Special offer

My $17,000 Loan To Client - First Time Real Estate Edition

By
Real Estate Broker/Owner with KD Realty - 408.972.1822 CA DRE#01366594

Patricia Kennedy is hosting an October Contest – Your First Time-The Real Estate Edition

 

The challenge is about sharing a story of our first interaction with a client or customer (or someone else’s) that left an indelible mark on our psyche.

  

What happened?  I was a very new real estate agent. My very dear and long-time friends referred one of their long-time family friends to me. Their friend was looking to buy her very first home

 

The referred friend and I met and got along well. The search was on!  We pounded the pavement and looked at homes all over Santa Clara County.  She was open to where she lived because she could tele-commute and at her price point, there we limitations.

 

When it came time to write that first offer I learned that despite the fact that she was pre-approved, the source of her deposit and down payment was coming from her 401k plan.  Even back then we needed to show proof of funds with offers. 

 

Oh No, how long will it take to get the funds?  She did not know.  She had no clue how to start the process.  I sat down with her at the computer. We made a few phone calls to the plan administrator and initiated the process.  It tookd several hours to complete. It would take about two weeks to get the funds.

 

Oh No, we need the money now.  I am almost too embarrassed to admit this.  I said “almost” too embarrassed.  I had money in the bank and an equity line of credit. Yes, I did. I wrote a check for $17,000 and told her she can pay me back when the 401k funds come through. 

 

stacks of fifty-dollar bills

 

Was I terrified or totally confident?  I was not terrified at all.  I was totally confident that she would make good on the money.  I trusted her.  She was like family to my dear friends. I had no doubt that the funds would be returned to me in a short period of time. And they were. 

 

Did I actually have any idea what I was doing? Yes, 100%. Some might say I was crazy or out of my mind ... yet I knew what I was doing.  

 

Was there help from a broker-in-charge or mentor there to help you, and did they actually help?  I was flying solo on this. I knew what I was doing and did not need help.  By the way, I cleared it with the lender that pre-approved my client.

 

Were any old pros involved, and were they nice or were they stinkers?  The old Pro would have to be the lender in this situation. He was a seasoned lender that owned and managed his business.  

 

Did it have a happy ending?  Yes.  I wrote several offers that were not accepted. The one offer that was accepted my client backed out of shortly after the offer was accepted. She felt the place was really not right for her. 

 

She wanted to look for a home in the mountains versus a condo in Santa Clara County. We searched in torrential down-pouring rain. That alone tells how long ago this was because California has been a drought state for many years. I was in an area I was familiar with, Santa Cruz County, yet I was not familiar with the real estate aspect as much as I needed to be to confidently serve her. 

 

While backing my car up a hill in pouring rain I hit a rather large boulder.  I knew in that moment that it was time for me to refer her to a local agent. She protested. She wanted me. She trusted me. In the end, I made a great referral.  She found the perfect home situated around redwood trees. It was what she really wanted. I attended her house-warming with the agent I referred. My client still lives there today. She has done many improvements and loves her home. 

 

What did I learn?  I learned what I already knew.  Trust my gut and follow my heart. Would I do the same thing again? With that client? Yes.  Not with anyone else in terms of floating a $17,000 loan, or any amount of loan. I am not a lending institution.  

 

Real estate is a people business. In the 14 plus years I have been in real estate people ask me what I like about it, and what I dislike about real estate.  The answer is the same.

 

The People. I see the best in people and the not-so-shinning-bright-and-best in people. I see sides of people I would not otherwise see. There is a level of intimacy involved in a real estate transaction that brings people out and causes people to hide.

 

I see their fears. I feel their joy. I feel their gratitude. I experience their greed. I hear unabashed truth and things I wish I had not heard. I hear unthinkable lies and deceit.

I feel their pain and sadness through divorce and death of a loved one.  

I learned so much more about myself in real estate because of the people. 

Posted by

Let's talk
(408) 972-1822

Email me
Blog | About Me

Probate Real Estate Services
San Jose Real Estate Website

    

DRE#01366594

I specialize in probate real estate.
As a Certified Probate
Real Estate Specialist
my focus is on helping Executors and Administrators
avoid headaches
before they start.

“From the moment we met Kathleen, we were impressed with her professionalism, knowledge, patience, respect, humor, attention to detail, and compassion.  She's the Whole Package ~ excellent agent and wonderful human being!  In a potentially stressful experience, we have felt in good hands all along.  We are so grateful and recommend her without hesitation!”

Read More Testimonials

 

Comments(32)

Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Years ago, long before I was ever a real estate agent, my family was moving up to a second home.  We were using proceed from our existing home to do that. When the sale of our first home fell out of escrow, and we didn't have as much money as we thought to put down on the closing of the second house, our agent loaned us enough to proceed.  We paid her back with a little interest, when our first home sold.  She was a great agent!

Oct 07, 2016 11:27 AM
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

I'd never finance a client's home purchase.  We'd just wait until 401K funds were available.  Karma points for sure!!

Oct 07, 2016 12:32 PM
Laura Allen, Lake Tahoe - Truckee Real Estate for Sale TahoeLauraRealEstate.com
Coldwell Banker Realty, Tahoe City, CA (530) 414-1260 - Tahoe City, CA
Tahoe Real Estate Agent Helping Buyers and Sellers

Kathleen Daniels - Wow!  You learned a lot, and you were willing to put yourself out there ($17,000 is what we call faith and belief in another person).  In the end, even though you had to make a referral, your client found the right place and is still happy to this day! Now that's a great success story and the beginning of a wonderful career!

