You have an accepted offer and you are ready to go. Congratulations! Only 30 days until the closing. You’re over the hurdle… or are you?

While the end of the transaction may seem within reach, there are often events that occur after an offer is accepted that lead to cancellation or—at a minimum—a very turbulent transaction.

Transaction Terror: Do you impede your closings?

Here are 6 ways that agents often sabotage their own pending transactions.

• Writing Offers for Buyers Who Are Not Qualified. Sometimes agents get so excited about a new homebuyer lead that they scoot around town showing properties and writing offers, only to learn that the buyer isn’t well-qualified. Always communicate with the buyer’s lender to confirm that the lender has completed a full pre-qualification, and not just a cursory phone interview. Make sure that the lender has checked credit and completed income verification. No agents should write offers for buyers who aren’t ready to buy; that’s a sure way to end up at cancellation not closing.

• Neglecting Due Diligence Activities. You’ve heard the adage, “Slow and steady wins the race.” It applies real estate and your due diligence. Always take time to properly investigate a property before putting a buyer into a pending transaction. Specifically, if you have not provided buyers with information about HOA fees, local schools, or the items that they indicated were crucial to their buying decisions prior to writing the offer, you may be the cart before the horse. Buyers need all of the necessary information before making an offer. Surprises (such as high HOA fees) can be deal breakers, and you don’t want to be responsible for breaking the deal.

• Making Atypical Requests. Pending transactions often fall through after the buyer conducts the home inspection. To assure that this doesn’t happen to you, agents need to carefully manage any repair requests or issues that arise after the property inspection. If a buyer wants all new flooring and paint, for example, this could be the death of the transaction. Make sure to work with clients and set appropriate expectations before you make irrational or extreme requests that could send the transaction down a bad path.

• Generating Inappropriate Communication. Agents also frequently wreak havoc on their own transactions by communicating inappropriately with other agents. Always keep all emails short and professional. If you have something more significant to share, try to handle it over the phone. If you are angry, perhaps you should keep that anger to yourself. Unprofessional email and text messages are not conducive to a smooth and efficient transaction.

• Relying on Email to Deliver Bad News. Agents often act as saboteurs when they deliver bad news via email. Almost any sort of news—from a delayed closing to an additional buyer or seller cost—is best delivered over the telephone since written communication can often be misinterpreted. When you run your business solely via email and text messages, you run the risk of creating problems instead of resolving them.

• Allowing Emotion to Reign Supreme. Arguably one of the most challenging aspects of a real estate transaction is keeping personal feelings and emotions at bay. Buyers may have an overly strong attachment to a repair request or piece of personal property that they want included. Sellers likely have strong emotions because they are disconnecting from their property. The best way to assure a smooth transaction is to avoid getting embroiled in this emotional drama. Always act as the voice of wisdom and remind your client that he or she hired you in order to be objective.

Agents are like pilots; they control turbulence. Transactions are stressful, and they involve a lot of ups and downs. It is your job to mitigate that stress by solving problems, anticipating difficulties and averting them before the transaction becomes an all-out failure. While you cannot guarantee that the real estate transaction will have no ups and downs, through your expertise, you can work to make the ride as smooth and efficient as possible.

Last week was a really interesting week for me in the real estate business, as I got 6 awesome real estate referrals that I was able to share with the agents at my office.

Lots of agents are seeking referrals in order to add more buyer and seller leads to their sales pipeline. So, I thought it might be helpful for me to review where these leads came from and how they were converted—perhaps this will give you some ideas for ways to generate more referral leads in your own real estate business.

