The Repeatable Deal Machine: Part 2 – The Tactical Q&A
Reading Time: 5 Minutes
Summary: Following her presentation at our April WIN event, Mel Dorman sat down for an unfiltered Q&A. While Part 1 covered the "why," Part 2 dug into the mechanics of sourcing, the "Green Flags" of a perfect seller, and the 3 Laws of a good purchase. If you’re looking to move from theory to closing, these were the heavy-hitting takeaways from the room.
Sourcing, Red Flags, and the 3 Laws of Seller Finance
The energy in the room shifted as investors began to pressure-test Mel’s strategies. Here is the tactical breakdown of the audience’s top questions.
1. Cutting Through the Noise: How to Source Deals
The most common question was how to actually reach these sellers. Mel’s answer was surprisingly low-tech: Handwritten letters.
The Strategy: Avoid the "corporate" look. Make it less about "me" and your credentials and more about truly getting to know the person and their specific situation.
The Dating Analogy: You don’t ask for a marriage on the first date. You listen for the pain points and build a bridge of trust before you ever talk terms.
2. The Red Flags vs. Green Flags
Not every property is a candidate for seller financing. Mel provided a "Cheat Sheet" for qualifying leads:
| The Green Flags (Move Forward) | The Red Flags (Proceed with Caution) |
| Concerned about a massive tax hit (Capital Gains) | Seller needs cash quickly |
| Enjoys passive income/mailbox money | Little or no equity in the property |
| Not interested in the stress of a 1031 exchange | Multiple heirs (can make the decision process messy) |
| Already understands the concept of private lending | Lack of mental capacity (Elderly protection is vital) |
3. The "3 Laws" of a Good Purchase
Mel emphasized that a seller-financed deal is still a real estate deal. To be a "good" purchase, it must meet three criteria:
Location: The neighborhood fundamentals must be sound.
Expandability: Can you add an ADU, partition the lot, or increase the unit count?
Terms over Price: In seller financing, the terms (interest rate, down payment, and length) are often more important than the purchase price.
4. Advanced Strategy: Mobile Debt & Right of Refusal
Two technical nuggets stood out for the seasoned investors in the room:
Make Debt Mobile: Structuring your notes so they can be moved or sold provides you with ultimate liquidity.
First Right of Refusal: Always include this term to protect your position if the seller decides they want to sell the note to someone else later.
5. The Learning Curve: How Long Does it Take?
How long until I'm actually doing this? According to Mel, it takes about 3 months to truly grasp the concepts (which she teaches in her Seller Finance Academy). If you are active and consistently "dating" your market, you should expect to be in serious conversations within 4 to 6 months.
The Bottom Line
The hardest part of seller financing isn't the math—it's helping the seller (and yourself) believe that it’s actually possible. By focusing on the "3 Laws" and looking for those high-equity "Green Flag" sellers, you can bypass the banks and build a "repeatable deal machine" right here in Portland.
