The use of questionnaires in real estate is quite common. In essence, these are lists of questions that help you gather the most important information by invetors, leads, and buyers, so you always have it on hand. Whether you’re trying to find a partner (or a lender), identify a good deal, or offer a property to a buyer, the questionnaires exist to ensure you’ll cover all important aspects of the operation before you take action.
And they are known under all sorts of labels: investor profile sheet, seller checklist, buyer lead sheet, and other alternative names. In this article, we’ll review three types of questionnaires: for finding investors, for processing leads, and for screening buyers. We’ll also provide a template for each of these questionnaires that you can tweak further if needed, so let’s get started.
This particular questionnaire serves to connect private lenders, venture partners, and investors with real estate entrepreneurs. The “investor profile” questionnaire is not unique to real estate investing – in one form or another, this checklist is used whenever capital and returns are involved.
There are two main reasons for using questionnaires to raise capital: it helps you to identify the right profile of investor, and it saves both of you a lot of time.
When you look for a way to raise capital or you aim at getting returns, you have to talk specifics. Companies and lenders all have their needs, goals, and also limits to what they can deliver. This is best done by running numbers, so that each side can determine whether they are comfortable working with one another.
For instance, if the projected returns from the investment or the level of risk are not acceptable for the lender, the lender can turn to other types of investment. On the other hand, real estate investors are interested to learn whether the lender can deliver cash on short notice, otherwise they’d go to a bank and not to a private lender. The questions that are included in the template for investor profile questionnaire below will showcase the type of numbers you want to run to find the right partner.
Apart from helping you find the right profile of investor, questionnaires are also time savers. In person networking takes time, social skills, and effort – you need to visit events (educational course, dinner, local REIA group meetup). There is no guarantee that you’ll find a partner who’s business goals match yours, though. In fact, you can spend 30-45 minutes talking to a private lender or an investor, only to find out that you two are not a great fit.
For example, you buy land, but they want to invest in multi-family rental properties; or you’re a house flipper, but they’d rather face the risks of wholesaling. Filling out an investor profile questionnaire will allow both of you to approach partners who are in the same market or people who prefer certain loan terms without wasting a lot of time.
There are, of course, also some negative aspects to basing your decision on entries in an investor profile questionnaire so let’s discuss two of them: biased matching and differences in risk perception.
If someone else is deciding whether your real estate investing business and a specific private lender match, that is a potential liability. Let’s say the “matchmaker” is a REIA consultant and they overlook a partner that is compatible with you – you end up talking to the wrong person. It’s a biased choice, whether you are making the choice on your own, or a mentor does it for you, and it’s even biased if AI helps you.
There might be something that stops you two from working together, but none of you can find that out from a form. The reasons can be trivial, like disliking their attitude, or serious, like them not being satisfied with your process for doing due diligence on a property. No matter how comprehensive your investor profile questionnaire is, some question that’s not included (there is always something left out) can be only uncovered once you meet and talk for a while.
Generally speaking, data from questionnaires is subject to interpretation, and investor profiling is not an exception. When you include a question like “what’s your risk tolerance on a scale from 1 to 10?” and they answer “7,” are both of you on the same page?
Risk perception is not expressed in numbers, and even if you put it in numbers it might mean totally different things to each of you. Perceptions are created by previous exposure to investments in real estate, life experience and upbringing, or social values – it’s a complex matter. A private lender might choose 7 because they’ve become more risk averse since a previous investment in which they expected high returns has failed, and you, as a real estate investor, might be ok with 7 because your calculations show that you can deliver that. But you can both be wrong.
Let’s consider an investor profile template.
If you invest in residential real estate, specify the preferred square foot or number of bedrooms of the property.
The focus in investor profile questionnaires is on the numbers. Yes, we mentioned earlier that figures are subject to interpretation, however, if you include multiple questions revolving around money strategically in the sheet, you can get a picture about the priorities of the investor. Of course, you can additionally tweak the template we provided, until it gets you the answers you need before you reach out to a particular lender.
You’ll probably deal with investor profile questionnaires only until you dip your feet in real estate investing. Once you bring returns to a lender through a successful project (for example, a flip) it will be much easier to raise capital. Check out what Jesse Trujillo shared on the 69th episode of our REI Marketing Nerds podcast:
I have investors that have been with me since many, many years … and their trust in me is huge, .. because I just feel like, man, you know, like they just, Hey Jesse, whatever you need – here it is. I’m like, oh, don’t you want to hear about the property? And they’re like, nah, it’s okay – we trust you – you know, and that’s very important to me.
