Written by Jeffrey R. Armstrong – President/Owner of Armstrong Capital
Your favorite Master Note Buyer – Straightforward, Honest, Fair…
One of the most overwhelmingly common questions that brokers asked me is, “How did you become successful in this business?” and “What can I do to be successful in this business?” Well as everyone that attended my sessions knows, when I started in this business they only taught us about seller financed or private mortgages. At my training class there was no factoring, business notes, equipment leasing, medical receivables, or any of the 60 or so other cash flows that are now available. If I was going to make it at all it was going to be in the private mortgage arena.
Some of my success I attribute to my own self-motivation. I highly recommend a book by Napoleon Hill entitled Think and Grow Rich. I have read this book from cover to cover at least a dozen times in as many years. I first read it around the end of high school and the beginning of my college days. It inspires me and refreshes my thinking each time I read it. Two other books that have recently kept me on track are The Millionaire Next Door and The Millionaire Mind by Thomas J. Stanley. There is something about knowing how a millionaire thinks and what a millionaire does that keeps me reaching for that level of wealth.
Characteristics That Lead To Success
Product Knowledge: One of the characteristics that I think you need in order to be successful in this business, whether you are working in the private mortgage area or any one of the other cash flows, is Product Knowledge. You must determine what the seller needs and then be able to choose the product that will fit that individual seller’s situation. When working with private mortgages some of these products are a full buyout, partial, multistage, reverse partial, short life yield, and a split. Every seller is different and unique and it is your job to figure out which product will work best for him or her. You do not want to limit yourself to just offering every seller a price for the whole note. At least half of the transactions that I have done over the last 10 years have been some type of partial or something besides a full purchase of the note.
Calculator Skills: In addition to product knowledge I think you must have, at a minimum, good Calculator Skills. If you cannot figure out what the payment amount is on a note, what the current balance is or what the balloon payment will be at the end of a note you had better start practicing. Every time a potential note seller calls you and gives you the pertinent information to fill out a mortgage worksheet you should enter the information in your calculator and recheck the numbers that they gave you. Is the payment amount correct with the interest rate that they gave you? No? Maybe the term is longer or shorter or maybe the interest rate is different. Every time a Master Broker or Funding Source gives you a price for a note, enter it into your calculator and try to figure out how they came up with that price. As you practice these things you will become more proficient and have a better understanding of each situation.
People Skills: Another characteristic that may not be that easily learned is People Skills. You, as a cash flow broker, need to know how to build rapport with potential note sellers and clients. You need to know what to say in certain situations when you are negotiating or when they ask you a question. You may have to talk with someone many times before you finally get a yes and start a transaction with him or her. For example, a simple thing that I do is I always try to smile when I am talking on the phone. For some reason a person has a more pleasant voice when they are smiling. Try it!
Confidence: When you have the product knowledge, the calculator skills and the people skills you will begin to develop Confidence. If you are not confident in yourself and your business skills it will show. Confidence is a key characteristic that I think leads to success. Learn as much as you can about whatever cash flow you are interested in, take courses, read books, and call Master Broker’s and Funding Sources to ask questions. When you are talking with potential note sellers and clients speak with confidence. Even if you don’t know an answer to a question you can still say, “I’ll get back to you on that”, with confidence.
Persistence: If I had to pick the one characteristic that has personally lead me to success it would have to be Persistence. I knew deep down inside that this business would work and I didn’t stop trying different marketing methods and different ways of doing business until it did work. You need to have a burning desire to succeed and not stop until you do. There will be bumps and potholes, there will be hills and valleys, there will be changes and there will be new generations, but if you keep at it you will be successful. As a cash flow broker today you need to understand that this is a business and, like any other business, it takes time for a business to grow and develop. So get out your books, go over all of the information you have, find a cash flow or two that interests you, pick an area that you think you will like working in and keep at it! Persistence pays!