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#367741 - 02/22/11 02:30 PM
"Referral" plan offered to me...opinions, please- thanks!
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Junior Member
Registered: 10/04/10
Posts: 3
Loc: Oro Valley, AZ
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Hi everyone...
I would really love some opinions to see if my thoughts are out of line. I was recently offered a chance to receive referrals from a long established agent in my area. This agent has a website that apparently brings in a fair amount of leads. When I was told the particulars of this agreement they were as follows...
1)50% referral fee (OUCH)
2)All leads contacted within 15 minutes ( I am very good about getting back to people-- almost always get back to clients within the hour, even if I am with clients I will text or pop off a quick email to let them know I will be in touch asap- but 15 minutes might be a stretch at certain times)
3) I must enter all leads into this agents contact mgmt system
4)All future deals that come from the lead I will have to pay 25% on (referral for life??)
5) All leads have not been qualified at ALL- that will be up to me. Am I incubating them for him???
We are meeting tomorrow to discuss this. While I don't want to seem ungrateful, it really seems as though I will be getting a VERY short end of the stick. I am flattered that I was approached, don't get me wrong (in case this is being read by the party in question, LOL) I am a newer agent and not a top agent, BUT I am not starving either, and have sold half of what I sold last year in the first 2 months of 2011. (Last year was my first year). Also-- not looking to be on a team with this agent...working on team with my spouse, and we have our own branding/marketing. I would like to know what others think about this plan--- am I far out to feel like this is a lead generation program and NOT a referral model from this agent? Also--- am I wrong to feel that this is not standard and excessive? OPINIONS AND EXPERIENCES PLEASE! Thanks!!!!!!!!!
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#367750 - 02/22/11 03:57 PM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: ThePropertyAces]
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Veteran Member
Registered: 01/19/06
Posts: 994
Loc: New Jersey
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Hi everyone...
I would really love some opinions to see if my thoughts are out of line. I was recently offered a chance to receive referrals from a long established agent in my area. This agent has a website that apparently brings in a fair amount of leads. When I was told the particulars of this agreement they were as follows...
1)50% referral fee (OUCH)
2)All leads contacted within 15 minutes ( I am very good about getting back to people-- almost always get back to clients within the hour, even if I am with clients I will text or pop off a quick email to let them know I will be in touch asap- but 15 minutes might be a stretch at certain times)
3) I must enter all leads into this agents contact mgmt system
4)All future deals that come from the lead I will have to pay 25% on (referral for life??)
5) All leads have not been qualified at ALL- that will be up to me. Am I incubating them for him???
We are meeting tomorrow to discuss this. While I don't want to seem ungrateful, it really seems as though I will be getting a VERY short end of the stick. I am flattered that I was approached, don't get me wrong (in case this is being read by the party in question, LOL) I am a newer agent and not a top agent, BUT I am not starving either, and have sold half of what I sold last year in the first 2 months of 2011. (Last year was my first year). Also-- not looking to be on a team with this agent...working on team with my spouse, and we have our own branding/marketing. I would like to know what others think about this plan--- am I far out to feel like this is a lead generation program and NOT a referral model from this agent? Also--- am I wrong to feel that this is not standard and excessive? OPINIONS AND EXPERIENCES PLEASE! Thanks!!!!!!!!! Absolutely, utterly, unconscionably ridiculous. Tell this agent to take a hike. Get your own business, the referral fee will be 0%.... for life... You don't need referrals, you need to prospect and get your own listings and buyers. Period. Don't pay anyone. Just get the business yourself.
