When business referrals don’t return the favor

by 01 Nov 2016

I gave a lead to a real estate agent I am trying to get some business from. He closed the deal, but never sent me any business. He is friendly on the phone, but says he does not have anything for me. I can't understand what I did wrong here. Any ideas?

--Todd from New Mexico

You raise a very interesting question. While there is no way that I can possibly assess your situation without more detailed information, I can tell you this very situation happens again and again in our industry. As a matter of fact, I have had loan officers tell me that they have had agents take their referrals and send them to other lenders, claiming they had better rates. Did you do something wrong in your situation? Probably. What did you do wrong? I can't answer specifically. But I can go through the range of possibilities.

First, it is understood that a lead for a real estate agent is a precious commodity and you must get the most value possible from these leads. As a matter of fact, it should be a major objective of your business to produce referrals for all of your referral sources, not only real estate agents. This is a topic I will cover in the future. What type of value? There are two ways we can receive value from these referrals. One is to reward agents who are referring business to you on a regular basis. The other is to solidify a new relationship, which it sounds like what you were trying to accomplish with your referral.

Though we must also make the point that sending a referral to an existing agent referral source can produce new business as well. For example, perhaps that agent can introduce you to another agent or another referral source. Or perhaps you can refer others to one lead, such as an insurance agent or financial planner. Thus, do not think that these two objectives are mutually exclusive. Next week we will return to the issue of trying to use a referral to garner business from a new agent relationship.

--Dave Hershman

Dave Hershman has been the leading author and a top speaker for the industry for decades with six books authored and hundreds of articles published. His website is www.originationpro.com. If you have a reaction to this commentary or another question you would like answered in this column? Email Dave directly at [email protected].