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.”
Instated 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.
Want more awesome tips like these in your inbox? Subscribe to our blog and never miss a week of Back to Basics tips and topics.