WHEN DID "REFERRAL" BECOME A DIRTY WORD??

Lenn, 

Referral is not a dirty word!  I love the way Loreena commented, so much of what we are being compensated for in a referral is our knowledge and experience.  That's priceless!

All the best, Michelle

I love referrals.  They normally result with ready and willing buyers and highly motivated sellers.

Lenn:  I have to say, I'm in your camp on this one.  I send out my fair share of referrals and do get compensated for them. 

I can attest to that! 

Lenn.... I don't have a problem with referral fees, as long as it doesn't get added to the borrowers bottom numbers and makes it more pricey. You pointed out some excellent reasons to why someone should be compensated. My only concern is at whose expense and how much. I am just making a general statement in regards to all referrals and not directly tied into realtors.. just my opinion.  thanks

Lenn - I completely agree with you.  I also always expect to pay a referral fee.  It's just what we do.  Now how much can be another story...

Well stated Lenn.  I read your post right after adding someone on AR as an associate.  I like his writing style and thinking.  I would definitely work with him if I knew of anyone buying in his area. 

Referral fees make perfect sense to me and I don't hesitate in paying them.

Lenn, thanks for this post.  I read the post and could not disagree with a position more.  My business like your is Internet based.  I develop more leads than I can possibly handle, and so I refer out the leads.  Many persons are helped by this.  First of all buyers and sellers benefit when a good lead is handed out to a competentagent.  They either can finally sell their home or buy the home of their dreams. 

The next item is agents.  I have many agents that make a great living each year from leads I give them.  One cannot forget that real estate is a difficult business to survive in.  We have no benefits, hospitalization, retirement, unemployment benefits or disability entitlements.   20% to charity?  Why not 25%?  Why not 30%?  35%?  Why skim an extra 5-10% off the top for yourself?  How self serving.  Charity begins at home.  Referrals are as basic to real estate as ABC!  Most agents are more than happy to pay a referral fee for their hard work!  They appreciate the opportunity for a lead to be thrown in their laps that they did not have to generate by knocking doors, cold calling or by spending big money on a marketing campaign!   It puts food on the table, pays a doctor bill, pays for the car, puts gas in the tank, and lets us all live the Americandream!  Hope their business models survives.  I know mine will as long as there are referral fees!

Lenn, well put, I saw the post, my initial reaction was not to give it leggs, since you addressed it so eloquently we should ask Mr. Gramm to visit your post and have him read our comments.

Lenn, I pay out a lot in referral fees. Referrals probably make up 50% of my buisness. I gladly pay and I gladly receive.

Lenn, When I give referrals I call it phone money.  When I receive them I call it a super hot lead.   We give and receive 25% for referrals. It balances out all the other hours we don't get paid.

I almost missed this post and I happily receive referral fees and I gladly pay them after I have done some thorough research on the agents. I expect them to do the same job I would and in just as meticulous a manner!

Lenn, referrals are just another income stream from this business.  It's sad that some people don't take advantage of it.

Lenn - I agree with you.  I refer out a lot and am always open to take referrals as well.  If I don't know the area, I'd rather refer it to someone who does.  

My first referral I sent out took me more than an hour to find the perfect agent!  I do pay a referral fee and I would like referral fees in return.  I gladly paid a 40% referral for my first one I received on AR.  I received an ABUNDANCE of "back end" selling help from my referral partner.

I guess it just depends on how we look at a referral!

Lenn - I do not see an issue with an agent collecting a referral fee, so I have to agree with you here.

A good referral creates commerce. If you help create commerce you are entitled to compensation. 

Lenn-  I definitely think that referrals are a good thing.  I always get as much information as I can to pass along to the agent that I am referring to.  I think that it is important that I give the agent I am referring to not just a name and contact number, but anything else that I may know that will best help that agent assist the client.  I have received referrals that the agent literally has nothing other than a name and number.  I sometimes get a bit annoyed that for that I need to pay out, but then I remind myself that I may never have gotten that lead if not for that referral.  So in the end, any referral is worth a huge thank you to the sender!

Lenn-  I just linked to Justin's post that you mentioned here.  I do accept and pay referrals fees, but I also wouldn't have a problem referring a client to him, if he were the best suited for the job.  I think that he makes some valid points about full disclosure- IMHO, anyway.

Lenn - I consider it a finders fee for matching a buyer to an agent.  In the case of a buyer I am usually bringing a qualified buyer to the agent and not just a looky-loo.  Seller referrals are those who I have determined are ready to list NOW.  I believe in sending quality referrals to other agents - I think anybody would find value in that.  I feel I am entitled to put a price on my time and efforts.