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Dominic Nicoli, Inaugural Member of the Intero Real Estate Services Hall of Fame
"Inspirational and entertaining while literally providing a pathway to success."
Adam Eyre, Top 100 Lender at PrimeLending and previously Top 100 at Wells Fargo Bank
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A SUCCESS GUIDE
for real estate lenders, real estate agents and those who would like to learn about the professions.
It’s an important and exciting time when you close your first deal. Congratulations! You proved to yourself and everyone around you that you can do it. Let’s start at the beginning.
Hunting for that first one. Don’t assume where it will come from. My first deal in lending came from an advertising campaign that my company was running. Those that wanted to participate could chip in money for the campaign, and then we shared the leads. So I walked in the door day one as a lender with a bunch of leads from referrals and friends, but the one that actually closed first was from a cold source.
My first deal as a real estate agent came from a friend of a friend of a loan client. I attempted to tell my lending clients that I was now a real estate agent. They weren’t buying it. What they were happy to do, however, was float my name around to their friends. So I would simply ask my friends, old customers, really anyone, “Do you know of someone that might need assistance with real estate?” I kept asking and asking and found my way to my first closed deal.
Don’t assume where your deal going to come from. It’s likely it will come from a warm source, such as a friend or family member. But keep your options open—it might surprise you. And there is no wrong answer here, so embrace any and all leads and the sourcing thereof. It’s important to get that first one under your belt and out of the way.
Continue looking. When you think you’ve found your first lead, keep looking even harder. When you do something new, it’s simply new—we don’t know how to do it yet. So it might look like a lead, smell like a lead, walk like a lead, and talk like a lead—but it’s really not a lead. Or it might be a lead, but not a lead that you want to pursue at the moment. But for the beginner, it looks like a lead. It’s going to happen. When we start, we don’t have the experience to know what a lead really is. It happened to me, it will happen to you, it happens to everyone. Over time we become wise and discerning about what a lead is. When you think you’ve found your first lead, that is the time to pour it on and find more. Keep going…
Schedule. When you are in the business a couple years and are hitting a stride, you will be spending some time daily on marketing, operations, finance, and attitude—the big four. But when you start, you have no deals and no money to manage, so your time should be spent on marketing and attitude. It will be a little rough to be spending all day every day on marketing and attitude, but make it fun and do it. It’s very important to get that first one done and out of the way. That lopsided day of marketing and attitude will not last forever; once you hit your stride and start to add some pending deals and closed deals to your menu, you’ll be able to shift your day to a more balance approach of marketing, operations, finance, and attitude. But for now, pour it on—and go hard and fast on marketing and attitude. Keep going…
Confidence. Keep saying to yourself, I can do it, I can do it, I can do it—about a million times per day. But the reality is that you are not really going to believe that until you actually do it. But in the meantime, say it anyway. It’s one of the best things we can say to children. “You can do it, Sabrina” or “You can do it, Johnny.” So why not be equally gracious to ourselves? Find that first lead. Even if it’s a terrible lead and would never close in a thousand years, find that lead anyway. It will start to build your confidence. Then, find another, and another, and another. Before you know it, you’ll have ten leads—eight crummy ones, one decent one, and one good one—but your confidence will be growing. Keep going. Find ten more. Now you have sixteen crummy ones, two decent, and two good. Keep going and your confidence continues to grow—find ten more. You still don’t have a clue what a lead looks like or smells like, but you are on the move! Now you have three decent leads and three good ones. Keep going, don’t look back…
You have momentum now. You still don’t know what a lead is or is not—but you are finding stuff nonetheless. You are finding mostly junk leads, but you are on the move and building momentum. Slowly but surely you are learning to be discerning about what a lead is and what a lead is not—for you. You learned something. Three more marbles go into the confidence bucket. Keep going. Check with your manager if your three good leads and three decent leads are anything worth working on. Keep going. Find more. Make numbers your friend. Throw away the twenty-four crummy leads or file them away as “friendlies” to be worked at a later date. Your manager and colleagues are now becoming convinced that you mean business. Keep going. Find ten more. Now you’ve found forty leads. Most of them were a train wreck—but who cares? You did it. You were able to set a goal, hunt, and find. Way to go! You still haven’t closed a deal but you are feeling (deep down inside), “Wow, I actually think I can do this.” Keep going…
