In sales the best type of lead is a referral no matter what product you are selling. Referrals usually come in hot and ready to go with trust already built in from the referral source sending the client to you. As real estate professionals we are always being coached on how to generate referrals and why to generate referrals, but most people forget to learn when to look for referrals. Once you understand the concepts of when to ask your clients for referrals and why that is the perfect time you will gain more referrals than ever.
When working any deal, no matter what sector of real estate you are in we have small milestones that all add up to the biggest milestone which is closing. For mortgage professionals just to name a few milestones we have the pre-approval, the appraisal, and the commitment letter. For real estate agents some milestones we have are the offer acceptance, the successful negotiation of a home inspection, the appraisal, the commitment letter, and so many more. When we hit each of these milestones it is not the perfect time to mention that you accept referrals and would love to help someone else, they know. One key concept to remember here is often the clients may not know you are looking for more business, so you need to let them know.
The most common time people ask for referrals that in my opinion is the worst time to ask is at or after the time where the loan or deal closes. I am not saying you should not continue to ask then but for some people this is the only time that they ask for the referral. Asking at the closing table the risk is that number one anything asked only once usually is forgotten and number two but most importantly when the client hits that end goal, they no longer need you and are now busy with their new home or next deal. If you keep that simple concept in mind you will realize how much more powerful it is to bring up referrals throughout the entire process.
Whether it be the mortgage professional trying to get an agent to send more deals over or an agent trying to get a client to tell their friends and family about them the rules are the same. For the mortgage professional knowing that as soon as the agent closes that deal with you, they are on to the next deal and likely in front of other mortgage pros is a key concept to remember. While you are engaged with that agent instead of just calling the client to tell them the good news reach out to the agent as well and let them know as the deal processes. While you have them on the phone instead of just jumping right to the point and asking for the referral take a moment to drop some knowledge about a new program or regulation coming up that could help their business then ask if any other clients need help. When you do this the agent will know you know your stuff and be more likely to tell future clients about your products and services. Also keep in mind sending referrals the other direction is a great way to solidify the relationship since so many mortgage pros ask but do not reciprocate.
For the real estate agent understanding that your client is either moving somewhere else when they sell and will be busy or knowing that a first time home buyer is about to become a homeowner and be overwhelmed with new task will help you understand why ask during these milestones. Often agents only ask at the closing or thereafter with the fear that the job is not done so they can not ask yet. This is still another great time to bring ask but it should not be your only time to bring it up. The milestones that happen throughout the deal are just as exciting to the client as the finished product. The biggest key takeaway is to ask for referrals and not to just sit back and think your work speaks for itself and that people will send referrals without you even asking. If they do that is great and you are lucky but asking at these key times is going to drastically increase your referral numbers. For more great real estate information make sure to check out the podcast and join the group “Real Facts on Real Estate”.