Being a real estate investor is not all that it is cracked up to be. Investors on TV shows and late night infomercials may be glorified for viewer pleasure. For every five successful deals you have, you will inevitably encounter a series of rough patches. Much of the real estate investing business is a numbers game. If you market to a greater number of people, in theory, you should gain more leads. The more leads you get, the higher conversion rate you have. That means some of these deals will fall by the wayside at some point. This may happen after the initial conversation or at the closing table. However, what you do and how you react when this happens will often dictate what kind of an investor you are. More importantly, keeping your composure will ultimately lead to more success.
Other than losing money on a deal, having a deal fall apart right before closing is the most demoralizing aspect of real estate. You can spend months getting everything lined up, only to find out that someone dropped the ball or someone had a change of heart at the 11th hour. It can be easy to point fingers and play the blame game, but it is at these times when you need to put your best foot forward. Losing one deal is no fun, but it is part of the business. If you berate the attorney or one of the realtors, you may lose future business. Keep your composure and maintain healthy relationships.
This doesn’t mean you can’t fight to save your deal, but at some point you need to know when to back off. If you are in the business long enough, you will realize that deals have a way of coming back around. If you are slow or you needed the closing to move forward with other properties, this can be especially painful. However, if you maintain composure, people will take your appreciation into consideration. You may actually start a relationship that could be far more valuable.
After losing a deal, most investors will throw it in the trash and never look back. However, it is critical to find out exactly why the deal blew up and what can be done to reconcile it. Sometimes it is best to revisit the situation after everyone has had time to think about it. If you are working with distressed property sellers, you have to put yourself in their position. They are selling because they have to instead of wanting to. This is a trying time in their lives and they want to cover all of their bases and take their time. Sometimes they just need reassurance or want to explore one more option before they move forward with you. If you blow up after they have a change of heart, you will lose them forever. If you give them some time, it might be all that they needed.
Losing deals happens to the most seasoned investors. This is why it is important to have a constant flow of deals coming in to always keep your business moving forward. It is easy to be an investor when things are going great, but when things get rough, everyone involved in the deal will be looking at you to see how you react. If you keep your cool, you may actually turn a negative into a real positive.