In essence, the questionnaire for house sellers is used so that investors can determine whether a deal is worth pursuing. It is effective on more than one level, as it allows you to identify potential issues with the property and gauge seller motivation at the same time.
You can integrate a lead questionnaire for motivated house sellers into your website conversion strategy. This is a great way to let website visitors qualify themselves once they land on your website following an online marketing campaign. Because of this, the real estate investing questionnaire is also known as lead qualification checklist, lead questionnaire, or lead sheet.
Let’s check out the pros and cons of using it for lead qualification.
The chief benefits of adding a motivated seller questionnaire in your process are: the questionnaire is a time saver and the format of the form allows targeted questioning. Let’s elaborate.
In a way, the questionnaire is an equivalent to cold calling script for qualifying leads – the main difference being, leads fill questionnaires by themselves. That’s where the element of saving time plays a role.
Those of you who’ve done cold calling know that while the method itself is effective for building rapport, it’s also time consuming. Similar to what we noted about networking with investors above – you can talk to prospective house sellers for half an hour before a deal breaker pops up in the conversation.
And the act of talking over the phone itself is taxing, you need to have a specific personality type to do it for hours on end, otherwise it will quickly drain your energy. Not to mention all the house sellers who’ll rile you up or outright curse you out during the exchange.
Comprehensive lead capture questionnaires can be filled by sellers at their leisure. This will allow you to spend your time doing other, more productive work, like improving in house processes for your real estate investing company. No shouting matches or dealing with difficult people, which will significantly ease the process of filtering leads.
Speaking of filtering leads, the questionnaire allows you to ask targeted questions. This means that you can quickly sort leads based on a criteria of your choice (for example, a separate category for two bedroom houses).
Lead qualification through a motivated house seller questionnaire allows you to decide whether you have a potential deal on your hands. And if you craft the questionnaire strategically, you can immediately delegate the lead to a team member or assign the next step toward closing the deal.
The most simple way to explain targeted questions is the following: you ask a series of questions related to a topic without explicitly acknowledging the topic that is being discussed. It’s a method that’s used to educate pupils, and you can apply this method to educate your leads.
Why bother? Well, if you ask a direct question about the property you might not get a straight answer (the lead either doesn’t understand the question or they aren’t willing to provide an answer). However, if you reduce the main question to a series of seemingly unrelated inquiries organized in a deliberate line of questioning, you will make both yours and your house seller’s life easier.
For instance, let’s say one of the goals of your questionnaire is to check for potential code violation issues with the property. If you ask the property owner: “Does your building comply with zoning regulations for your ZIP area?” they might not have a clue what you are talking about. But, if you simplify the question as follows:
you’ll get the answer to the underlying issue of code violation. You can employ targeted questioning in the house seller questionnaire for every specific deal breaker (check the template below). And these are all straightforward questions – there is no small talk or icebreakers in questionnaires.
Two issues plague the use of questionnaires for qualifying leads: incomplete answers and false information.
There is a possibility that you will receive questionnaires with incomplete answers. The exact number of partially completed questionnaires (with many blank fields) will vary, but you will definitely receive them. And then, you’ll need to do what you wanted to avoid in the first place – talk to them (over the phone or in person).
The reasons for leaving blank fields in a lead survey vary, too. Maybe the question was ambiguous and the respondent didn’t understand what’s expected of them. Maybe the house seller is not motivated, they didn’t have the time to complete the questionnaire, or maybe they dread the process of filling a form. Yes, this is a real thing, and it’s called survey fatigue.
Whatever the cause, you are in a tough spot because you can’t even rule out a lead (or label it as a cold lead) based on a partially filled questionnaire alone.
This is the problem of self reported survey bias. The data in the questionnaire might be wrong – whether because the house seller purposefully tries to mislead you, or they honestly don’t have previous experience with transactions involving property, so, they aren’t able to provide a valid answer.
After all, just like addicts aren’t motivated to self-report substance abuse and, children aren’t motivated to confess their mischief, house sellers aren’t motivated to provide information that will reduce the value of their property. We reiterate this point on our blog on a regular basis: motivated seller leads are basically people in distress, it’s against their self-interest to disclose damning data.
