Referrals-Friends and Family Plan
Updated: Feb 26, 2019
Some people say never do business with family and friends. I have never disagreed more. Supporting friends and family over random strangers has always been a no brainer for me. Not to mention, I feel like I give and get better service with people I know. As my peers begin to have families of their own, it becomes even more close to my heart to make sure my money goes to the people I care about instead of someone I found on yelp.
I think where this “keep business separate” idea came from is unfortunate. I believe that a select few people treat people close to them worse than a customer should be treated, because those are the people who will understand. I optimistically argue that this is an outdated problem. Now that so many people are business owners, I believe that it’s now the norm to treat loved ones even better than the standard simply because we care about them on a deeper level.
I can speak for myself that I absolutely LOVE working with friends and family. I will do midnight showings for them if they see a home pop on the market and want to get over there before the rest of the world. I had one friend who was the engineer type and wanted to see about 50 homes in person. Yes, 50. And he wanted to see them all at 6:30 which is exactly when I finished my personal training. So I told him, I’ll do that for you, at 6:35 if you can understand and overlook the fact that I’ll be in gym clothes. He couldn’t care less about that, he was there for the houses so we saw a few every night and after a few weeks, he had made an educated choice that he felt good about. It was the perfect example of mixing friends with business and where a little understanding on each side made the dream work.
So now that we have that myth behind us, let’s talk about my favorite thing-money honey. I can practice Real Estate ANYWHERE in California because that’s where my broker’s license is hung. However, I can refer clients to my Realtor partners ANYWHERE in the USA and because I’m a Broker, not an agent, I can get paid for it.
I’m from the polar vortex that is Michigan and so I have many people that trust me there. When these people ask me to help them get started, I am more than happy they think of me as a Real Estate resource. I have numerous partners in Michigan and if they do not have a Realtor already in mind, then I match them up with the agent that I think will work best with them and knows their preferred area best. If they have an idea of who they’d like to use already-I MUST be the one to connect them directly with that person. THIS IS THE HARD PART to understand. There is a proper referral form that must be the first form of official contact on this particular deal. It doesn’t matter who the other agent is ( whether you know them or I know them ) but only that I send this form stating your objective.
After this form is done you continue on with this person as your Realtor with the optional added bonus of me being able to follow and help with your transaction. Again, you can pick the agent or I can give you my top picks and you can select the one you like the most. End up hating them after two weeks? No problem, let’s pick a new agent. Same process.
Why this is wonderful: The primary agent gets a wonderful new client, I get a referral fee and you get two realtors for the price of one.
But that’s not good enough anymore. I want to give you a referral fee too. I used to do a Nordstrom gift card for every referral but the laws have recently changed allowing Broker’s only to give a little more on these. And so I introduce you to the easiest money you’ll ever make.
My friends and family plan.
If the sale is outside of California and I am not the primary agent:
Say the Purchase Price is $500,000
The Realtor is getting 3% which is $15,000
Of that, the realtor is giving me 35% which is $5,250 per the standard Board of Real Estate agreement.
Of that, I’m giving you 10% which in this case is $525 as a gift. Just because you’re my friend or family and you thought of me as your Real Estate resource.
If the sale is in California and I am the primary agent:
Say the Purchase Price is $500,000
I am getting 3% which is $15,000
Of that, I can give you 10% which is $1,500 as a gift OR a credit at closing going towards covering your closing costs. Just because you’re my friend of family and I value you coming to me first.
In short, come to me first when you or someone you know is even thinking about starting the process of buying or selling a home and I’ll now be able to give you a portion of that back. Just remember, ANY state I want to be your real estate resource. And I’ll be happy to put my money where my mouth is because sharing is caring and what goes around comes around.
Until then, may all your business be on the friends and family plan,