Work the deal. Now you have eight leads, and you also have the confidence that you know how to keep finding more. That’s giant—don’t underestimate that confidence that you just earned. But in the meantime, keep saying “I can do it, I can do it, I can do it.” You and your manager determine that three of those leads are worth persuading. Don’t do it alone. Don’t be greedy on that first deal. I know you need the money (all of it). But don’t do it. Talk with your manager and work the deal together with an experienced person. You ever notice how an expert in any field makes it look so easy? The expert knows how to drive the car without crashing. There are about a thousand possible obstacles in the road of a real estate transaction that could cause a crash. An expert knows where those bumps are and how to avoid them. Team up! Do the deal with an experienced veteran. Talk with your manager, and make the selection together. This is serious business (for your customer) you are dealing with; you are helping someone with a loan or piece of real estate. These are long-term commitments that the customer is making. Make sure you have a pro in tow to help you. Keep going…
Find more. Between you, the veteran, and your manager, determine how to handle the deal. You be the doer, but take the coaching and advice from the veteran and the manager; get the process moving. Now you have an element of operations to be installed into your business. Not a lot, because, after all, it’s only one deal. But you can shift your day from marketing and attitude to marketing, operations, and attitude. Only a portion of the day should be spent on managing your one deal. I know it’s exciting and I know that you want to do a good job on your one deal, but maintain some mental discipline. You decide how many hours to spend daily on your one deal (operations). I am going to help you by suggesting that you spend three hours daily on operations. Keep going, however. Spend the remaining five to seven hours daily on marketing and attitude. Find more leads. What if your single deal falls apart at the eleventh hour? How will you feel? Make numbers your friend and at the same time provide a good service to your single client. Three hours daily is more than enough time. Keep going…
Overcommunicate. Overcommunicate to your customer, to your manager, and to the veteran that is helping you. Have the discussion with your customer that it’s a process and that you will be explaining all the steps as we move from point A to point Z. I know you won’t necessarily know those steps, but that’s why you have your manager and the veteran to help you. Make sure you know step fourteen. Talk it through with your manager and veteran, study it, digest it, and then explain it to your customer. You will learn it, do it, and then explain it (teach it). You will internalize it that way. Don’t assume anything. Over communicate with your team, manager, veteran, customer, and maybe an internal processor. Tell your manager, veteran, and processor that you are eager to learn and will be a good student. Ask them to set you straight when they think you are heading off course. Make them truly feel comfortable. Be coachable. Find more as you are doing all this. Keep going…
Find more. Maybe you have two active deals at this point in different stages of the process. Deal number one is scheduled to close in four weeks, and deal number two is scheduled to close in six weeks. What if both deals fall apart? Not fun! Find more. Keep looking. You still haven’t closed a deal, so keep up the push. You know how to find stuff now, so find more. You now have a more balanced day with marketing, operations, and attitude. You are managing some of your own seed money but don’t have any commission money to manage at the moment. You have your team together to handle your deals, you know how to find more, so keep going. Find ten more, and then another ten, and then another. Now, maybe you are up two pending deals, three decent leads, and five really good leads. You are making progress. Congratulations. But you need to close your first one, and the longer time goes on, the more your confidence will crack. I can do it, I can do it, I can do it. You still haven’t done it, but you are almost there now. Find more. Keep going…
Don’t count the money. We all do it, but don’t do it. Fight it. Push it out of your brain. Focus on the customer, focus on providing a good service, focus on finding more while you are providing a good service on that first deal. The money will come. Find more deals, manage your current deal(s)—marketing, operations, and attitude. You’ll be thinking about the commission money hourly now, maybe every sixty seconds. Here it comes again—purge it. Here it comes—purge. It’s not helping you and it’s not healthy. Don’t think about it. It will happen. Find more deals, manage your current deal(s). The money will come.
Congratulations! You just closed your first deal. You did IT by following a process. It might have felt like a rather haphazard, chaotic process—but it was a process nonetheless. You just earned $3,000 or $30,000 or $90,000. Whatever that number was—you did it! And you did it by focusing on the process and not the economics.
Say thank you. Demonstrate good manners and say thank you. There will be a lot of people who likely helped along the way: your family that was nervous for you; your customer; your manager that is now proud of you; the veteran colleague that helped you; the internal office team that cheered you onto victory; other colleagues in your office that you likely leaned on for advice; your vendors, such as your escrow team, inspectors, insurance people. Thank them all. They will remember how you handled yourself during this challenging part of your career.
You are now at full stride and ready to conquer the world.
Go get ’em!
Chapter 4 - Do a Lot of Business Quickly
Yes, it takes time to build something worthwhile. Then why am I encouraging you to rush it and do a lot of business quickly? Because if you don’t, it’s possible that the demands of life will force you out of this business before you have a chance to Make It.
