 President's
Corner
I'd like to make a few
observations about how NOT to do
business. WANNA
LOSE BUSINESS? Follow these three easy steps, which are sure to help your
competitors prosper and promote your downfall.
Don’t Do What You Promise. My post office is a daily reminder of this
principle. When we moved a few years ago we expected our change of address cards
to be delivered. They weren’t. And recently, the registration stickers for our
car were returned to the state, never reaching us. Then a couple of months ago
my state licensing exam for continuing education and renewal never made it to
me. Luckily they have a grace period. Mind you, I have nothing against the post
office, my dad was a letter carrier for 35 years and I know how much pressure
they are under every day to perform. Overnight carriers have prospered thanks
to the fate of our mail being as mysterious as those socks that somehow get lost
in our laundry. As
it pertains to the note business, don’t promise a note holder something that you
know you can’t deliver. A price that is unrealistic, funding of a note in a
week, documentation issues that you know can’t be worked around or even setting
up the seller’s expectations for more than you know you can deliver.
Don’t Show Up on Time. I learned this one the hard way more than 15 years
ago when
I had a note holder that was going out of the country and needed to speak to me
before he left. Being a chronic multi-tasker, I always sought to squeeze in one
more thing, resulting in calling people back later than I had promised and
getting back to people later than expected. One such day I called this
particular note holder back the next day instead of when we had agreed and he
had informed me, “I already signed an agreement with someone else yesterday.”
To this day I do my best to never let that happen again. Such lateness can kill
a note business. Even little things like getting back to the note holder the
next day to give them a price or calling them when you said you would call them
even if you don’t have what you were waiting for (a credit check, an appraisal,
an answer, etc).
Let
People Know How Busy You Are.
I can’t keep
count of the many times I had to find another investor, get a new price, switch
appraisers or title companies because they didn’t return a phone call or email.
Each time, someone else prospered by replying promptly. The 24 hour standard
for returning a call has been usurped by instant mail and
communicate-from-anywhere technology, making those who respond quickly the
winners. However, there is still a place for respectfulness, courtesy,
professionalism and ethics to balance your note business so that you can still
set business hours, take a vacation and have family time.
Here’s my point: Keep your
promises as best you can, be on
time and respond as quickly as
you are able, and you will
prosper – not your competitors.
Remember, Success Demands
Action! Keep on marketing, it’s
going to work! TWITA!
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Question of
the Week
Q
- Hi Jeff,
I have a question
regarding working the note business with a realtor. Some states require a
license (not mine) and I read an article that stated as far as licensing you can
work with a licensed realtor and not obtain a license yourself I would like to
work with a realtor but not split my entire fee.
Can this be accomplished when working with a realtor? How do you do this as far
as commission, marketing, and transactional requirements that a realtor may have
to follow. Any advice?
~
Tom
A – Hi
Tom!
Thanks for the email! It really depends on how exactly you are
working with the realtors. The way that I talk about working with realtors is
that you talk to the realtor and the seller of the property ONLY. You NEVER talk
to the buyer (we don't want them thinking we are giving them a loan because we
are not). You give suggestions to the realtor/seller of how they can best
structure the sale of the property and the note terms to carry back the most
valuable note possible so after they sell the property they can sell the note
for the best price possible.
The realtor makes their commission when they sell the property that
YOU helped them to sell with seller financing. You as the note broker make your
money when the seller comes to you to sell the note and you broker the note in
the future. No commission splits or anything like that. If the realtor mentions
it ask them how much of their commission they will give you for helping them
sell the house. They will say none. :)
If you are in CA you must have a RE Broker's license to do notes at
all. Not sure if this is how you were planning on working with realtors but I hope
this helps! TWITA! ~ Jeff
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