Client trust should be the
first priority in your real estate business, because once it is lost,
there is
no getting it back. Every
step of the way the consumer is judging you and your
actions, but they can’t see what you do behind closed doors.
With
business being slow for so many in this business, I’ve been
getting more
and more calls requesting a partnership
of sorts with mortgage brokers,
insurance agents, heck even warranty companies.
But, how do our clients
know
that we are on the up and up with our referrals of these companies? Well,
one
form of protection is RESPA. (Real Estate Settlement
Procedures Act) This act was put in place so that the consumer would be
shown
on the HUD statement all compensation paid and they could then know
that a
referral was based on legit reasons and not a kick back of sorts.
The
problem is, when times are thin, some like to blur this line and try to
avoid this law by saying, “Oh, no one needs to
know”.
I’ve been getting more
and more calls from warranty companies offering me a kickback if I use
their
services. Mortgage brokers offering free services to use them, but all
these
are RESPA violations no matter how small they seem.
How is the consumer to
really know that we are really doing everything we do
with their best interest in mind?
Well, to tell you the truth, the consumer has
to have a little faith, but when that faith is broken, it
doesn’t just affect
that agent, it affects us all as an industry.
I
had an agent tell me yesterday of a mortgage broker offering to pay for
her
website and her flyers if she used his services, as long as he can
advertise on
both. I advised her that this
is a RESPA violation and she asked, “How would
anyone know?” I said, “YOU WOULD and that should be
a big enough reason not to.”
By
doing things like this, even if your clients don’t find out,
you are willing
to sell out your fiduciary responsibility to them for your own
financial gain.
You have a financial responsibility to your clients and the only
question that
should ever enter in to your mind when working for your clients is,
“Is the
best thing for my client?”
If you ever answer anything but “YES” than you need
to give them another choice.
Remember it is all about trust, and once that trust is gone, so is your business.
Todd Clark - broker
Kastings & Associates
Phone: (503)524-9494
Fax: (503)622-8739
© 2009 Todd Clark - Clients need to be able to trust you
Todd Clark and the Friendly Home Team
Knipe Realty
Todd@IFoundYourNewHome.com
Phone: (503)524-9494
Fax: (503)746-9573
I am a licensed Realtor who specializes in Washington County, Oregon and also work in both Clackamas and Multnomah Counties including the cities of Aloha, Beaverton, Canby, Clackamas, Gladstone, Gresham, Happy Valley, Hillsboro, Milwaukie, Oregon City, Sherwood and Tigard. All information contained in these posts are copyrighted and cannot be used without prior written approval authorization from the author me Todd Clark. If you are looking for an outstanding agent please give me a call I would love to help you with all your real estate needs.
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Oh Todd! Your parents sure raised a fine son! I loved your advice to your friend, "How would anyone know?" I said, "YOU WOULD and that should be a big enough reason not to."
It's late. Time to go to sleeeeeep. Hint, hint.
Marlene
I appreciate when people do the right thing. It shows a great character to do the right thing even when you don't have to.
Todd - right on! I recommend the people that I have worked with that work for my clients! They give great service and I can trust them. No kickbacks just the knowledge that I can trust them to do their job and make mine a little easier. Trust enough said - you have to earn it and we have to earn it from our clients - and I expect it from everyone!
Thanks for a great post!
Kathy
Marlene - Thanks, I'll pass that on to my parents. I wish I could take your advice on the sleeping thing, it isn't for the lack of trying.
Cameron - We all know those agents that don't though, that is why I'm taking on a training position with my new company to try to teach ethics and hard work can pay off.
Kathy - My referrals have to show they deserve it before I ever recommend someone. Even if I haven't worked with someone before, I have recommended them based on clients referrals. If my clients trust them, than I will give them a shot!
TODD
The simple solution is to DISCLOSE the nature of the relationship. It is OK to partner as long as all parties to the transaction are aware a relationship exists and agree to it.
I think you are right, there are many people trying to cut corners giving ALL professionals a bad reputation in the process.
Well said and done. I know when I lay my head down whether I have a clear conscious. I review my associated actions as they speak louder than a fee.
It is also about ethics and being an honest, ethical person. Once you cheat a little bit, the door is cracked open.
Tom Larsen
www.larseninsurance.com
I second Tom's comment above. And once that door is open a little bit, it just gets easier and easier.
Hi Todd giving kick backs is certainly a respa violation but I am not so sure that a mortgage broker paying for advertising space on an agents website or marketing brochures is a violation.
You are right. Do the right thing even when no one is looking. you will never fail
Honesty and integrity is always the best policy. Great post Todd and thanks for sharing your thoughts.
Always do the right thing. It isn't worth it to do anything else.
Allison - Not always OK to partner. If the mortgage broker is paying for everything completely it is a RESPA violation.
Laura - EXACTLY!
Tom - I have a closed door policy (LOL)
Barb - And we see it over and over again don't we?
What's the rule????? Know me, like me, trust me? That's 101 of sales. You never get to the trust without them liking and knowing. But ultimately no trust, then #1 and 2 go away. Cool post! You never get hurt by the truth.
Todd
Those doors are doors that can come down; best to never open them
Sincerely
Tom
Bill - If they are paying for it completely it is. If they are splitting the cost it isn't. Fine line, but there is one!
Sharon - Exactly, but some people just don't understand that concept.
Connie - My mom and dad taught me right I guess. Now if I can only teach others what they taught me.
Shirley - I wish others thought the same way we do. Short term gain, doesn't mean long term success.
Larry - I wish more agents and mortgage brokers played by the rules, but we will always have those that don't.
Tom - They have theirs off the hinges and laying against the wall.
Todd,
Once again you are right on the mark. How can an agent put his clients needs before his own if he is on the "payrole" of the companies whose services he is recommending?
When choosing an agent, character DOES matter!
Hi Todd... Trust is the foundation that ANY solid relationship is built on. It is critical to any successful transaction and should be cultivated and protected at every step. I always have believed that treating clients the way I would choose to be treated under the same circumstances goes a long way to establishing and earning their trust.
Mark - Yes it does, by the way, we need to talk next week as I have some big changes coming to my career and I want to talk to you about one of them.
Steve - I amazed at how many people don't think this is wrong taking money in trade for recomending them. I know we do it as real estate agents, but to be honest prior to Activerain, I told my clients I didn't know these people. Thanks to Activerain I can tell my clients that I've known these agents I'm referring them to for years in some cases and competely trust them.
Todd, in any business you only have 3 things to work with... knowledge, honesty, and integrity. Going after an unethical fast buck wipes out the last 2 of them, and makes the 1st questionable. That doesn't leave you with much to work with.
Roberta - No it doesn't!