Real estate agents are an integral part of the housing market. In fact, they play a major role in facilitating deals and helping their real estate clients make the most financially responsible choices. While most people are familiar with the basic duties of real estate agents, few seem to know what a real estate referral agent does. So who exactly are these agents? Is making money as a real estate referral agent possible? And what are some of the steps that you can take in order to become a successful real estate referral agent? In this article, we will outline a simple guide on how to succeed as a real estate referral agent.
What Is a Real Estate Referral Agent?
As the name suggests, a real estate referral agent is an agent who refers clients to other agents instead of working with them directly. These professionals are compensated with a real estate referral agent fee after the transaction is concluded. There are several factors that make the real estate referral business such an essential part of the industry. In fact, working with a real estate referral agent is ideal for clients and agents alike. The former benefits by being referred to an agent that can accommodate all their needs and provide the personalized guidance that they need. As for the latter, it allows them to work with a trusted professional who is capable of referring real estate clients on a regular basis.
Here are the main real estate referral agent duties:
- Being able to generate high-quality real estate leads.
- Building an extensive network that covers several real estate markets and various types of investment properties.
- Having a complete understanding of the different types of real estate agents.
After covering what a real estate referral agent does, let’s delve into the steps that you should take in order to become one.
The Steps to Becoming a Real Estate Referral Agent
Like any other type of commission-based work, there are no limits to how much you can make as a real estate referral agent. As long as you master the process of generating and qualifying real estate leads, you will always be able to command a hefty real estate referral fee. In any event, here is how you can become a real estate referral agent.
1- Get a real estate license
The first step of becoming a real estate referral agent is obtaining a license. The requirements for getting one differ greatly from one jurisdiction to the other so it is important that you check local laws before initiating the process. Having said that, the steps outlined below are applicable in every state.
- Sign up for a pre-licensing course: While there are a plethora of online resources that can help you develop a baseline understanding of the real estate business, it is still highly advisable that you take classes at a pre-licensing school.
- Pass the state exam: As we mentioned above, the real estate license test will vary depending on what state you are in. But generally speaking, it consists of 80 to 100 multiple choice questions that cover every aspect of real estate.
- File a license application: After passing the test, all you will have to do is file an application and pay the required fees. This includes the application fee as well as the cost of a background check.
2- Find a brokerage in your area
The next step of becoming a real estate referral agent is joining a real estate brokerage. In fact, being affiliated with a brokerage is a requirement for every agent who is looking to earn a fee or commission. The broker’s main role is supervising your work and ensuring that you are in compliance with local laws. As you would expect, there are several types of brokerages to choose from. Below is a brief breakdown of the main ones that you need to know about.
- Boutique brokerages: Due to the personalized training that they provide, these brokerages are ideal for novice real estate agents.
- National franchises: These are the established names in the industry. Examples of national franchises include Keller Williams and Coldwell Banker.
- Virtual brokerages: Given the ongoing Coronavirus pandemic, demand for this type of brokerage is likely to skyrocket. Thanks to the low overhead of these firms, a real estate referral agent can get a generous fee split.
3- Start generating real estate leads
Real estate lead generation is a critical task for a real estate referral agent. After all, the only way to ensure reliable income in the referral business is to develop a consistent stream of leads. There is a wide range of strategies that you can implement when it comes to generating leads. First, start with your own network and gauge the level of interest within your close circle. After that, you can widen the scope of your approach by exploring other strategies like cold calling and online marketing.
4- Qualify your leads
When it comes to real estate leads, the generation process is only half of the equation. In fact, the qualification is what allows you to assess whether or not the lead is a prospect. It is important to remember that leads should be seen as potential prospects, it is only after going through the qualification process that you can categorize them as actual prospects.
Lead qualification can be a lengthy and tedious process if you don’t use the right tools. Fortunately, you can find such a tool right here on Mashvisor! Mashboard allows you to automate lead qualification and provides you with all the essential data about each potential prospect. This includes everything from budget to financing. Furthermore, Mashboard features a lead likelihood algorithm that takes a myriad of predictive analytics into consideration when determining how likely a lead is to purchase.
5- Start making referrals
After picking a list of prospects, the next step is making the referrals. In order to do this, fill out a form that outlines the terms of the real estate referral agent agreement and make sure to include all the relevant information about you as well as the client. You can either submit this form to your broker or send it to a real estate agent in your network.
The Bottom Line
Becoming a real estate referral agent is an option worth considering for anyone who wants to get into the real estate business but doesn’t want to deal with the hassles of negotiating deals and finalizing contracts. As far as real estate careers go, this is about as convenient a job as anyone could hope for.