6 Sources of Real Estate Referrals

1. Referral Exchange. If you are not a member of Referral Exchange, then you should join now. It’s a national network (membership required) and when an agent enters in a referral or when a buyer or seller goes on the Referral Exchange website, if the lead is for your area or community, you get an alert on your phone. Way to go Referral Exchange. This is the third Referral Exchange lead that we have converted this month, and we’ve manually entered about 8 leads into the system where we receive the referral fee once the out-of-area transaction closes. Referral Exchange takes care of the billing and the payments; this makes the whole process a piece of cake (or a piece of cheese, as my husband says).
2. My Weekly Email Newsletter. An out-of-area agent has a relative who needs to sell his home in my area, so she gave me a call to see if I wanted to accept the seller referral. I asked her if we had met before, and she told me that she had been reading my email newsletter for years and remembered that I was from the area.
3. Local Agent. An agent friend of mine from another brokerage is a bit under the weather and was about to take a listing. She looked long and hard at her recovery, and realized that she wasn’t going to be able to give her client the attention the client deserved. So, she called me to see if our company would take the listing off her hands.
4. Investment Company. A local real estate investment company that buys, fixes, and flips contacted me to see whether we would represent them in the purchase and sale of a property. What a no brainer. Always have a few investors in your side pocket in case you come across some properties that need “a fix.”
5. Former Agent from Our Brokerage. A former agent from our brokerage that works in another part of the county reached out to us to see whether we could help him with a multi-million dollar transaction. Our former agent is awesome, but has only been in the business a few years, so he felt it would be good if he were supported in such a large transaction.
6. Past Client. Lots of people get referrals from past clients; that’s not uncommon. We have probably received more than one this week from a past client. But, one that comes to mind is a family who referred their brother to sell his home and buy a bigger one.

Reflecting on this pretty awesome list, all I can say is that we, as agents, have to be able to spin lots and lots of plates at the same time. It is almost as if we are in the circus, since we seem to have lots and lots of things to balance and juggle. But, if you can do that effectively with good systems and tools, they hard work of the balancing act will pay off big.

You may have heard of this age-old advice in home sales. In a competitive market, a buyer’s agent wants to give their client a competitive edge by attaching a beautifully formatted “love letter” to the offer. The letter talks about how much the family loves the backyard, how perfect the neighborhood is for their kids, or how they cannot wait to host holiday dinners in the dining room. This was considered a great relationship-building strategy. Sellers loved knowing who would be taking care of their beloved home.

While it’s wholesome and heart-warming, the reality these days is that these letters are no longer a harmless marketing tool. But they can be a liability.

National risk management experts and legal counsel across the country have sounded the alarm on this practice. Forwarding these letters can land you, your brokerage, and your seller in the middle of a devastating federal lawsuit.

Why this Seemingly Simple Letter Can Be a Legal Minefield

The federal Fair Housing Act explicitly states that a seller cannot refuse to sell a house based on race, religion, color, national origin, sex, familial status, or disability.

When a buyer writes a letter explaining that their children would love to grow up in the house, they are inadvertently introducing familial status into the negotiation. If the seller chooses that offer over an identical or stronger offer from a single individual or a childless couple, that rejected buyer has clear grounds for a housing discrimination complaint.

The National Association of Realtors has issued strict guidance warning agents that these letters frequently contain photos or subtle descriptions that reveal protected characteristics.

The legal consequences are incredibly steep. HUD (the Department of Housing and Urban Development) regularly adjusts civil penalties for inflation. A first-time violation of the Fair Housing Act can result in a baseline fine exceeding $23,000. That does not even include the devastating cost of legal fees, damage to your reputation, or the potential loss of your real estate license.

Numbers Over Narrative

Our job as real estate professionals is to protect our clients from liability while getting the deal closed. The days of using subjective personal narratives to influence a contract are over.

Many progressive brokerages and state associations now explicitly advise listing agents to document a flat refusal to accept buyer letters in the MLS notes. You can protect your sellers by having them sign a disclosure stating they will only review the financial terms of an offer, completely removing personal bias from the equation.

Let the numbers do the talking. A clean, strong offer backed by solid pre-approval documentation or proof of funds is what wins deals in today’s market. If a buyer is facing a complex situation, like purchasing a distressed property, focus entirely on the objective logistics of the timeline and the transaction structure. Leave the emotional storytelling completely off the table.

