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With financing such a critical component of the home buying decision, panelists participating in a webinar presented by NAHB's National Sales and Marketing Council told listeners that they needed to understand the financing process and know how to explain it so they could better reduce the fear of it among home buyers and close the sale.
“The goal is to open up the conversation to get buyers out of the fear stage and into the emotional stage of why they are purchasing a home,” said Anthony Grasst of MetLife Home Loans during the NAHB webinar, “What Salespeople Need to Know About Financing,” on June 8.
“If you understand financing as one of the critical components in selling a home and you are able to effectively communicate it to your buyers in a meaningful way, you will have more success in your sales than your competitors,” he added.
Grasst said that top salespeople know how and where financing fits into the sales process and they identify financing solutions beforehand and practice how to present those solutions using sales scripts. He said they also develop questions to ask buyers to get the pertinent financial information needed to make the sale.
“Train your salespeople to write their dialogue and practice asking, telling, trial closing and closing each part of the buyer’s checklist,” added webinar panelist Chris Seung, CSP, of Customer Connected Sales Training.
But Grasst said many salespeople mistakenly avoid preparing themselves on financing because they are intimidated by the process or don’t want to be involved and prefer to have the lender take care of everything.
He noted, however, that the most successful sales teams are the ones who work with the lender during the sales process.
Cooperating will reduce surprises and help the process advance more smoothly, agreed Seung.
“You need to know what your loan officer is saying to your prospects,” he said. “Tell the loan officer what you want, as a new home salesperson or builder, to make the experience the best it can be for your buyers.”
“Buyers who have a good experience usually generate referrals for that builder or even buy from the builder again,” he said.
Salespeople also need to explain financing in language that buyers can comprehend.
“Most buyers don’t understand what it means when you are offering 4.5% and the market is at 5%,” said Grasst, adding that salespeople can close more sales by explaining the intricacies of financing in clear terms.
Grasst also cited the advantages of explaining how buyers negotiating with builders can reduce their monthly payments without the builder reducing the purchase price of the home. He said that builders, rather than reduce the sales price, apply the negotiated difference to the downpayment. As an example, he said that applying a 3% purchase price reduction to the downpayment instead of the sales price could actually reduce buyer monthly payments by 11%.
Looking at the financing this way, Grasst said, a salesperson can create value and urgency by claiming that the buyer now has “the same payment as a home costing $27,500 less” or that the buyer can save “$48,600 in interest savings over the life of the loan.”
Buyers can more easily relate to financing — and savings — when they are presented this way, Grasst said.
“For many home buyers, financing is the biggest fear and obstacle they have to purchasing a home,” said Grasst. “If you as the salesperson educate yourself, then you can also educate your buyer and take that fear and trun it into a reason to buy.”
Webinar replays are available from NAHB. The fee is $19.95 for National Sales and Marketing Council members, $24.95 for NAHB members and $44.95 for non-members.
To purchase a replay, click here.
For more information, email Tamsin Ayre at NAHB, or call her 800-368-5242 x8673.
“Think Sold! Creating Home Sales in Any Market,” available at NAHB BuilderBooks, is a practical, how-to guide for developing the self-awareness, knowledge and skills needed to succeed in the competitive field of new home sales.
The book covers everything from the home buying process and new home financing to strategies for making better sales presentations and sizing up the competition. It teaches readers how to overcome customers’ concerns and provides specific examples of how to explain the benefits of new home features in customer-friendly language.
“Think Sold” provides insights on how to approach sales and life from a position of optimism that will create successful outcomes; how to improve upon potential customer prospecting and follow-up skills; and how to communicate effectively with various types of buyers and learn how to adjust communication strategies to increase rapport and alignment with buyers’ motives.
To view or purchase this publication online, click here, or call 800-223-2665.
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Click here to learn about membership benefits of the National Sales and Marketing Council and the Institute of Residential Marketing.