"Reward" doesn't have to mean "give them something with monetary value." You can send a hand-written thank you card. You can invite them out for lunch, which you should be doing anyway. You can send a small gift at the holidays so it doesn't look and feel like a quid pro quo. You can reciprocate by sending referrals back.
At the very least you should call and say "thank you." Everybody wants to feel appreciated and special.
The IL Real Estate License Act of 2000 forbids any form of compensation (anything of value) to be given to someone who is unlicensed for referrals of real estate clients.
You may send them a thank you note or card, or take them out to dinner/lunch...basically anything that would not involve a gift card or other payment.
Here is the reference in the Administrative Rules
Section 1450.780 Referral Fees and Affinity Relationships
a) No licensee may pay a referral fee to an unlicensed person who is not a principal to the transaction. In order to meet the license requirement, the person receiving the referral fee must be duly licensed as a leasing agent, broker or managing broker in Illinois or hold an equivalent license of another state or country of domicile. If the person's country of domicile does not have a licensing statute for licensees, in order to receive a referral fee, the person must comply with the laws, if any, of the country of domicile concerning the practice of real estate.
Hope this helps! Annette Panzek
Licensed Real Estate Instructor & Trainer
Depends on the referral and the client needs. Stick to the law, never anything over 50 dollars and can be a gift card, to a cleaning lady, or just helping them with something they need.
I immediately contact them to say thank you and then drop a coffee card in the mail with a hand written note letting them know how much I appreciate the referral, irregardless of whether we close a deal or not.
Showing a little gratitude for a great referral is never a bad thing. I send my referrals personalized gifts or do something to promote what they do. I thinks it's a great thing to reward connections that send good referrals. It's not a payoff its a gratuity. A wonderful way to say thank you. So thank you for your question...I am going to keep rewarding my clients with good referrals and remember to be grateful for the clients who send referrals that are not so much. We grow when we appreciate the little things.
Have you ever been to Disneyland? If you had, you told everyone about the experience. The magic there earned the reputation of the 'the Happiest Place on Earth.'
And no one paid you for it.
While you may see some results with payments, you would see a lot more results with a referral system.
When you apy people for leads/referrals, here's what happens:
1 you cheapen the referral. You're going to collect 3-6% on a half million dollar property and send me $50 to say Thank You??
2 You give the impression that 'we are even now', which is the last thing you want to do with a referral.
3 You end the referral relationship. They referred, you paid. It's the same as picking up dry cleaning. Once you pick up your clothes and pay for them, there is no reason for any further connection.
4 You ignore why people refer. People who have had a great experience believe they have a secret. They will share with others to make themselves feel good and look like they are 'in the know'. That's not encouraged by flowers or a little gift.
There are lots of ways to establish a referral system that isn't perceived as a car dealers 'pay for leads' program.
I've moved 16 times in 23 years. Between meaningless closing gifts and thoughtless 'referral' programs, I only have a single realtor I have ever referred. And they had a great referral system.
You can do what you've always done or look into exactly how people think, perceive, and react. Results are better when you understand people...
As a rule people refer me because they know I will treat their friends and family with the utmost care so I may give them a call or drop by with a coffee however treating their people right is usually thanks enough.
The best way to reward a client who has send a referral is by monetary compensation and by letting them know that you will also reciprocate by sending clients their way.
When a federally insured loan is involved, one should be concerned about paying a referral fee to a non licensed real estate agent as a RESPA violation.
Answers (1-10)
"Reward" doesn't have to mean "give them something with monetary value." You can send a hand-written thank you card. You can invite them out for lunch, which you should be doing anyway. You can send a small gift at the holidays so it doesn't look and feel like a quid pro quo. You can reciprocate by sending referrals back.
At the very least you should call and say "thank you." Everybody wants to feel appreciated and special.
The IL Real Estate License Act of 2000 forbids any form of compensation (anything of value) to be given to someone who is unlicensed for referrals of real estate clients.
You may send them a thank you note or card, or take them out to dinner/lunch...basically anything that would not involve a gift card or other payment.
Here is the reference in the Administrative Rules
Section 1450.780 Referral Fees and Affinity Relationships
a) No licensee may pay a referral fee to an unlicensed person who is not a principal to the transaction. In order to meet the license requirement, the person receiving the referral fee must be duly licensed as a leasing agent, broker or managing broker in Illinois or hold an equivalent license of another state or country of domicile. If the person's country of domicile does not have a licensing statute for licensees, in order to receive a referral fee, the person must comply with the laws, if any, of the country of domicile concerning the practice of real estate.
Hope this helps!Annette Panzek
Licensed Real Estate Instructor & Trainer
Depends on the referral and the client needs. Stick to the law, never anything over 50 dollars and can be a gift card, to a cleaning lady, or just helping them with something they need.
I immediately contact them to say thank you and then drop a coffee card in the mail with a hand written note letting them know how much I appreciate the referral, irregardless of whether we close a deal or not.
We discuss the type of opportunity. Thank you
Showing a little gratitude for a great referral is never a bad thing. I send my referrals personalized gifts or do something to promote what they do. I thinks it's a great thing to reward connections that send good referrals. It's not a payoff its a gratuity. A wonderful way to say thank you. So thank you for your question...I am going to keep rewarding my clients with good referrals and remember to be grateful for the clients who send referrals that are not so much. We grow when we appreciate the little things.
Have you ever been to Disneyland? If you had, you told everyone about the experience. The magic there earned the reputation of the 'the Happiest Place on Earth.'
And no one paid you for it.
While you may see some results with payments, you would see a lot more results with a referral system.
When you apy people for leads/referrals, here's what happens:
1 you cheapen the referral. You're going to collect 3-6% on a half million dollar property and send me $50 to say Thank You??
2 You give the impression that 'we are even now', which is the last thing you want to do with a referral.
3 You end the referral relationship. They referred, you paid. It's the same as picking up dry cleaning. Once you pick up your clothes and pay for them, there is no reason for any further connection.
4 You ignore why people refer. People who have had a great experience believe they have a secret. They will share with others to make themselves feel good and look like they are 'in the know'. That's not encouraged by flowers or a little gift.
There are lots of ways to establish a referral system that isn't perceived as a car dealers 'pay for leads' program.
I've moved 16 times in 23 years. Between meaningless closing gifts and thoughtless 'referral' programs, I only have a single realtor I have ever referred. And they had a great referral system.
You can do what you've always done or look into exactly how people think, perceive, and react. Results are better when you understand people...
Mark
Want more marketing answers? Go to www.TabletMarketingAcademy.com , a completely free, no credit card required, site. Or follow me on www.Quora.com.
As a rule people refer me because they know I will treat their friends and family with the utmost care so I may give them a call or drop by with a coffee however treating their people right is usually thanks enough.
The best way to reward a client who has send a referral is by monetary compensation and by letting them know that you will also reciprocate by sending clients their way.
When a federally insured loan is involved, one should be concerned about paying a referral fee to a non licensed real estate agent as a RESPA violation.