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#367757 - 02/22/11 04:58 PM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: navarac]
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Major Contributor
Registered: 04/12/08
Posts: 4726
Loc: Vermont's North-East Kingdom
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We are meeting tomorrow to discuss this. What's the rush ? How long have you been thinking about it ? It should be a very short meeting anyway, as I concur with the others above . . . . like is he rushing you to make a decision? Regarding Referrals of any kind, it is always important that you make any contractual relationship "exclusive" with regard to any party being referred. If you ever get wind that your Referring Party has sent the same lead/referral to someone in addition to you, then all bets are off and the deal is "Null and Void". I've caught the "Relocation Specialists" of a few BIG NAME Franchises casting a big net in order to help guarantee a Fee by referring the same "name" to 7 or 8 different recipients . . . . any warm body who has a listing in the area that the "name" is contemplating. They need to refer EXCLUSIVELY, with: ALL Contact Information; and Buying Capacity; and Wants, Needs, and Desires in order to be considered Billable Referral.
_________________________
Dale C. Hittle of GOLDEN RULE PROPERTIES in Glover, Vermont
Where We're Always Striving To Put Together "THE FAIR DEAL"
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#367764 - 02/22/11 06:03 PM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: Vermont]
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Junior Member
Registered: 10/04/10
Posts: 3
Loc: Oro Valley, AZ
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The agent approached us a week and a half ago... sorry for the urgency to my post...should have asked for opinions earlier. I originally thought the offer was not good, but started to second guess it- but just wanted to hear what all the seasoned agents here thought. I REALLY appreciate the feedback- sounds like my original thinking was correct. Thanks!!
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#367785 - 02/22/11 10:46 PM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: Perky_REALTOR]
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Member
Registered: 02/13/11
Posts: 16
Loc: Texas
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[quote=Perky_REALTOR]
That said, I flat out refuse to pay more than 25%. I will decline referrals if they demand more than 25%.[/quote]
I took a referral a few years ago for 35% and it ended up being a $1.1M sale at 3% commish. My hat's off to you if you would turn that down.
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#367894 - 02/23/11 06:05 PM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: Kjmendy]
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Member
Registered: 02/08/11
Posts: 70
Loc: Long Beach, CA
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Agreeing with Perky and everyone else here, with those kinds of requirements (15 mins.) and eternal fees, not only should you get an hourly wage but a desk, chair, phone and coffee machine. I would'nt burn the bridge and you sound like you have enough penache' to graciously renegotiate. However, he sounds like he's looking for someone starving for business--not you.
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#367990 - 02/24/11 11:08 AM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: J_B_Agent]
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Mod Squad
Major Contributor
Registered: 11/27/06
Posts: 7685
Loc: PA
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That said, I flat out refuse to pay more than 25%. I will decline referrals if they demand more than 25%.
I took a referral a few years ago for 35% and it ended up being a $1.1M sale at 3% commish. My hat's off to you if you would turn that down. Well if I had a million dollar sale (or heck even a 300,000 deal) I would reconsider my stance. However, we're talking about under $100,000 listings here. The one that wanted a 35% referral ended up selling for $70,000. I did get the listing and he accepted a 25% referral. I turned the listing down TWICE - the agent wanted 35% and I said no way, thank you very much. Then he said he'd take the 25%. Then the SELLER said "I want you to cut your commission cause we don't pay that much here." I said "Thank you very much but my fee is my fee. I wish you well!" He called me back and wanted me to list it. I'm sorry but giving a 35% referral (and then cutting commission to boot?) on a listing like that is out of the question. Would I cut my fees or take a higher referral on a million dollar sale? I might.
Edited by Perky_REALTOR (02/24/11 11:11 AM)
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#368000 - 02/24/11 12:17 PM
Re: "Referral" plan offered to me...opinions, please- thanks!
[Re: Perky_REALTOR]
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Member
Registered: 02/13/11
Posts: 16
Loc: Texas
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[quote=Perky_REALTOR]
Well if I had a million dollar sale (or heck even a 300,000 deal) I would reconsider my stance. However, we're talking about under $100,000 listings here.[/quote]
That's different, and I agree I'd have a hard time taking a 70k seller for a 50% referral fee.
But the person who started the thread never said what the price range is, and some people are giving inflexible advice to "don't do it man!" without knowing the full story.
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Registered: 10/14/11
Posts: 54
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