I got a call yesterday from a gentleman saying he saw my listing and wanted to put a contract on it. I'm saying, Great! Do you have an approval letter, or are you paying cash? He responds that it'll be cash. Great! Can I get a letter from your bank showing proof of funds. He says that's not a problem.
He tells me he's in Phoenix right now, but will be back in Dallas in 10 days at which time he then wants to look at the house before moving forward. I explain to him that there has been a lot of activity on the house and I can't take it off the market to wait 10 days for him to come into town, but that I'll call him if I receive another offer before he gets to town. He appreciates that.
Then, he talks further about how he's taking classes to get his real estate license. I'm thinking, the smart thing would be to wait until you have the license before buying so you can collect the commission, but didn't say that. He also mentioned it had been hard taking all the classes because he wasn't sure about quitting his job. I then spark up and say, Hey! I've got an idea. When you get your license, if you want to continue to work full time, you can pass off any potential buyers and sellers to me and I can pay you a referral fee!
His reply was, "Yes, this is a referral deal." I say, excuse me? He says he wants a referral fee for the purchase because it's his friend wanting to buy the house. OHHH, you're not the buyer?? No, he's calling for his friend. OK, in the state of Texas, I cannot pay you a referral fee without a valid, active license. He asked if I could pay it afterwards. I asked what they were teaching in real estate school these days. WOW!
Anyway, I explained how it was illegal. I also told him I would talk with the seller about potentially buying the title policy for the buyer as that would help the buyer with costs. He sounded excited about that and he said that was nice of me to offer to help the buyer like that. (Sellers paying for the title policy is almost customary in my area, but he doesn't know that).
We'll see if I can get this house under contract... 9 days left before they get back in town. Oh, and before we hung up, he asked if I could email him any other homes in the area under $300k. I told him I needed to talk directly with the buyers before moving forward. Everyone is always looking for their piece of the pie even if they don't deserve it...
Nice catch Donna. Have you called him back? This sounds almost like a "checker" to me ...
As a real estate attorney told me during my classes, "it isn't you newbies that I'm worried about -- you're scared to death of making a mistake -- its those old farts that have forgotten all this stuff that has me worried."
So it doesn't make any sense that a "newbie" would be trying that...
Easiest conversation in the world ... "wait, you're not licensed? Next!" Oops, I'm lapsing into RT-speak.
Get your license, then we'll talk. Alternatively, I have some coupons for a free ice cream cone at Dairy Queen that I'd be happy to share with you.
You handled it well.
I really don't see why you can't pay referral fees to someone who has an active license; it doesn't make sense. It's your commission, you should be able to do with it what you choose. If the state of Texas (or California) trusts you to handle millions of dollars worth of real estae transactions, why can't they trust you to manage the transaction (with your license on the line) and pay whomever you choose for marketing costs.
I know, I know that it's illegal. I'm not suggesting you beak the law. I'm suggesting that the law is stupid.
I agree with Brian. When you earn the commission, you should be able to do with it what you want.
I agree with Brian Brady, some of the rules Real Estate Councils and Boards have are about monopoly. How someone gets a refferal or a sale is up to them. As an Investor the term 'Bird Dog' gets thrown around. I have bought multiple homes through one guy who refers all his friends. I gave him what he wanted when he sold his house to me and he tells others about how great it was. I reward him for it.
What is a non-licensed advocate of who you are and what you do worth to you. Why would someone use you or refer you if you provide the same excellent quality as another professional? All things being equal I send them to the one who gives me the shopping spree or cold hard cash.
I guarantee if I refer anyone to anybody be it my realtor, broker, lawyer, or any other power team member I'm going to make sure they know my help. My lawyer had to hired extra staff with all the referrals we've given him. And I get some nice freebees. My back is never itchy cause the professionals I work with don't have an itchy back where I'm concerned.
Reciprocity is in effect with everything. You help me, I help you and its the same as I help you, you reward me and You help me, I reward you.
The 'realtors' law isn't just stupid its rediculious and I'd say there are fewer leads given to realtors cause its of no benefit to someone to pass on the fact that aunt Flo and uncle Jim are thinking of selling and getting a smaller place closer to their retired friends and on it goes.
Give your word of mouth some fuel.