There are Four
Steps in a real estate transaction that must occur before a deal is closed or
even if a client has the capacity for the transaction to close in the first
place. For the most part, there are no
exceptions. All sales
professionals at some point, when representing their client as a buyer’s
agent completes all four steps… there is no cheating… the larger the
transaction, obviously the more pronounced the steps are. While completing the
steps, it is always important to remember that these are completed in a professional
manner with the understanding that if a client has a wonderful total
experience with the professional they will remain a client and they
will send them more clients – the client is treated with courtesy and respect
throughout the process.
The four steps in
the process are:
- · Qualification
- · Rapport
- · Education/Information
- · Close
I am going to
break this down into 3 separate blog postings, I will cover Qualification in
this posting, Rapport in the next and Education/Close and close in the final.
It is important
to note that if we ignore any of the steps and/or try to skip on and/or do them
out of order we will likely get a backlash or jeopardize the transaction. We
might come across as pushy and manipulative - because we are force-feeding the process.
Qualifying buyers
is one of the most overlooked and ignored step in the real estate profession
today. This is a fundamental flaw Realtors
make (especially people new to the industry), assuming the buyer is already qualified
for a mortgage when they are not or possibly showing them properties when they
haven’t even listed their home for sale are just a few examples. Failing to qualify buyers will virtually guarantee a
horrible experience for the seller or a buyer and the professional will come across
as likely looking unprepared and unprofessional to the other real estate
professional on the other side of the fence.
A Realtor
will waste time, money and energy trying to sell a home to an unqualified
prospect. They waste time because they (the family) aren’t going to buy (they
want to buy but they can’t because they don’t qualify for financing). The Realtor
wastes money because their marketing budget is drained aiming at the wrong
target. They are also wasting money because their time could have been better
used to actually bring a qualified buyer on board – showing them properties
that they really qualify for (opportunity cost). If a client does not have a
full loan prequalification from a notable lender
(which a professional needs to verify) they should stop the process and get
them approved internally (if their organization provides this service), or farm
it out to a lender they work with. You are doing everyone a favor.
A qualified
client must have the time, need and want.
In most markets
across the United States everything is go, go, go… A client may very well have
the money, be qualified for the loan – but not have the time to engage in the
purchase or the transaction because they are too busy at work, with kids,
whatever… They are too busy to engage the real estate professional at practical
times. As professionals
we are extremely busy and our time is scarce and we certainty aren’t Burger
King (have it your way)! We do our best to accommodate our clients’ schedules –
but we have families and other clients to work with as well. If you called your attorney (or CPA or doctor)
in the middle of the day and said you wanted to see him in an hour and he said “sure come on down” what would your
thoughts be about that professional?
We would be concerned – very concerned.
The same holds true for us as real
estate professionals, if we are at our kid’s soccer game or attending
another important function or calling on another client, we are not going to
just ‘pick-up’ what we are doing, to meet the demands of a particular client
because they aren’t willing to allocate the necessary time to make the
transaction work. We are busy professionals
and our time is scarce.
The last part
deals with having the power… The old saying in real
estate is if someone wants to go look at a home in a snowstorm they are
really motivated to make it happen. To go out in a snowstorm to look at a home
says that you really have a pressing need (or they just really love the snow). This
is a polar opposite of a house-hunter driving around on a beautiful Sunday
afternoon and noticing an open
house, walking in, killing some time, checking their neighbors decorating
and then deciding they need to go home and add some plantation shutters and
remodel the den.
I am hard pressed
to think of any time that I worked a married couple that bought a home without
both husband and wife seeing the home… If a professional
attempts to have someone make any type of decision, big or small without their
spouse – they are losing a lot of credibility. The concept of properly
qualifying a prospect by making sure they have the money, time, need/want, and
power to buy from a professional is far-reaching, but is really simply boils
down to knowing “knowing our target
market” forwards, backwards, upside and down.
Greg Steinaker – BanCorp
Properties
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