Jewels of Wisdom Newsletter – Master the 5 Steps of “Deal Making”

Posted on August 18, 2025
In Jewels of Wisdom Newsletter

5 Steps of “Deal Making”

There are 5 steps to close a real estate deal listed below. Increasing your skill at each of these 5 steps offers you the chance (not entitlement) to increase your earning power. Failing on any of these steps means a Dead Deal.

Finding the Deal – Once you decide on the asset class you’re going to buy, you need to build a pipeline of opportunities which you can work the remaining 4 steps. Developing a strong network of brokers in that asset class is a good place to start. H
Underwrite the Deal – Know your position in the deal. What must occur for this deal to be a success for you? For example, buying a fix & flip deal you must know what it will sell for after repair, how much repair is needed, and what your anticipated profit will be at your target purchase price. You are better when you underwrite your 1,000th deal than when you underwrite your 1st-the key is many repetitions.
Structure the Deal – The easiest structure for most deals is “cash at closing.” It gets the job done and it’s easy to negotiate (see step 4). However, many of the best deals in real estate (for the buyer & SELLER) have a seller financing component. If you’re selling a building you’ve owned forever and earning a $1M taxable event (aka-profit), it might be better for YOU to hold a mortgage for that $1M at 5% interest only (better than the 3.25% at the bank-AFTER you pay the tax bill) and receive $4,166.66 per month without eating your $1M principle.
Negotiate the Deal – Once you decide your offer price & terms, you then find the best way to position these to the seller. In step 4 above, you’ll notice a short example of how to position a $1M seller finance deal to a Seller. It is a good deal for the seller, and I’d personally love this deal if I were selling and facing a $1M taxable event.
Close the Deal – Seems obvious, but you might be surprised at how many deals fall apart before closing. Buyer or seller get cold feet, or new information arises and the deal dies. Skilled Deal Makers learn how to keep deals on track to close.

The Diamond Equity team always welcomes a true Deal Maker to join the team. If this is you, or you have a strong desire to become a skilled Deal Maker, feel free to reach out to me directly.

I’m Always Making Deals on the Following Asset Classes: (aka- I’M BUYING)