Dr. Phil speaks with guests about how to negotiate for what they want.
Elizabeth is a self-proclaimed pushover and says negotiating makes her feel scared and uneasy. "I just don't always know how to handle myself," she says. For example, when she went to buy a car, she explains, "I kept thinking, 'I cannot afford this car payment.' But the guy was so nice, I just didn't want to let him down."
Scared about making the biggest purchase of her life — a condominium — Elizabeth wants help. "I want to go in there and get what I want, but I don't have the skills right now to do that. I don't want to blow it."
Dr. Phil plays a clip of Elizabeth looking at condominiums. When Elizabeth is looking at one, she doesn't ask the realtor any questions.
"She said [the seller] is taking a job out of town and he's moving. Did you want to know more about that?" Dr. Phil asks.
"Should I?" asks Elizabeth.
Dr. Phil turns to Herb Cohen, an expert negotiator, to explain why it's important to find out the seller's motivation. "Why is he moving? Where is he going to? In other words, if he's moving to a smaller place, he may not be able to take all his furniture. You could offer to buy the furniture. You want to differentiate your offer from any other offer," says Herb.
"There are so many things motivationally that you could learn there," says Dr. Phil. "If he's moving, he might think, 'I'd love to close this deal before I leave town.' So you could offer the deal today, with a 24-hour turn around. That might appeal to someone who's leaving." Tip: Find out the seller's motivation.
In another clip, Elizabeth "oohs" and "aahs" over the place and agrees that her furniture would fit there.
"You're falling in love with the place just standing there," says Dr. Phil. "You don't have to tell them everything you're thinking. Like Herb says, 'You can love it a little bit, but don't love it a lot.'" Tip: Don't reveal your true feelings.
In another clip, Elizabeth and the realtor are talking money.Elizabeth:
"I would like for the price to go down even more. I would prefer 110K."Realtor:
"OK, now the difference between 110K and 119K over 30 years is nothing. There's a $40 a month difference. So do you see yourself in a condo for 119K?" Elizabeth:
"When you present it that way, yes I can."
"It's nothing?" questions Dr. Phil. "Yeah, at 6 percent interest for the life of that loan, it's $14,480." Tip: Stick to your budget.
Herb adds, "Realize you have enormous power. You have a fungible commodity: money. And money talks and money walks. Also, you're dealing with the asking price. They don't want that. If they wanted that, they would call it the wanting price. Realize this is a game. Have some fun. You have so many more options, if not this place. Don't get emotionally attached to it."
Dr. Phil sums it up: "You have to be willing to do your homework, ask the hard questions, don't fall in love, set a price you're willing to spend and don't go a penny more."