Back to Basics: 3 Tips to Build Better Real Estate Agent Relationships
As a loan officer, you might wonder if it’s important to build strong real estate agent relationships. These facts from the National Association of Realtors Profile of Homebuyers and Sellers 2017 provide insight to this question:
- 87% of homebuyers used a real estate agent
- 22% of buyers received a “Better Lender” list from their real estate agent
- Only 8% of homebuyers contacted a lender as the first step in the homebuying process
With so many homebuyers using a buyer agent and so few starting with a lender, it makes sense to develop better real estate agent relationships. The better a relationship you have with a real estate agent, the better chance you have of getting referral business.
Initiating a relationship with a new real estate agent can be a daunting task. Here are three tips that can make your efforts more fruitful and enjoyable.
Don’t Be Great, Be Different
Often, I hear loan originators state that they “are great.” They have “great rates,” “great products,” and “great customer service.” Saying you’re great is meaningless because being great is your expected baseline.
The thing is, every originator’s website claims the same thing – they have great rates, products and customer service. If you’re all saying that, then there’s nothing to differentiate you from the rest. Nothing for a real estate agent to grab onto to say, “I want to work with this LO.”
Instead of laying claim to your greatness, lean on what makes you different. Here are some ways to think about framing how you stand out.
Your differentiator should be provable or measurable.
Don’t tell an agent that you work with first-time homebuyers; tell them of the first-time buyers you worked with last year, you closed 98% of their loans.
Don’t tell an agent that you provide excellent service; show them a stack of thank you notes from happy customers.
We took those phrases from vague to tangibly measurable and provable.
Agents want transparency and touchpoints.
Don’t talk about internal processes, lingo or acronyms, all things that can make an agent feel like you’re hiding something. Instead, give the agent access to a shared folder for the buyer’s loan so they know how everything is progressing.
If You Never Ask, You’ll Never Receive
An excuse I hear frequently from LOs is, “I don’t call on that real estate office because they have an in-house LO.” Interestingly, those in-house originators have often asked me how to raise their capture rate. In my experience, those in-house LOs have a capture rate below 30%.
What I’m saying here is that in-house LOs aren’t closing as many loans for their respective real estate agents as you might think. That means you have over 70% of a market left to capture.
Instead of hoping for an agent to get in touch with you about a loan for a client, ask them! No agent will read your mind and think they should send you a new customer because you want one.
If you consistently ask the real estate agents you know if they have a client you can help, you’ll capture more loans by staying top-of-mind and available for those agents.
Market to Listing Agents, Too
Until this point, we’ve only discussed how to better relationships with current buying agents.
While you should treat buying agents as a critical part of your loan pipeline, there are more agents involved in homebuying transactions. That’s why you should also spend some time on developing relationships with listing agents.
Why listing agents? Because listing agents could be buying agents tomorrow. By getting in front of them to demonstrate your skills and reliability early on, you’ll stand out amongst your competition. When a listing agent eventually becomes a buying agent, they’ll know you and be more inclined to send their buyer your way.
Listing agents also want to see the loan close on the home they’re selling because that’s how they make their commission. If during a transaction the buying agent is having trouble with the current loan officer and the listing agent knows your name and reputation, he or she is likely to send the borrower your way.
Building Real Estate Agent Relationships, One Step at a Time
Remember, Rome wasn’t built in a day and neither are your real estate agent relationships. You can build stronger relationships with real estate agents by:
- Highlighting how you’re different from other LOs, not that you’re great
- Consistently asking real estate agents how you can help them to stay top of mind
- Marketing to listing agents because some days they’re buying agents, too
Being fastidious in these efforts will strengthen your current real estate agent relationships, help you create new ones, and, ultimately, help you originate more loans.
An eye opener. Very good
If you’re brand new to the industry, how do you promote how great you are when there’s really no proof of it yet? I don’t have those numbers to back it up.
Let them know that your branch is awesome and have a history of closing the transaction quickly and effectively. You are only as good as your branch.
This is really good! Thank you.
Having a good relationship with your real estate agent I do believe is a good idea. Now as you said, there was quite a substantial amount of homebuyers that used a real estate agent so it makes perfect sense that you’d want to capitalize on that. If I was to pursue a career as a loan officer, I would for sure see about staying good friend with as many real estate agents that I could find.
I like your tip about Rome not being built in a day. It really wasn’t and took a long time, probably years. I guess I can see the relation to the passing of time and you being a really good realtor.
As you said, you should always ask to talk to the real estate agent. Chances are, they won’t do it to you as they are quite busy. If I had to get one, I would for sure do that so that we could keep the communication between us.
I like your tip about constantly asking real estate agents for client help. That would make sense considering you want to build trust and success with as many agents as possible. I’ll have to consider your tips so that I can get good at real estate.
As always these tips from “The MI Guy” are right on target. Meaningful and specific suggestions we all need to be reminded of once in a while?
I love what you said about marketing to listing agents. Working with a real estate professional is a great idea. I’ll be sure to find the best agent available if I ever buy a home.
It is interesting that 87 percent of people use a real estate agent when buying a home or selling one. That is good to know because I want to sell my home soon. It does seem like I should start looking for a good agent.
I love your real estate tips. My wife and I are thinking about moving. I’ll have to consider getting a real estate agent to get a house.