Page 162 - Trump University Commercial Real Estate 101

TRUMP UNIVERSITY COMMERCIAL REAL ESTATE 101

So write up your LOI. Then do not just fax it over blindly to the
broker or seller. Instead, call the seller and say:

Mr. Seller, I ’ m about to fax you over an LOI for your Main Street prop-
erty. I want you to know that I ’ ve analyzed the numbers and my offer will
come in much lower than the asking price. As a matter of fact, based on
the numbers that I was given and my need to have a 10 percent cash - on -
cash return going into the deal, my offer will be X dollars. I know it is
much lower than the asking price — should I fax over the offer?

The other party will start asking you questions. This will give you
the experience of answering questions about the deals you ’ re making

offers on. The more you do this, the more confidence and momentum
you ’ ll create for yourself, and the more relationships you will be
developing.
From time to time, the answer will be “ Yes, fax it over. ” Great!
Now you ’ ll be negotiating with absolutely no risk on your part. Will
you be asked questions you can ’ t answer? Yes. So what? Anyone in this
business has been in that position, so it ’ s not a big deal.
You ’ ll also have a great experience from time to time, when one of
these low - ball offers is accepted!

How to Recognize a Bad Deal Early in the Process

Now that you are on a quick learning curve, analyzing deals and mak-
ing offers, it ’ s important to manage your time properly. After all, my
system is all about getting into real estate while you still have a day job.
If it works in that situation, imagine how well it will work when you
are your own boss someday!
When you ’ re making offers and analyzing counter - offers, the
sooner you can recognize a problem and estimate its size, the more
efficient you will become. You ’ ll spend less time on the low - payoff

deals and gravitate toward the ones with serious potential.

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