Why Are So Many Agents Clueless About How to Send a Referral?

In the course of receiving and sending real estate referrals, I've seen a lot of agent behavior which suggests that a pretty large percentage of agents have had little or no training about how to send a referral that results in a positive experience for the clients they are referring.

And I've also come to the conclusion that if the sending agent isn't willing to at least interview a handful of agents in the state and city (or town) where the referral is being sent, that sending agent isn't doing anything to earn a referral fee.

Your client trusts you to assist them when they are moving out of state.  They want you to provide the benefit of your industry knowledge and experience to help them find a great agent.

It seems pretty lazy when an agent sending a referral to another state can't even be bothered to pick up the phone and interview a few agents.  Some referring agents do little or no research.  They just sort of throw the ball up in the air and whoever calls first is the one who gets the referral.  How does that serve your clients?  Why should you be compensated for sending a "jump ball" referral, without lifting a finger to learn something beforehand about who might be accepting that referral?

I'm not a big fan of the ActiveRain "Referral Exchange" for the same reasons as those stated above.  The Exchange concept is that you (1) "post details about your client's needs, (2) wait for someone on AR to respond and, (3) then you decide after an agent has responded if you are going to actually send the referral to that agent who has made the effort to respond promptly.

Is the first agent to respond necessarily the best agent to handle the referral?  Responding promptly shows initiative and it demonstrates that the agent is eager to assist.  But choosing an agent to receive a referral solely on the basis of who is the most hungry and the most eager probably isn't the best way to find a great agent.

I've contacted four or five "Rainers" who sent referrals to my area, with no positive results.  One agent complimented me on how quickly I contacted him, but then he admitted that he felt guilty about using the Exchange instead of sending the referral an old buddy of his, so that referral quickly evaporated.  Two other referring agents never even had the courtesy to message or call back to say they'd decided on someone else.

I've also received referral alerts sent to me in the northernmost part of Minnesota, over four hours away from the Twin Cities.  I guess these referrals get shotgunned all over the state, which seems like a poor way to find a receiving agent.  A referral network that sends referrals to out-of-area agents doesn't do much to serve the consumer.

[The fine print on the ActiveRain Referral Exchange page reads "The referral exchange is provided to ActiveRain members as a free service at this time. At a later date the service will include a flat monthly subscription fee".  Based on the negative experiences and lack of results I've encountered with this service, I'd say subscribing to it would probably be a waste of money.]

The Council of Residential Specialists does an excellent job in its CRS Designation courses when it comes to training agents about best practices for sending and receiving referrals.  CRS also has its own Referral Agreement, which many brokerages do not offer.  And CRS offers a superb agent search page which allows you to search agents by specialty (Residential Sales, New Home Sales, Resort Property, etc.) and by other criteria (such as languages spoken by that agent). 

• If you want to send a referral, whether it is to someone in the CRS network, or to an ActiveRain member, don't be lazy.  Do something meaningful to help your clients find a great agent. Take a little time to research who you are sending that referral to.  Do a little homework about potential receiving agents.  Read their bio, learn their specialty areas of practice and do what you can to acquaint yourself with what they do and how they do it.
• Don't shotgun a referral out to a large number of agents. Doing so just sends the message that you are too lazy or incompetent to make some inquiries on your own. If you expect to be compensated for a referral, it won't take you much time to email two or three agents and to follow up those emails with a phone call. 
• Know what to ask when you call a potential receiving agent about a referral.  Does your client have specific needs and requirements?  Is the receiving agent able to assist them right away?  Is that receiving agent experienced in handling the type of property your clients wish to buy, sell or rent?

Here's a script that I use with my clients when I'm sending them to an agent in another state or city:

"As you requested, I've done some research on your behalf to find you a great agent in _______ who will meet your needs and I've also spoken with that agent.  I believe he/she has the skills to assist you with your real estate transaction and they'll be a good match for you. 

Please call or email this agent right away and then please let me know what you think once you've made contact with them. If the agent I've found for you isn't a good match, let me know and we will take the time to sit down together to search for the right agent to get the job done."

By getting involved at the beginning of the referral process, you show your client that you care about the success of their referral, and that you're willing to put forth some time and effort to help make that referral a success. 

That's the way to earn your referral fee.