Oct 07, 2016 02:53 PM
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

You're absolutely right when you say you can just have "gut feelings" about certain clients, Kathleen Daniels ... and you're gut must have been talking pretty loudly to offer to lend that kind of money.  

 

Your actions ... and the actions of your past client ... prove that good and honorable people still exist in this world ...

Gene

Oct 08, 2016 05:35 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

That would be a scary thought waiting to see of they would be paying it back Kathleen Daniels 

Oct 08, 2016 06:29 AM
Mark Don McInnes, Sandpoint-Idaho
Sandpoint Realty LLC - Sandpoint, ID
North Idaho Real Estate - 208-255.6227

Hello Kathleen.  Brave sole yes you are.  And yet as you say, there are times that we just 'know'.  Well done.  Mark

Oct 08, 2016 06:36 AM
Ed Silva, 203-206-0754
Mapleridge Realty, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

That was really going above and beyond to help a client.  It is the people that makes this business fun.

Oct 08, 2016 11:55 AM
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Flower Mound, TX
Selling Homes Changing Lives

That was a HUGE leap of fate and an amazing Random Act of Kindness. I'm sure you were blessed many times over in ways you least expected.

Oct 08, 2016 05:00 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Kathleen Daniels  indeed we believe in the same as to what we like and what we do not like about our career, it's the people. What a story and glad you were/are a good judge of character:))Endre

Oct 09, 2016 10:25 AM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

You went above and beyond. I know you trusted it would work out. One good lesson to learn is when to refer a client out and when to hang in there. Nice story, Kathleen.

Oct 09, 2016 12:15 PM
Gary Frimann, CRS, GRI, SRES
Eagle Ridge Realty / Signature Homes & Estates - Gilroy, CA
REALTOR and Broker

Kathleen, I have a similar story-- loaned a client $22,500 for two days while their house in Lake County closed, and funds were transferred.  It was a risk, but they were going to be new neighbors (which could've made it a whole lot worse) and we had an escrow officer who was sort of directing us on this one.  It was during the sub-prime days when anything went, so not sure if it was totally legal.  The loan was a prime loan, but there was a lot of sloppiness involved.  Four years later, when the client moved, they didn't use me, but a friend, which was fine with me actually, as it was now a divorce sale.

Oct 11, 2016 03:47 AM
Nancy Frimann
Eagle Ridge Realty/Signature Homes & Estates - Gilroy, CA

^^^Yes, my husband really did do this, and I found out only after the fact.  It was one of my early transactions with him.  I would never have let him do this...  I was rather perturbed.  I did pay a painter once a couple of hundred dollars to paint a room for a cash-poor seller, and got reimbursed in escrow, but that is as far as I'll go...

Oct 11, 2016 03:55 AM
Mary Yonkers
Alan Kells School of Real Estate/Howard Hanna Real Estate - Erie, PA
Erie/PA Real Estate Instructor

What an amazing first post Kathleen Daniels and so happy you were repaid promptly.

Oct 17, 2016 06:47 AM
Evelyn Johnston
Friends & Neighbors Real Estate - Elkhart, IN
The People You Know, Like and Trust!

When you know it is right, you just do it.  And you did, it turned out fine.

Oct 21, 2016 01:40 PM
Hella M. Rothwell, Broker/Realtor®
Carmel by the Sea, CA
Rothwell Realty Inc. CA#01968433 Carmel-by-the-Sea

Hi Kathleen: Yes, in our business we get to see so many sides of our clients. Some try to hide parts of themselves and their lives, but it doesn't last long. True colors come out in the end, good or bad! On lending the money? We see so many people over the course of our career that back out of contracts, especially if they have no "skin" in the game. I'm glad it worked out for you.

Oct 22, 2016 03:18 AM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC

Kathleen

Our real estate career is a work in process . . . . and we learn as we go. Our lessons are many . . . . the key is to learn from them.

Good luck and success.

Lou Ludwig

Oct 22, 2016 12:11 PM
Georgie Hunter R(S) 58089
Hawai'i Life Real Estate Brokers - Haiku, HI
Maui Real Estate sales and lifestyle info

You were so gracious to lend your own money to make her dreams come true!  It's better to be an optimist than go through life always thinking everyone is out to cheat you.

Oct 31, 2016 10:05 AM
Elyse Berman, PA
LoKation Real Estate - Boca Raton, FL
Boca Raton FL (561) 716-7824

Kathleen Daniels What a great story.  I'm glad it had a happy ending.  I was worried there for a while.

Nov 05, 2016 04:34 PM
The Villages Realty
The Villages Realty - San Jose, CA
"Our Performance Will Move You!"

Hello Kathleen Damiels.  Just checking out some of your older posts.  I especially like the older market reports and the Friday Funnies!  Keep it up.

Feb 18, 2017 07:57 AM
Eagle Ridge Realty
Eagle Ridge Realty - Gilroy, CA
"Our Performance Will Move You!"

Hi Kathleen.  Enjoying some of your previous posts and reading some good stuff here.

Feb 20, 2017 07:06 AM