Make a decision to push it for 180 days. I will work ten-hour days six days per week for 180 days. You might struggle with the pace for a few weeks, but you’ll grow stronger and get comfortable after about a month. And it might be noteworthy to mention that I am assuming here that you want to go big and push for big numbers. It’s perfectly fine if you want to go small or medium; the below plan, however, is only if you want to go big—and do a lot quickly.
Continuing on, “Jim, ten-hour days, six days per week sounds like a lot of work.” Yes, it is. Your goal is big, so your effort has to be big. Your goal is big, so your commitment has to be big. You have to be all in. Name me another business other than real estate that you can go from ground zero to twenty-five thousand, one hundred thousand, two hundred thousand, three hundred thousand, four hundred thousand, or even five hundred thousand in one year. Maybe you could dream one up, but the opportunity is sensational in this industry nonetheless. So recognize it and get fired up about it.
Ask your manager to coach you/mentor you for 180 days. It’s not his or her job to earn money for you. That is your responsibility. So, when you meet with your manager at these weekly coaching sessions, come loaded with questions. Don’t cry to him or her; be a pro and review the goals for that week, plans for the following week, and things that you need help with. Yes, a good manager will know how to push, support, coach, and help you grow. But don’t count on them to do that, however. Don’t place your future in someone else’s hands. Take responsibility for your own income and life. Simply use your manager as an additional resource. Use his or her experience and know-how. You run those meetings, not him or her. Ask questions. Take control. “Fortune befriends the bold”—Emily Dickinson.
Attend every staff meeting, round table, lunch club meeting, free seminar, and social function that your company has to offer. Be part of the conversation; become part of the fabric, if you will. Don’t miss anything. By doing this you will digest the rhythm of your office (e.g., who’s on first, what’s on second, and who is doing third). Understand the relationships in that office, listen to people, and ask questions about the industry. You’ll be able to turn this information into dollars down the road. I’m not going to tell you how; you figure it out.
Eat. Most of us need to eat breakfast, lunch, and dinner, and I think have a coffee from time to time. Take one day off weekly if you need to, but have lunch five days weekly with either someone in your office or a friend. Cheap is good. My personal business attorney is one of the best in Northern California. We get lunch every six months. Here are our last three lunch locations: Armadillo Willy’s, In-N-Out Burger, and Ike’s Sandwich Shop—average cost per person is $10. For lunch, keep it simple and cheap. Lunch or coffee five days per week with a friend or someone in your office is doable. You’ll build momentum. Take fifteen minutes to prep some questions. Get him or her talking. Have something to offer in terms of information. Learn something new and share it. Make it natural, because it should be natural.
Be visible and work long hours. Your manager and colleagues in your office will become believers if you show up day in, day out. Don’t forget, they see people come in and out of this business daily with big dreams and ambitions, in and out, in and out, in and out. You can earn their respect only with your work ethic and eventually your production. Until you start doing business, it will need to be your work ethic. Work day in, day out. It’s quite possible that your manager and colleagues will respect this type of work ethic and reach out to you in some tangible fashion. “Hey, Jim, I see how determined you are to make this happen. I have a big deal I’m working on now, and I’ll pay you $1,000 to run around and you can learn some things. Sound okay?” Sure. Or your manager says, “Hey, Jim, you are working hard, I see that. There is a lead that came in yesterday, and I am going to give it to you. You work it, but since you are green, I am going to have Lisa keep an eye on you, and you two split the commission. Sound okay?” Sure. You never know what type of doors may open by you simply being there and working hard.
Work through referrals. A referral is a lead that comes from someone that you know—period. “Well, Jim, I have never done a deal, so how am I going to get referrals?” I’ll say it again. A referral is a lead that comes from someone that you know—period.
“Hi, Steve, this is Jim” (I have never done business with Steve, but he is a friend from my previous job). After a little bit of chatter, “Steve, is there possibly anyone you know that needs assistance? Yes, great. Can you make that intro for me? Yes, great.” Now I am talking with Adam through Steve. Adam and I talk. He is ready to sell his property in six months. Great. “Hey, Adam, I’ll send those comps tomorrow over e-mail. Also, just by chance, is there possibly anyone else you know that needs assistance? Yes, great. Would you mind making that intro for me? Yes, great, thank you, Adam.” Now I am talking to Susan through Adam. Now I have two warm referral leads to follow up with, Susan and Adam. I go back to Steve and say thank you very much and send him a $5 Starbucks card or write him a note. Steve is rich, but when is the last time someone gave him something tangible as a thank you? Now I have three “friendlies” in my hip pocket, two of whom are going to do business in the next six months.
