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Rules for Realtors
by Doug Huggins

For mortgage professionals working with Realtors can provide a great source of business.  There are drawbacks however such as maintaining control of the situation and making sure the relationship is beneficial to each other and the client.  Here are some strategies for keeping on the right track.

Many of the questions I was asked yesterday revolve around three issues:

One, "how do I select an agent to work with?";

Two, "how to I locate an ideal agent?"; and

Three, "how do I control the agent once I've referred my mortgage client to them?"

I'm going to answer these questions in reverse order.

In this dose of The Prescription, I'll answer question Number Three, and in tomorrow's dose, I'll answer questions One and Two. The reason for this will become apparent as you read, but suffice it to say, if you know how to control the agent, selecting and locating them become much easier.

So, How Do I Control the Agent, once I've referred my mortgage client to them?

I have a set of Rules that I use; and I have a simple conversation with the agent about "The Rules."  Here's how that conversation goes:

"Hi, this is Doug Huggins with The Home Ownership Center. I have three pre-approved ready, willing and able first time home buyer clients who want to own a home in your market area. We have already pre-approved them, that is pre-approved not just pre-qualified them, for a home loan. I'm looking for a reliable agent to work with these clients. Would  you be interested in working with ONE of them."

Do you see the power in what I just said?

First, I have three home buyers - in other words, I'm a leads source.

Second, these leads are ready willing and able - I won't waste your time with "leads". I have real live honest to goodness Buyers.

Third, My clients are Pre-Approved - I'm a mortgage professional and I've already done most of my job.

Fourth, I'm looking for an agent to work these clients - I'm in control, and these people are not just leads, they are MY clients.

Fifth, Would you be interested in working with ONE of them - I'm in complete control and I'm testing you.

At this point one of two things will happen. The more aggressive agents will ask about the other two clients, and the less aggressive agents will begin to shake (in some cases you can actually hear them shake over the phone).

You continue:
"I'm testing agents in the area to see if we are compatible so I can send an ongoing flow of pre-approved buyers to them. The primary issue is are you willing to play by my rules."

Here are "The Rules"

1. I do not complain about you making 5, 6 or 7 percent, do not complain about my fees and income.
    

2. Do NOT refer My Client to any other mortgage company or your best buddy in the mortgage business to "comparison shop." I guarantee you that if you cause them to comparison shop, I'll make certain they comparison shop you.
    

3. I will tell you exactly and specifically what the buyer can qualify for, what type of loan it needs to be and how much closing cost the seller needs to contribute to make the loan work. As long as you bring in a contract within that "box" , I'll get the loan done. DO NOT come back in a couple of weeks with a contract purchase price  $9,000 above what I told you they could qualify for and then blame me because I couldn't get them approved.
    

4. Do NOT take MY Client into a subdivision, development or community where the seller will only pay closing costs if MY borrower uses the seller's preferred lender.
    

5. I will not bad-mouth you and your profession. Do not bad-mouth me and my profession.
    

6. I fully expect a quid-pro-quo. That is, I'm giving you a fully approved, ready willing and able buyer. I expect an approvable referral from you. Not someone who has been shopped to your five favorite mortgage people who can't help them, and you're tossing them me as a "bone." I want your next best prospect.

"If you can play by my rules, you will receive an on-going flow of buyers. If you can't or won't - there are at least another 5,000 licensed agents out there who will. Your choice."

Those are the rules.

You don't need to deliver them rudely or arrogantly. You DO need to deliver them with confidence and pride. If you show any weakness in your delivery, if you waiver on any point, the agent will seize on that like a shark to chum. You will loose control from the get-go.

I'm often asked the question,
" Have you ever had any agents not agree."

Certainly!

I've had agents tell me, no-way, they are already working with a mortgage originator and will not change, but I can still refer the buyer to them.

YEAH RIGHT!

(Arrogance is NOT a virtue - it's an expensive stupidity.)

In tomorrow's Dose of The Prescription, I'll answer questions One and Two:

Question #1: "When I need to refer a mortgage client to an outside real estate agent, what criteria do I use to select that agent?" and

Question #2: "How do I locate the right agent?"

By the way...

Whenever I deal with any real estate agent, I want to work with them from a position of strength and power, not hat-in-hand begging for business.

The ONLY way to do that is either own the real estate company or to have an ongoing flow of approvable purchase money clients that you can refer to agents.

The age of courting real estate agents with R & D is Over.

R & D - "Rate Sheets and Doughnuts"

You MUST have an ongoing flow of quality leads in order to control real estate agents!

Marketing Systems by Doug Huggins
 

Rules for Agents Article
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