Clients need to be able to trust you

By
Real Estate Broker/Owner with Respect Realty LLC 200311024

Client trust should be the first priority in your real estate business, because once it is lost, there isno getting it back. Everystep 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 knowthat 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 knowthat 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 toavoid 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 affectthat 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.

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Rainmaker
89,177
Kathy Carson
John Stewart Walker, Inc - Lynchburg, VA
Realtor, Lynchburg, VA, VA Homes - Lynchunberg,Bedford, Campbell

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

Mar 25, 2009 06:15 PM #3
Ambassador
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Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
Brokers - Oregon / SW Washington Real Estate

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!

Mar 25, 2009 09:03 PM #4
Rainmaker
453,249
Allison Stewart
St.Cloud Homes - Saint Cloud, FL
St. Cloud Fl Realtor, Osceola County Real Estate 407-616-9904

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.

Mar 25, 2009 10:14 PM #5
Rainer
332,992
Chip Jefferson
Gibbs Realty and Auction Company - Columbia, SC

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.

Mar 25, 2009 11:09 PM #6
Rainmaker
54,106
Tom Larsen
The Larsen Protection Team - Williamsville, NY
We Shop, You Save!

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

Mar 25, 2009 11:15 PM #7
Rainmaker
550,319
Barb Szabo, CRS
RE/MAX Trinity Brecksville Ohio - Cleveland, OH
E-pro Realtor, Cleveland Ohio Homes

I second Tom's comment above. And once that door is open a little bit, it just gets easier and easier.

Mar 25, 2009 11:18 PM #8
Rainmaker
1,016,986
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

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.

Mar 26, 2009 12:11 AM #9
Rainmaker
94,224
Sharon Harris
Keller Williams Keystone Realty - Hanover, PA
Realtor

You are right. Do the right thing even when no one is looking. you will never fail

Mar 26, 2009 12:27 AM #10
Rainmaker
722,609
Connie Lou Barnett
Real Living/Home Realty - Owensboro, KY
GRI,CRS,CRB,SRMM,ARA,PRS,SFR,QSC

Honesty and integrity is always the best policy.  Great post Todd and thanks for sharing your thoughts.

Mar 26, 2009 12:39 AM #11
Rainmaker
541,216
Shirley Parks
Sands Realty 210-414-0966 - San Antonio, TX
Broker, 210-414-0966, San Antonio TX Real Estate

Always do the right thing.  It isn't worth it to do anything else. 

Mar 26, 2009 02:01 AM #12
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Respect Realty LLC - Milwaukie, OR
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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?

Mar 26, 2009 02:06 AM #13
Ambassador
893,938
Larry Bettag
Larry Bettag - Cherry Creek Mortgage - Saint Charles, IL
Regional Vice-President

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.

 

Mar 26, 2009 02:54 AM #14
Rainmaker
1,852,056
Tom Braatz Waukesha County Real Estate 262-377-1459
Coldwell Banker - Oconomowoc, WI
Waukesha County Realtor Real Estate agent. SOLD!

Todd

Those doors are doors that can come down; best to never open them

Sincerely

Tom

Mar 26, 2009 05:43 AM #15
Ambassador
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Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
Brokers - Oregon / SW Washington Real Estate

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.

Mar 26, 2009 08:52 AM #16
Ambassador
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Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
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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.

Mar 26, 2009 10:19 AM #17
Rainmaker
384,130
Mark Hall
Elite Realty NW - Keller Williams, Vancouver Washington - Vancouver, WA
Homes for Sale Vancouver Washington

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!

Mar 26, 2009 03:23 PM #18
Ambassador
921,339
Steve Shatsky
Dallas, TX

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.

Mar 26, 2009 03:39 PM #19
Ambassador
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Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
Brokers - Oregon / SW Washington Real Estate

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.

Mar 26, 2009 06:42 PM #20
Rainmaker
456,522
Roberta LaRocca
Simply Vegas Real Estate - Las Vegas, NV
REALTOR®, Broker, Salesperson, Property Management

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.

Mar 26, 2009 09:17 PM #21
Ambassador
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Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
Brokers - Oregon / SW Washington Real Estate

Roberta - No it doesn't!

Mar 26, 2009 09:49 PM #22
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