The Problem With Agents: They’re Not Selfish Enough

by Sean Purcell

Real Estate Renaissance Man

Author website

I talk to a lot of real estate agents and if there is one universal problem I see, it’s this: you are not selfish enough – not nearly selfish enough.  I’ll explain that in a minute.  First, let me ask:  how many reading this took auto-shop in high school?  I’m guessing maybe half.  Of those that took auto-shop, how many actually work on their own cars?  Right.  You don’t take it so you can grow up and work on your car.  You take it so when your car breaks down you have a clue what might be wrong with it.  You want to know if the repair shop is taking care of you or just taking you for a ride.  The importance of wide-ranging knowledge is even greater for agents.  The real estate business is a difficult one in the best of times and it’s always time consuming.  It encompasses so many different areas, you may not need auto-shop (although I recommend it),  but you do need Mortgage-shop, Title-shop, Escrow-shop, Sign-shop, Web Site-shop, Appraisal-shop, Home Inspection-shop, Staging-shop and on and on.  Obviously you can’t be an expert in all these areas, but just like auto class, you should know enough to make sure you – and your clients – are being taken care of rather than just taken for a ride.  Beyond that the most important thing you can do is surround yourself with a team that excels in these areas.  Herein lies the problem for which I titled this post:  real estate agents are not nearly selfish enough… with their time.

I’m going to share one perspective on how big an impact this can have on your bottom line.  Last Wednesday I was involved with three different events affecting over $1.7 million of real estate transactions.  For the math challenged, that’s $51,000 in real estate commissions.  I’m writing this from a lender perspective because that’s what I am, but it’s all about the agents.

• Early on Wednesday we funded a VA purchase loan for a little over $700,000.   Not remarkable in and of itself;  what stands out is that this borrower and his loan had already been declined… twice.  Fortunately, the agent knew enough about VA loans to know this one was doable.  No different than auto-shop:  you don’t have to know how to fund a VA loan, you just have to know if it’s fundable.  This agent did, so he went looking for a VA expert and found Brian Brady and myself.   His client now owns their dream home and he’s cashing a $21,000 commission check – all because he knew enough to go find the right team.  Do you think his client was pleased?  “I have more business for you” pleased?  How about “I can’t wait to refer my friend to you” pleased?
• Later that same day we went to an appointment with a top producing agent.  She had a purchase client who was about to pull $100,000 from a qualified account and pay over $10,000 in penalties because that’s what the client’s lender told her to do.  This agent knew enough to know that didn’t sound right and she called us.  Again, no different than auto-shop:  you don’t have to know how to fund a loan from a financial planning stand point, you just have to know that such a thing exists.  How excited do you think the client was when this agent  called and said “her team” was going to save the client close to $10,000 in penalties?  “I’ll give you more business” excited?  “Here’s a referral” excited?
• As it turned out, we were late for the meeting I just mentioned.  We were late because early Wednesday afternoon the mortgage back securities (MBS) market reversed itself.  For the past few days we had been floating all of our clients and they were enjoying better rates and fees because of it.  But things changed rather suddenly on Wednesday.  Since Brian and I are both a couple of old traders, we watch the MBS market…  and enjoy it (insert “get a life” joke here).  There is often less that a 45 minute window between the MBS market reversing and the lenders freezing their lock desks for repricing.  We jumped on the phones, locked the loans and called the agents.  We saved those clients close to $3000 each in extra closing costs.  (Or, worse yet, they may have been forced to take a higher rate, costing them tens of thousands over the life of the loan.)  Either way, how happy do you think the clients will feel when their agents called them and say:  “My team is looking out for you.  We just saved you a few thousand dollars in extra closing costs?”  Will they be “Here’s more business” happy?  “May I give you a referral” happy?

Because these three events occurred so close together, it hit me what was really happening.  These transactions were getting done, money was being saved and commissions were being earned because the agents knew enough to surround themselves with people who added to their business.  They were, in other words:  SELFISH with their time.   It reminded of a description I once read of Lance Armstrong.  The biographer had said that when it comes to people trying to enter Armstrong’s inner circle (“the world of Lance,” I believe he called it), there were  no gray areas.  Either Armstrong saw you as someone who contributed to his goals with little or no distraction, or he just plain didn’t see you.  His time was much too valuable to waste with someone who was not adding to the equation. Black and white.  Here’s the thing to remember:  Lance Armstrong’s time is not any more valuable then yours or mine, he’s just more aware of it’s value than most of us.

As I said, I wrote this from a lender’s perspective because that’s what I do.  But it’s true with your title rep, your escrow agent, your attorney, your home inspector, your home warranty rep, your stager, your assistant, your coordinator and everyone else in your circle.  You absolutely must be incredibly selfish with your time.  Take a look at all the people who make up your “team.”  I mean really evaluate them.  Make sure they are contributing to your business with little or no distraction.  Make sure you’re not actually spending more time on transactions due to all their “help.”  If you don’t know enough, take a loan class or an escrow class… or an auto class.  As I wrote last week:  time is the most important (if not only) product you stock on your shelf.   It is your most precious asset and it is absolutely non-renewable.

By choice or by inertia:  you surround yourself with professional relationships.  Make sure those relationships enhance your profession.