection, not when the contract is signed, giving us 30 days to move the deal forward.

Post Inspection Call:

• After the inspection, if it’s clear the deal isn’t great, we should start preparing for renegotiation
• Inform the sellers about any problems found during the inspection that they hadn’t disclosed to the acquisitions rep
• We are still going to bring you offers

We have a process on the acquisition side to review all the house details. If any details were omitted, our disposition rep will discover them during the house visit. Again, we reassure sellers that we will bring them offers. This isn’t sales training, it’s about the process.

Sales Skills Needed:

• Tactical empathy
• Price anchoring
• Impactful questions
• Picture-perfect questions
• Third-party stories

I use these techniques whenever I’m going into a renegotiation because the skills needed to acquire a house are transferable to renegotiating house purchases. Just like an acquisitions rep, you have to follow a sales process.

If I ask a seller for a $50,000 discount a day after we’ve gone under contract, do you think she’ll agree? Probably not. You’re likely to hear many “no’s” and might even upset the seller.

Communicating early and often is crucial:

• After every showing, call the seller to provide feedback from the buyers, especially the negative comments
• Disclose all offer prices you are receiving, net to them
• I often tell sellers, “I speak to many industry experts who say the market might get worse”
• Sharing information from a third party adds authority and experience to your message
• Receive a lowball offer, even if it’s not acceptable? Inform the seller. This helps lower their expectations.

People prefer talking to someone knowledgeable, so use third-party stories to reinforce your points. For instance, I had a seller three months ago who canceled a $120,000 contract with me, went with another wholesaler, then a realtor, and after months of delays, called back wishing he had accepted my offer.

It may seem like a lot of work to constantly update the seller after every showing and offer. But is it really a lot of work if it can add thousands of dollars in additional profit for just four extra hours a week? I’d take that ROI any day.

Achieving a higher conversion rate in renegotiations starts with the acquisition manager setting the stage by discussing worst-case scenarios and securing a longer due diligence period. With a 10-day due diligence period, you can’t effectively “work the cut” post-inspection. You need 30 days. Your disposition rep needs to communicate any issues found during the inspection that the seller or acquisition manager might have missed. By educating the seller, you establish rapport, which enhances your credibility and allows you to use your expertise to renegotiate a lower property price. And, that is what we call the art of renegotiations.