Help Your Agent Make You Rich
Once you find an agent who seems like he or she talks your language! And of course, demonstrates some honest action like jumping right in and finding you a few properties that seem to fit your “looking for” instructions — You’ll be off to a running start.
One thing to remember here - Both you and your agent are new to each other! Don’t make the agent do all the work. You should help every way you can, especially in the “getting acquainted” mode. For example: If the agent is showing you properties in fair condition and you have told him you want junkers. Reiterate your instructions so you get what you want. By helping your agent who is trying to help you. — You’ll end up the big winner.
The benefits you’ll receive by taking the time to develop this relationship will be worth big bucks to you in the long term! Here are some of the most important ones.
1. Your agent has immediate “pipe-line” knowledge about when a bargain property is listed for sale - Either as a member of the multiple listing service or by networking through his associates and contacts. You’ll get the information quickly so you can write an offer fast if the property is what you’re looking for. Being first or near first is important!
2. A good agent will do “weeding-out” for you automatically once he or she becomes accustomed to what you really want. My agent, Fred, always brings me everything I need for making an educated evaluation on each deal. The information provided is normally a property profile, copies of existing promissory notes and either a filled out INCOME PROPERTY Analysis FORM (the kind in my fixer house book), at least the necessary data to fill one out. This is valuable “time saving” work for an investor - Yet it’s needed before any intelligent buying decision can be made. Obviously, it puts Fred closer to a commission if a purchase should result.
3. My agent provides a middleman “buffer” between the buyer and seller. This is a valuable service to me or any real estate investor who owns multiple properties already. “Mom and Pop” real estate owners (the kind I buy most properties from) often feel intimidated negotiating with me one-on-one. They seem to feel that because I own so many properties and am successful. They’ll automatically end of on the short end of the stick! It’s a perception that’s hard to eliminate regardless of whether it’s true or not. Fred can generally diffuse (this problem for me in his capacity as a neutral third party. Sellers often feel that a licensed person will be more sensitive to their needs, as opposed to direct, face-to-face negotiating with a “ring-savvy” buyer.
4. A good agent will never let the commission block a sale. The good ones are creative! Often they’ll take a fraction of what they have coming in order to close the sale. They’ll let you pay the balance later on, perhaps in monthly payments. My first agent, Merv, would allow me to pay him 50% of his commission at closing and for the balance he agreed to promissory notes, anywhere from $50 to $250 per month, depending on my projected cash flow. At one point I was paying monthly commissions of $1250 to Merv. In addition to helping me, Merv was very happy to have the steady monthly income, plus 08% interest.
5. A good agent can put you in contact with moneylenders, both private “hard money” guys and institutional lenders with programs that fit what you’re doing. Lenders shop real estate offices looking for qualified buyers among their clients. This is a valuable benefit to investors who are always in need of funds for upgrading and acquisitions. Naturally you and your project must qualify in order to take advantage here. Nonetheless, money is always the ammunition that keeps investors in the hunt.
As you might guess - The benefits must flow both ways between the agent and investor here’s what you shouldn’t do if you want to develop a profitable relationship!
A. Don’t chippy around! Use your agent for all your transactions unless you have special agreements or exceptions agreed upon. Loyalty will move mountains.
B. Don’t try to squeeze the commissions. If you are like me, that is, you negotiate commissions, do it before the agent goes to work! Not after the deal is written up and in escrow.
C. Don’t send agents on “wild goose” chases! The veterans will dump you if you try. But don’t even do it to the inexperienced dummies. Soon they’ll catch on and will have nothing more to do with you. I’ve heard “so-called” real estate lecturers tell novices to instruct their agents to draft up and present “low-ball” shotgun offers to purchase properties from the multiple listing book. Ask any respectable agent what he thinks of that advice! Take it from me; don’t waste your agent’s time with such nonsense.
D. Don’t make a ton of offers without ever closing anything. No agent can survive without “paydays” same as you. Take better aim so you’ll hit the target - Close the deals.
E. When other real estate agents call you direct - Always refer them to your agent. Also, some sellers will insist on dealing direct. They don’t want to involve an agent! That’s fine, but tell your own agent about the exception. Sometimes I pay Fred a small fee $500-1000 to help me do the legwork in the background. If you take good care of your agent, you will benefit the most in the long run, believe me!
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