It’s as simple as it sounds: a benefit list lists all the benefits associated with a deal or offer you’re making. This is a great tool I garnered from two of my greatest teachers: Peter Fortunato and Bill Cook.
Pete always talks about deals in terms of benefits, not money. There are lots of benefits associated with each deal that you can’t put a dollar amount on. For instance: emotional relief. We once bought a house from a seller whose main motivation was their grief over losing the grandparent who raised them. They inherited the house from the grandparent and decided to move into it and fix it up believing this would help fill the void they were feeling from the loved one’s passing. It had the exact opposite effect, however, and made matters worse.
In this case, money was not what they needed. Relocating to a place where healing could begin was the most important benefit. Once we were able to identify that, we showed the seller how we could help them and we were able to do the deal. Pete says that in this way benefits are the currency of life.
When presenting an offer, your job is to show the seller what benefits they will receive if they accept it. Bill taught me that you should include a statement to this effect in every written offer. He’d do this at the end by simply saying, “What’s in it for you, what’s in it for me:” He would then list all the benefits for both sides.
So what does a benefits list look like? Here’s one we included on a subject-to deal we facilitated in which the seller was moving to Maine. He couldn’t sell his house in its condition, and he didn’t want to be an out-of-town landlord.
Benefits to the seller:
- He can move back to Maine as soon as he likes.
- He will continue to have a positive, performing account on his credit report.
- He won’t have to worry about tenants or rental repairs.
- Since it’s not a rental, he won’t have to worry about lawn maintenance, utilities, covering the mortgage payment during vacancies or having to try to find a good new tenant while he’s living in Maine.
- He won’t have to put another dime into the house to sell it.
- He also gets finality in a situation that seems bleak.
- He gets the satisfaction of knowing a new family will be raised in the same place his was.
Benefits to the buyer:
- They’ll have a place of their own to bring their new baby home to sooner than they otherwise could have.
- Since this is a subject-to deal, and needs work, they will get to start owning the house while using sweat equity to increase its value.
Benefits to the agent:
- He gets the satisfaction of helping his friend sell a house that was otherwise unsellable.
- He will have outshone his competition in the eyes of his client.
- He makes a commission.
Benefits to Joey
- He helps his extended family (the buyers) get into a home.
- He gets the satisfaction of helping the seller get back to his family in Maine.
- He helps the agent get paid.
- He gets bragging rights for putting what seems like an impossible deal together.
In this case, all parties could clearly see how this deal could benefit them. Notice too that most of the benefits didn’t revolve around money.
And if you’re still wondering if benefits are a currency, this list was the medium of exchange that allowed this deal to happen.
Pete says if people don’t see the benefits, they won’t do the deal. But if you show them how they can benefit, you’ll be surprised at the creative deals people will agree to.
If you’d like to learn more about how to put creative offers together, Bill and Pete will be teaching their creative deal structuring course, titled “What Box”, at the Atlanta Airport Marriott on September 16th & 17th, 2017. For more information and to sign up, visit www.peterfortunato.com or call Kim Cook at 770 815-8728.
Joe and Ashley English buy houses and mobile homes in Northwest Georgia. For more information or to ask a question, go to www.cashflowwithjoe.com or call Joe at 678-986-6813.