Maybe you’ve experienced one of these scenarios. The phone rings, it’s a buyer lead asking to see “555 I Got A Lead Place.” You jump like a pop tart, get in the car and meet them at the property.
They love it, they are there for over an hour. They thank you for showing them the house. They go on to explain that their agent was busy, but they are going to call her now to write an offer.
Or how about this one, you are working with a pre-approved buyer couple who has seen at least 50 properties. They have even written a couple of offers, but then called you and said they decided not to sign it. They just didn’t like the wallpaper.
Or the prospects who are not ready to buy but want you to show them 10 houses.
Or the one’s who want you to make an appointment at a house that is $100,000 over their budget, owner-occupied, and the owner has a newborn — but they want to see it.
I know you probably relate to at least one of those, so let’s talk about tips and scripts to master so you don’t waste your time, or theirs.
Turning leads into clients means knowing what to say, which questions to ask and having the expertise to provide information that can not be found from anyone but you. Creating loyal, ready-to-buy-now clients is one of the most important skills a real estate agent should master.
Unfortunately, most agents have a difficult time taking control of the client experience. Below, you’ll find three steps that’ll get your buyers to commit and help you never waste time with wishy-washy buyers again.
1. Get a buyer-broker agreement signed always, and don’t be scared
Internet leads are at the beginning stage of their journey (most will purchase in one to six months). They are receptive to working exclusively with a buyer’s agent, but only if we communicate our value to them.
The buyers we encounter don’t buy houses every day. Real estate is emotional, complicated and scary. They are not familiar with a buyer’s agent, how a buyer’s agent gets paid and what services we provide.
They need to understand the homebuying process. It is your job to make sure that happens.
Pro tip: The best question to ask is: “Has anyone ever sat down and explained the homebuying process to you?”
Then explain it, consult with them, and get an agreement to work together.
2. Have a pre-approval policy
In my brokerage I have a written pre-approval policy that I give to the client at the buyer consult. I set the expectations clearly. By doing this in our first conversation, I am setting the standard of practice.
Talking to clients about a pre-approval policy
Here’s an example of what you might say:
(Fill in the name of your brokerage) has put policy in place that requires potential clients to have a pre-approval, proof of funds if you’re paying cash or contact information from a reputable lender before we set up showings. This document will provide clarification of the policy as well as debunk misconceptions we come across daily. Soon, you will understand why this is important and the first step.
One must have pre-approval from a reputable lender. If you already have a letter, great. Just bring it with you to our initial meeting. You’re all set and ready to go. If you have a preferred lender, we can schedule a meeting to discuss your options. If you don’t have a lender, we will provide you with our lender list.
We don’t need any of your financial documents, pay stubs or credit score. That is what the lender will need. Our job is to find you a great home and negotiate the best price.
If a real estate professional doesn’t value their own time, can you expect them to value yours?
3 reasons to have a pre-approval policy
There are three reasons that this is necessary, and it doesn’t hurt to share these reasons with your clients.
- Time: We all have a certain amount of hours in the day to take care of a number of responsibilities. Time is our biggest limitation. By requiring documentation from the start, we make sure our clients are serious and prepared to succeed in the homebuying process. Our time with our clients is precious, and we want to make the best use of it.
- Safety: There have been sad stories in the news time and time again involving real estate professionals and tragedy. It is against our policy to meet unknown potential clients without first verifying that they are real buyers. This keeps our sales associates safe and creates a mutually trusting relationship.
- Create standard of professionalism: It is not in your best interest for anyone on our team to schedule showings or write offers on properties you do not have the ability to purchase. Without the documentation required, we cannot do our fiduciary to you and serve you to the highest level. This is not a standard in all offices. There are agents who will open doors for you at a moment’s notice. This is how they want to conduct business, which works for them. We are professionals, and we commit to our clients our time, energy, resources and expertise. Because we are so committed to our clients, we ask for a mutual commitment at the beginning of the relationship.
I have this system in place to qualify prospective clients based on their willingness to work with me and follow my proven process.
3. Get ’em signed
It is my hope that you always have a signed buyer agreement before you start working with a new client. Have a buyer consult and a packet that you go through that explains the homebuying process.
When asking if pre-approved, the question to ask is this: “Every seller is going want to know, so I need to ask this question: How do you plan to pay for this purchase? Are you paying cash or getting a loan?”
This is where you find out if they have a loan and lender in place or if you need to get them to a lender. You should have three to four lenders on a list that is in your buyer presentation packet. Offer to let them call one of them or to call and get an appointment set up for them.
Pull out the why pre-approval is important, and discuss who all the players are on the team and what their role is. Show the client exactly how this is all going to work.
Explain market conditions, how to write an offer, request for repairs, inspections, contingencies and earnest money. I have a blank contract with an agency disclosure; I explain agency and have them sign that.
Then I go to the buyer-broker agreement, explain that, and have it signed. I go through the contract briefly, so they understand the different sections, and they take it home in their packet. I make a copy of the signed agreements for them and keep the originals. It’s that easy.
Until the industry gets wise enough to change how buyer agreements are written, your challenge is to make the agreement work for you. The agreement should be the first step in qualifying buyers you work with.
Your buyer needs to be comfortable enough to commit to working with you exclusively for some period. And, they need to understand exactly how the real estate industry works. It will make your job easier and their experience richer.