Easy Money But Can't Find Any Serious Takers - Richmond/Petersburg (Boones Mill: sales, real estate)

[cjthebroker]

Can anyone tell me what I'm doing wrong? I'm new to the area, I buy and sell real estate. So I put several ads in the paper for "finders" which is basically anyone who refers to me someone selling or buying a house and gets 20% of my commission. So if they refer a person who wants to sell a $200,000 house and the seller pays me 6% commission, the person referring would make $2400. Refer 5 houses to me and that's $12000 a month!!! Sounds like easy money right? So why isn't my phone ringing off the hook. Can anyone out there explain this to me, because I thought by offering such a GENEROUS commission, I would have absolutely no problem finding people. After all, you don't need to do anything except keep your eyes and ears open to find people wanting to sell or buy a house. I don't believe there are no people in Richmond/Petersburg interested in making extra money!! I'm will also pay a GENEROUS finder's fee if someone is going to lose their house or just wants out of it and needs someone to take over their payments or just buy their house for cash. Everything is done by a legal contract and you get your money right at closing on the property. So again I ask does anyone have any ideas for what I am doing wrong. I am new to the Richmond area, so I don't know where to advertise this. In Massachusetts, I didn't even need to advertise, I had people who made a living off of me by referring homeseller and homebuyers to me. Appreciate any help!.

[Need_affordable_home]

Maybe because they can become realtors themselves and keep the full 6% commission? I know I would much rather become a realtor and get the whole deal than help make another realtor rich and only get 20%

[DavidS827]

Licensed agents are also not allowed to pay non-licensed persons any fee for referrals in VA.

[seanpecor]

Originally Posted by DavidS827

Licensed agents are also not allowed to pay non-licensed persons any fee for referrals in VA.

Is this true in all cases? I live in Boones Mill, VA and among other things I run a web site called NewHorse.com which is a resource to help folks locate equestrian professionals (training, instruction, boarding etc). It's one of my smaller sites (~ 2,400 visitors daily) but it's growing and I'm noticing alot of folks searching for horse friendly properties through the site. I'm definitely going to be adding a facility to allow realtors/individuals to submit property listings for free (with prominence given to paying advertisers). But I was also tinkering with the idea of a finder's fee based program similar to my Editor's Pick program on my flagship site (Marketingtool.com). In that program I get a finder's fee based on the contract amount. The Assoc. of Realtors prohibiting finder's fees to non-licensed individuals was not something I had even considered. I guess I'll have to do more serious research before I move forward with that particular project.

Sean

[DavidS827]

If you are licensed and the other person isn't, then no you can't give them any sort of referral fee at all.

There are also plenty of rules that govern how fees can be paid, how/when the parties of the contract are notified and to whom the fees can be paid when it is between licensed agents

[williamsburgfan]

do you really want to know what you are doing wrong? Underestimating people.

slimy, shady, illegal businesspeople can be seen a mile away. Anyone with a need can find a reputable realtor with a long list of satisfied clients.

[lynette1972]

hi im lynette can you please tell me where you buy houses. im from mississippi i would love to find propertys and make money can you please leave me your contact information thank you

[Playball40]

Originally Posted by DavidS827

Licensed agents are also not allowed to pay non-licensed persons any fee for referrals in VA.

Florida is the same. That is a huge NO NO!

[christina0001]

I'm guessing the OP is not a real estate agent, just someone who is looking to buy preforclosures and flip them.

[eddierosenthal]

I too was interested in finding out the answer to the question - what is wrong with giving an appreciative gift whether token or more - to someone who refers business to me - so I read the laws concerning RESPA - Real Estate Settlement Procedure Act and could not find an ethical reason why it should not be so - nor could I find a case that showed an opinion contrary to my own opinion. I called The California Association of Realtors and talked to a lawyer there - she said I would not be violating State Law but would be violating Federal Law - but I did take away from the tone of our conversation that the law was a bit unfair and not much regulated - I already knew that everyone in the business gives referral fees after the fact and I wanted to be more transparent about it - so i wrote to Robert Bruss - the syndicated columnist who answers questions like these every day - here is the complete question and answer I received.
Question: If it can be shown that A buyer or a seller has received fair treatment by those involved in the purchase of a 1-4 residential home transaction; including title and real estate companies etc; then is it or why would it be a violation of the Federal Real Estate Settlement Act to show appreciation for the referral of the buyer's name or sellers' name to the real estate agent by the non-licensed person giving the referral, after the transaction has closed and the renumeration did not effect escrow at all?


In California, it is illegal for a real estate licensee to share a real estate sales commission with an unlicensed person. However, it is legal for a real estate licensee to give a gift to a person who referred a buyer or seller to the licensee. Bob Bruss.

and to be fair it is not 'sleazy' to want to show appreciation. It would be sleazy to kickback to people who are directly involved in a transaction and who make money during the transaction and who participated in it without telling the buyer or seller about it. As for what people can see a mile away, most people don't know or understand the business, the difficulties in getting clients, no matter how well you go about your business. There are those in the business who have been here a long time who have a huge client base, and do excellently, and there are those who have very few returning client base and have to find new ones every day. There are many reasons why that is so, and i would not jump to the conclusion that someone does their job badly and that is the reason they have no clients. One has to have the temperament to be in a sales commission type of industry and do well. If one doesn't have the personality of a glad-handed 30 year industry expert, but still does the job, should that person be branded a sleze? I don't think so.