Protect Yourself

At the end of the day, real estate is a business transaction involving a major financial asset. While we cannot control every assumption a human being might make when reading a contract, we can absolutely control the evidence we facilitate.

Stop encouraging your buyers to write letters, and stop forwarding them to your sellers. Instruct your administrative team or assistants to strip these letters from offer packages before they ever hit your client’s desk.

In a world where everyone has the right to sue, keeping your transactions strictly professional isn’t just good etiquette, but it is the only way to safeguard your business, your reputation and your commission.

While the general public may believe that anyone with a luxury car or a designer handbag can sell a home, unfortunately it’s just not that easy. To effectively identify consumers who are ready, willing, and able to buy or sell involves a great deal of skill—not only in putting together a transaction, but also in assuring that the transaction gets to the closing table.

While it’s true that both buyers and sellers can cause a good transaction to run amok, so too can the real estate professional.

Here are the 6 most common ways that agents can derail a deal:

Overselling, Not Listening. It’s true that your goal is to close. But, at what cost? Remember that you have a fiduciary obligation to your client. To that end, you need to listen carefully to what buyers and sellers want and need; don’t foist your opinions on them or encourage them to do something that they do not want to do. If you even get the slightest hint that your client has cold feet, don’t oversell. Most clients with cold feet will pull out at some point in the transaction Better to listen carefully and help your client to purchase or sell according to their own needs and not yours.

No Contact with the Buyer’s Lender. If your client comes to you with a lender pre-qualification letter, make sure to contact the lender prior to touring homes. You’ve got to make sure you understand the loan terms before you write the offer; you also want to confirm that the lender qualification is based on a formal documentation review and credit check. There’s nothing worse than learning that your client doesn’t qualify after you’ve gone out looking for homes and even had an offer accepted.

Responding Quickly. Rushing things in real estate never works to your benefit. If you and your seller are too quick to respond to an offer, you may not have had time to carefully weigh all terms. Additionally, when your hurry, you may close the door on other offers that are incoming. There are so many parties involved in a transaction and so many details to review. When people rush, mistakes are made.

Making Decisions that Aren’t Yours to Make. Here’s a typical agent response: “My client told me to say…” or “My client wants…” In truth, most agents haven’t even reviewed the subject in question with their clients. While it is your fiduciary obligation to do what is best for your client, it is beyond the scope of your role to make decisions on behalf of your client. Always check in with your client and make sure that your comments and communications reflect your client’s wishes.

Poor Communication with Clients. You’ve represented lots of buyers and sellers, but it is likely that your client has only been involved in a few transactions. Transactions can be stressful, and it is the agent’s job—your job—to mitigate that stress with excellent communication skills. Be careful in how you deliver bad news. Deliberate and soft language will keep all parties content and relaxed throughout the transaction.

Sending Inappropriate Email. Email makes it just so easy for agents to do their jobs. After all, we are expected to keep so many plates spinning at the same time. Watch what you say. Some things are better left for phone conversations, and email messages are often misinterpreted. When problems arise, it usually takes multiple emails to resolve something that could be handled in a 40-second phone conversation. Keep your emails short and professional.

Transaction tragedy does occur, and transactions can be derailed. Just try your best to assure that it is not you who derails them.

When we were growing up, we got to take a lot of after school enrichment classes. From Girl Scouts to tennis to tee-ball to cooking, when I was little, I had classes in just about everything. In fact, it’s actually become a family joke, where my husband sometimes says, “Don’t tell me… you had a class on that when you were younger, didn’t you?”

According to data on closings for San Diego County, the average real estate professional closes 5.5 transactions per year. That converts to one closing every 66 days. If you are only closing one transaction every two months or so, you may not see the kinds of wacky things that busy real estate professionals closing upwards of 100 transactions per year see fly past their desks. You may not have the level of expertise that comes with that significant number of closings. (But, don’t worry. You can take classes to gain insights instead.)

