Six steps to generate unlimited real estate agent referralsOliver Maldonadoreal estate agents, referrals, leads Mortgage professionals around the country have begun to face the challenging times ahead with the refinance boom coming to an end. Now that the boom's over and rates are continuing to rise, originators are wondering if they'll ever be able to duplicate the success they saw during the boom or if they'll just have to learn how to make do with less income. When rates hit 40-year lows, it was easy for most originators to switch their focus to the low-hanging fruit of the boom market. Even those who generally didn't focus or target the refinance market got caught up with refinances and put everything else on hold. Now, the time has come to start targeting other markets and find the new low-hanging fruit, although it may feel as if it's all been picked away. There's really more business out there than you can handle. You just need to know where it is and how to get it. Managers and industry experts are all saying that to make money in this market, you'll have to recruit and work with real estate agents. You'll have to go out there and start building relationships with real estate agents and get them to refer to you their purchase clients. They're right! But as many are learning, most of them don't have a good enough system to make this happen. Even though the refinance boom is over, there are still millions of consumers who are purchasing new homes for the first time, while many others are upgrading or downsizing their current homes. The purchase business will always be booming! This leaves a tremendous amount of opportunity for originators. Although the rates have been dramatically rising and will, most likely, continue to rise for quite some time, there will always be a market for purchase business. Many of you might have already tried to work with real estate agents, with no success, by dropping off rate sheets, promising better service and even buying them pizza and doughnuts, and they didn't even give you the time of day. Because of this, most originators are starting to believe that they're just not going to be able to work with real estate agents. The best way to work with real estate agents is if they need you, instead of you needing them. Then they'd call you, instead of you having to beg them for business. Imagine having more mortgage applications and leads than you could handle and not having to worry about where rates are today. Better yet, imagine all of your new business being referred to you by established real estate agents who are anxiously waiting to refer their clients to you. There are six steps that you can follow to make this happen for yourself. Within 30 days, all of your business could be coming in from real estate agents. The reason most originators haven't tapped into this real estate agent-based referral lead source is simply because they don't know how. We've all heard the horror stories of how difficult real estate agents can be. It's scary to think that we'd have to depend on real estate agents that are difficult to work with and who also have a tendency to be verbally abusive. The reality is that you don't have to work under those circumstances and with people like that. I've also dealt with many real estate agents who weren't pleasant to work with, and I've learned that I should never work with anyone that I don't enjoy working with and who doesn't appreciate working with me. This is one reason why most mortgage originators have come to think of real estate agents as being difficult. Think about it. Imagine you were a real estate agent who received between four and six calls on average per week from mortgage originators claiming to have the best service and products. If that weren't enough, you would have these other mortgage originators coming in weekly to drop off rate sheets to add to your already large stack, asking you for something of value because theyre so special. Although you're onto them and know that they're desperate and begging for business, they continue. So when the rate sheets, mailers and faxes don't work, they'll get an even brighter idea and start bribing you with doughnuts. But since they brought doughnuts, they feel as if you owe them. How would you feel if this were you? Would you feel that excited about seeing or even hearing from another mortgage originator? And when they catch you off guard and reach you, will you be pleasant? Of course not! If this is the case, how in the world are you going to be able to generate real estate agent referral business? You might even be wondering why any good real estate agent would send you business, since most real estate agents already have established relationships with mortgage originators. There's only one reason real estate agents are going to send you business. Think about it. If they send you referrals, they're giving you something of monetary value. That's why no real estate agent is going to just give away referrals. So if they're going to give you something of value, shouldn't you give them something of value as well? I mean something tangible - something other than rate sheets, promises and doughnuts. They already expect those things when they make referrals to other originators. So if you're expecting to create relationships with real estate agents without giving them anything of value, then you're right - they're not going to refer you any business, and you'd better be prepared for a lot of rejection. The fact is that real estate agents would rather create new relationships with those who have something that they need, instead of staying with those they know, merely because they've worked with them in the past. So what is it that you can bring to the table that's valuable to get real estate agents to come to you? It's the same thing that you're looking for - referred business in the form of listing and comparable market analysis (CMA) leads. But first, there are six steps you'll need to follow in order to generate an unlimited amount of real estate agent-referred purchase business. Follow these six steps to start creating real estate agent partnerships. Step 1: The first step is that you must get the real estate agents to call you. In other words, they must first want to work with you. This is very important. As I've mentioned before, they've been bombarded by this person and that company, and they've all said the same thing. The reality is that the real estate agent market is saturated by that method, so you must now get them to come to you. This way, they'll have trust, since they made the choice to come to you, which you actually facilitated. The first step seems easy enough; but again, how are you going to get them to call you? You'll do that with Step 2. Step 2: The way you get real estate agents to come to you is by also giving them something of value, by referring them listing and CMA business. This is the only way to really