You’ll have to do your due diligence on each piece of data in the questionnaire. Code violations, tax liens (or other liens) on the property, structural damage, the title of the house – all of it: incorrect property data can kill the deal.
With all that in mind, let’s check a template for a lead sheet list.
Miscellaneous comments (things we should know):
If a house seller took the time to fill in your questionnaire, it’s an indication they might be a hot lead. Of course, you still need to talk to them to determine how motivated they are to sell.
Keep things simple to get questionnaires without blank spaces. And avoid open-ended questions – this can’t be overstated. If the question can’t be answered with a straight Yes or No, then include multiple possible answers, each with a checkbox, so the respondents can easily select one of the offered options.
The lead questionnaire is the focal point for converting website visitors which were targeted through an online marketing campaign (PPC, Facebook Ads, SEO). Real estate investors tend to throw the comprehensive house seller questionnaire at traffic secured from ad channels. Though, if you want to employ a less aggressive approach, you can first use a short lead capture form (only personal and contact details) and offer the questionnaire as a second step in the lead’s journey within your funnel.
In real estate investing, the main struggle is finding motivated house sellers, but you can also use questionnaires for finding house buyer leads. Although buyer questionnaires are mainly used by real estate agents, investing – be it wholesaling, house flipping, or buying, holding and eventually selling – involves selling a property at some point, too.
The real estate buyer questionnaire is similar to the investor profile checklist (those are property buyers, too), but it’s more simple because here you target any prospective buyer. So, this questionnaire makes it easy to offer the right property to a buyer.
If you have an in house inventory because you manage many properties, a buyer profile questionnaire will make it easier for you to offer the right property to a prospective buyer. In this sense, the house buyer questionnaire is a time saver.
In reality, property buyers have many options for finding real estate that’s for sale. Buyers can go to a realtor and buyers can browse property ads to find whatever they want. If your inventory is low (for instance, only 3 houses for sale) there is no point in asking too many questions about the dream house of your buyer. Instead, send them listings: you can use your email newsletter, Facebook, and even Pinterest to send them your listings, in which case you don’t need a buyer questionnaire.
Those of you who are interested in property buyer questionnaires can check out the template below.
We discussed the drawbacks of using particular types of real estate questionnaires above, however let’s turn to some general issues about prospecting through checklists. You want efficient processing of leads, hence the questionnaires, but you also want to have optimal close rate.
There is a wealth of information which can’t be covered in a questionnaire. For instance:
You can’t build rapport by going through a checklist – no small talk, no icebreakers, and no way to learn what makes your respondent tick. You can’t drop a conversation starter (like FORM: family, occupation, recreation, motivation) in a questionnaire.
You miss out on non-verbal cues – questionnaires deliver numbers jotted in a lead form, but no other information about the respondent. During a phone call or an in person meeting, you can learn a lot about the lead through their tone of voice, pause in speech, and mannerisms. For example, if they exhale hard when you talk about the ask price, you know that the price is a sensitive topic.
It’s hard to gauge negotiable checklist items – questionnaires establish red lines way too early in the negotiation process. You ask them directly “what’s the lowest offer you’d accept?” and they can take a hard line approach, just because you forced them to do so. When you talk to house sellers, the flow of the negotiation comes natural.
Potential issues with accessibility – the respondent is not able to fill in the form. You can overcome this problem by using a mobile friendly design. Sometimes that’s not enough, because people might have trouble comprehending critical questions in the questionnaire, and give incorrect answers as a result.
That being said, you can always preclude your offer on the property with a disclaimer: “based on the information provided in the questionnaire.” Real estate investors give preliminary non binding offers sight unseen, it’s a standard practice. Such offers are subject to change based on actual property data, house inspection by property appraiser, estimate of rehab costs by contractors, etc.
Questionnaires are the ultimate time saving tool for real estate investors. You can use them to find lenders (investor profile questionnaire), to qualify leads (house seller questionnaire), and to screen buyers (house buyer questionnaire).
They are a great starting point for taking things further, but don’t base your decision on questionnaires alone. The answers provided by respondents
Make your real estate investing questionnaire easy to follow (craft as simple questions as possible). Focus on numbers with lenders and use targeted questions with property sellers.
As you both move further along in the process, and you schedule a phone call or a meeting, you can make an informed decision about the level of commitment you want to have with this person or the deal that’s at hand.
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