Attract Bees with Honey, Not Vinegar

As someone who is involved in a pretty significant number of closings each year, I’m noticing a new trend. Maybe it is a California thing, I don’t know. (After all, we do live up to our reputation as a pretty litigious state.) What I notice is that in order to solve problems, inexperienced agents often wield a stick instead of dangling a carrot.

If you need to work out something with the other agent, you’ve got to consider your options. Here are three things NOT to do when faced with a challenging real estate problem:

1. Do not threaten mediation or arbitration unless you fully understand what mediation and arbitration involve. For example, do not say that you are going to take someone to mediation over a $50 bill, unless you are certain that the fee for mediation is less than the amount owed on the bill (otherwise you demonstrate your lack of expertise). 
2. Do not threaten to report someone to the state licensing authority unless you are certain that they have done something that is under the auspices of the state licensing authority. For example, scam artists often advertise listings as rentals on Craigslist. Sometimes the listing agent doesn’t know about the scam until a consumer alerts them. That is absolutely not something under the auspices of the state licensing authority. 
3. Do not provide legal advice to your client unless you are an attorney. In fact, even if you want to give some real estate advice, only advise on what you know and not what you think you know. Seek a mentor or check in with your broker to learn the best solutions and then get back to your client with the best advice possible.

If you do not have a lot of experience in real estate, that’s okay. But, by all means, never ever wield the stick when you don’t know how to do so. Instead, dangle a carrot of offer some honey and work with the other parties to the transaction so that you can see the next successful closing in your future.

You’ve got the call, you’ve met the clients, and you’ve officially made it “listing official.” Congratulations! But before you start imagining the walk down the aisle to the closing table, ask yourself: Is this property actually “The One,” or is it just a summer fling that’s going to leave you ghosted?

If you’re already spending your commission in your head, it’s time for a reality check. The honeymoon phase ends quickly when a property sits on the market.

Here are 4 reasons your new listing might lead to a breakup instead of a closing:

1. The Price tag is “Playing Hard to Get”

Love might be priceless, but real estate certainly isn’t. Statistics show that sellers who overprice their homes decrease their “dating pool” of buyers by at least 50%. When a property lingers on the market, buyers start to wonder what’s wrong under the surface, is it a bad personality or a floor plan only a mother could love? Use market data to find that “sweet spot” price. If your sellers are still playing hard to get, suggest an objective third-party appraisal to act as the relationship counselor.

2. Location: Looking for Love in All the Wrong Places

We’ve all heard that “location is everything” in love and real estate. A gorgeous home loses its luster if its backyard neighbor is a noisy highway or a neon-lit strip mall. While water views are the “tall, dark, and handsome” of the industry, remember that there is a lid for every pot. If the home shows pride of ownership, there’s a buyer out there ready to fall head over heels, you just might have to work a little harder to play Cupid.

3. An Uncooperative Seller (The “It’s Complicated” Status)

A successful sale requires total commitment. If your seller is playing “hard to reach,” it’s going to be a rocky road. Sellers need to be flexible with showings, open to weekend dates (open houses), and willing to let buyers in via lockbox. If they only want to show the home every third Saturday when the moon is full, they aren’t ready for a serious relationship with a buyer. You can’t find a match if the door is always locked!

4. Property Condition: Needs a Makeover

First impressions are everything on a first date. If a listing has “bad hygiene”, think unmade beds, cluttered counters, or deferred maintenance, buyers will swipe left immediately. To get that “love at first sight” reaction, the home needs to be in tip-top shape. Remind your sellers that they are competing with “fresher” listings. A little bit of staging and cleaning is the real-estate equivalent of a bouquet of roses; it makes everything better.

Set Expectations for a “Happily Ever After”

The secret to a long-lasting professional relationship is getting everyone on the same page from the start. When sellers trust your expertise, you avoid the heartbreak of a stale listing and move straight to the honeymoon phase: Closing Day.

Don’t let the paperwork kill the mood! While you’re out playing Cupid and finding the perfect buyers, let our Transaction Management Team handle the nitty-gritty details. We’ll manage the files from “Contract to Closing” so you can keep your focus on what you love: growing your business.