generate and create business with real estate agents. Remember, the good real estate agents are already working with other mortgage originators. Even though they're working with these other originators, they're definitely not going to turn down new leads and new business. As I've traveled the country training real estate agents and originators alike, I've come to know that most of the relationships real estate agents have with other originators aren't because the originators help their businesses or provide anything of value, but because the real estate agents are comfortable with those theyve already been sending business to. In almost all of the real estate agent/originator partnerships I've seen, most are not based on the mortgage originator generating the real estate agent new listing and CMA business; so it should be relatively easy to start a new partnership with a real estate agent. Listing and CMA leads are very important to real estate agents. If you peruse several real estate agents' sites, you'll soon get the idea, as almost every single one of them talks about a CMA or asks if a homeowner would like to know the value of his home - and for good reason. Most homeowners, regardless of whether they're in the market to sell or buy a new home, are interested in what the values of their homes are and what other homes in their areas are worth. Almost every homeowner will someday need the services of a real estate agent to list and sell his current home and help him buy a new one. Although there will be many homeowners not looking to sell their homes, they will be good future prospects for the real estate agent, and the real estate agent will have already established a relationship with the prospect. So generating listing and CMA leads from homeowners is a fairly easy thing to do if you use a proven system. Now you must be thinking, "How am I going to generate new listing and CMA business for a real estate agent?" You'll find out how to generate the listing and CMA leads in Step 3. Step 3: There are a couple of ways to generate these leads, such as cold calling or even having canvassers go door to door generating CMAs, but one of the most successful and easiest ways I've developed is with a direct mail piece, which generates an amazing response! The mail piece is a copy of the first page of each homeowner's deed, with a return postcard requesting a CMA that he'll fill out and send back to you. The piece is so successful that out of every 100 pieces mailed, I'll typically get eight to 12 returned, each asking for a CMA on the home and a call back from a real estate agent. At a cost of about $40 dollars, I generate between eight and 12 real estate agent leads. The cost per lead is between $3 and $5. This is a very inexpensive and effective way to generate business that you're going to use to create new real estate agent partnerships. Now that you have a successful way to generate a consistent flow of new listing and CMA leads, you're ready to start meeting with real estate agents. Step 4: Once you've got some listing and CMA leads that you need to refer to real estate agents, the next step is to find the real estate agents who you would like to work with who you know will also be able to refer you mortgage business. There are criteria that you're going to use in selecting the right real estate agents for you. You must remember that you now have something of value for them, and you should be very selective in selecting whom you'll be referring your leads to. Part of your selection will be real estate agents who work in the areas you want to work in. It is also important to find real estate agents that have only been in the business for two to three years and are new enough to need more business, but not new enough to not know what they're doing. Real estate agents in the business for two to three years are established enough to have some business to refer to you, yet new enough to have a necessity for you and the ways you can help their businesses grow. This is the step where you're going to create a database of the real estate agents you want to work with and call them to let them know that you have a couple of clients you'd like to refer to them. You see, most likely, you won't have a chance to speak with them. They're going to screen your call, and you'll get their voicemail systems. So each message you leave should not ask for business or a meeting. Each message you leave should make it clear you have some referrals available. This is when almost all of the agents who you leave a message for will call you back. Once again, this is part of the game plan, and they'll be calling you back because they want something from you. Remember, this system is based on this primary principle of getting them to call you for something that they want from you. In the past, you may have had difficulties getting real estate agents to return your calls or even meet with you, but once you have some referrals for them, you'll see how easy it is to get them to return your calls and set appointments to meet with you. Now, they'll want something from you. Step 5: Agree to meet with the agents who you want to meet with that want something from you. These meetings are where you're going to let them know you'd like to refer them two to three listing and CMA leads per week! Now, you're helping their businesses and putting money in their pockets! In return for your referrals to them, let them know you'd like them to refer to you their clients who are looking to get pre-approved for new home purchases. Step 6: Enter into a partnership with each real estate agent where you both agree to do business together. I've always had each real estate agent sign an agreement with me, stating what he can expect from me and what I expect from him. To this day, I've never had a real estate agent not sign the agreement with me. I created the agreement so that both parties can be secure in knowing what we could expect from each other, and also so we both know how serious we are about our new partnership. Neither party wants to waste the other's time, and through the agreement, we both have a clear understanding of what we're looking for. Now you'll be able to call the shots and decide which real estate agents you'd like to work with. Once word gets around that you're generating leads for real estate agents, they're going to start calling you to get in on it. In some cases, you'll be able to set up real estate agent partnerships with several real estate agent branches, where entire offices of real estate agents will use you for their mortgage needs. Now you have a successful system to generate new real estate agent partnerships. Oliver Maldonado is the author of "The Greatest Sales Book in the World," "The Mortgage Book" and "The Ten Sales Commandments," and is a national sales trainer for RealtorPartnershipSystem.com. He may be reached at (720) 364-1884 or e-mail [email protected].