Sometimes things don’t go according to plan or maybe you never had a good plan in the first place.
You know what, that is the life of an entrepreneur.
There have been many occasions where I have worked tirelessly on achieving a deal, putting in hours, days, months, and even years to get a deal over the line, and right at the last minute something happens that could undo all your hard work and possibly lose you the deal.
A classic is the money, the deal that will generate a great 20% return on your investment after all costs suddenly hit the money challenge!
The lender or lenders have suddenly decided they don’t want to lend you the money!!
I once had a specialist Buy To Let (BTL) lender refuse to lend to me because they felt the property was in a highly populated BTL area! They felt there were too many BTLs on that street.
It baffled me how I applied to a specialist BTL lender for a mortgage on a BTL property in an investment area and they said no !!
Sometimes the seller decides to remove the property from the market.
They have decided not to sell.
It could be for any number of reasons, only you might never get to know what the reason is.
Again you have worked so very hard to agree on this deal and lined up everything you need only to have it pulled out from under your feet.
It really feels like a kick in the teeth !!
It’s hard to accept only accept it you must and move on.
Don’t go looking for the reasons as you are just wasting your time and energy that you could use to find the next deal.
I once spent 2 ½ years on a deal.
I started talking to the owner who wanted to sell because he couldn’t afford the mortgage and had stopped paying each month. He lost his job and was in a tough place. The bank had written to him, only he was ignoring the letters.
But he showed them to me as he kept them !
He believed that if he stopped paying, the bank repossesses the house and his family would be rehoused into a council property. Unfortunately, this is not how it would work. I had to explain to him that in this scenario he had made themselves intentionally homeless and would go to the bottom of the very long council house waiting list.
While waiting they would be put in temporary accommodation which could be a room in a large facility or a grubby small Bedsit in very cramped conditions. It would also be somewhere they have space and not necessarily in the same town so the schools and work for his wife and children may not be the same.
On top of all of this, his credit would be ruined. After the house is repossessed it would be almost impossible to take out a loan, get credit on a credit card or shop card, or buy something on a payment plan.
I did try and talk to his bank with him on speaker through his phone. I suggested that I take over the loan on the house, they would not entertain this idea.
So at this point I strongly suggested that he get on board with the bank, respond to their letters, and enter into a payment plan with them.
He was Ex- Army, like myself, so he listened and did take the actions I suggested. This was the best immediate action for him and his family.
Now I never got the deal here, however, I did leave him with advice that will put him in a much better place than he was in.
This is the way I work and suggest you do too.
Being honest ethical and offering advice to someone who doesn’t have the knowledge you have, rather than taking advantage of their situation, is the only way to be in my mind.
There will always be another opportunity / deal around the corner!
He was grateful and we kept in touch. I left the door open also suggesting that should he still want to sell at some time in the future I would still be interested.
A few years later, he had got another job, caught up with the mortgage arrears and gotten back into a good place.
However, he still wanted to sell.
The house had gotten into a very bad condition over the 2 years so I sat down with him and agreed to pay him enough to clear the mortgage, a few debts, and money to help them move into a rented property starting afresh.
What did I do with the property?
Well, I put it in an auction and sold it for a small profit.
Everyone got what they wanted from this and that’s the best deal.
As a property investor for the last 20 years, I always try and find a solution when these challenges come up.
Not every deal works out, I have shown a couple that I did manage to sort out.
The ones that don’t you put down to the cost of business.
Remember you are running a business, a professional property investment business and there are costs with running a business. The next deal may well recover those losses!
It’s safe to say that all businesses have their ups and downs, and all business owners/entrepreneurs will need to find a way to bounce back from things when they go wrong and keep going.
That’s what will make your business successful.
Keep going …..
Neil Stewart
If you want to get in touch and have a 15 minute chat with me book it in my diary at :
https://cleverpropertyinvesting.co.uk/contact-us/