Let me give you another example. I am at an open house and meet Glen and Stacey for the first time. We have a little chitter-chatter and then right then and there or later through e-mail or by phone, “Hey, Glen and Stacey, is there possibly anyone else that needs assistance? Yes, great.” Now I am talking with Carlos through Glen and Stacey. Which lead is more likely to close? Carlos or Glen and Stacey? Carlos. You got it! Why? Because Carlos is a warm referral lead and Glen and Stacey are a cold lead. “Hey, Jim, that’s not fair, you didn’t you really know Stacey and Glen.” Yes, I did, I knew them for five minutes. Remember, a referral is a lead that comes from someone you know—period. It’s a fine distinction and you’ll probably want to work Carlos like crazy and completely drop Glen and Stacey. One generates income and the other does not. One is a warm lead and one is a cold lead. One will successfully drive your life and business, and the other one will drive you out of the business.
I am telling you right here and right now, that is how I was able to do so much business so quickly both in loans and then when I switched to real estate brokerage. It’s one of those Key to the Kingdom type of concepts. If you can figure out another way to go from ground zero to the moon in one year, then that is fine. But the above is my recommendation nonetheless.
And finally, don’t get paralyzed by what to say or how to say it. Just be yourself, focus on the process as outlined above, modify it as you wish, understand where you are trying to go with the process, and be yourself. Don’t be a robot, people hate that. Be yourself and get after it.
Go get ’em!
Things may come to those who wait, but only the things left by those who hustle.
President Abraham Lincoln
The beginning is the most important part of the work.
Chapter 2 - The First Step
Three of the twenty chapters included in the section called GETTING STARTED.
This might be a good time to have a somewhat boring, but short-short conversation about terminology.
Real Estate Lending. Here are some loose terms that could define a person that is originating loans secured by a piece of real estate: loan agent, loan officer, mortgage broker, broker, mortgage lender, mortgage loan originator, agent, originator, producer, lender and more. Further, now that the giant brokerage houses have jumped into the game of real estate lending, the above list could be expanded to include wealth managers, vice president of investments, and many more. Don’t stumble over the terminology here. The bottom line: this is a human being that is originating a loan that is secured by real property. In the interest of keeping it simple, I have mostly referred to this person as either a lender or a producer.
Real Estate Sales. Here are just some of the terms that could loosely describe someone involved in real estate sales/brokerage: real estate agent, broker, broker associate, real estate broker, selling agent, listing agent, buyer’s agent, seller’s agent, procuring agent, property agent, producer, vice president and more. You may have noticed that I excluded the term, REALTOR®. The term is a trademark of the National Association of Realtors and should be used only to describe membership thereof. Again, in the interest of keeping it simple, for people involved in real estate sales, I will be referring to this group as either a real estate agent or a producer.
I’m glad that’s over! Let’s move-on to some things that will help you move down the road.
Here are some possible categories of real estate to consider: residential brokerage; residential lending; commercial lending; warehouse sales; warehouse leasing; office sales; office leasing; retail sales; retail leasing; manufacturing sales; manufacturing leasing; small unit apartment sales; medium unit apartment sales; large unit apartment sales; institutional apartment sales; small, medium, and large hotels and motels; farmland sales and leasing; gas station sales and leasing; storage facilities; churches; residential care facilities; medical buildings; hospitals; and garage/parking leasing and sales.
This list covers most of the large categories, but there are more. Here is an example of a piece of real estate that does not fit neatly into the above. Let’s assume that an abandoned rail station in a downtown metropolitan area needs to be sold. The property has complicated ownership rights going back over one hundred years, given the installation date of the American railway system. Undoubtedly there will be environmental issues to consider relevant to the ground, water, and possibly air. And, just to complicate things further, let’s assume the property was omitted (by accident) some years past from the general plan when the city moved that area to high-density housing. This is an example of specialty real estate: those projects and areas of real estate that are niche.
It may be prudent to note at this time that whenever a piece of real estate is traded, there is usually a real estate broker and mortgage broker involved in the deal. The property could be a $60,000 condominium in a suburb of Cincinnati or a $300 million office building in downtown San Francisco. In either case, real estate brokers and lenders are on hand to help facilitate the transaction and ultimately earn a fee upon the successful completion thereof.
Now, where to start? No one gave me this advice when I started out, and the following is probably some of the most valuable coaching I could have received, so I am a slightly passionate about sharing this information with you now. Do your homework! Spend a minimum of six months researching the categories and the industry at large. Read, read, read. Then talk, talk, talk—to everyone. You need to understand the intricacies of the categories before you can take that next step and decide on a category.
Okay, let me be more specific. The reading part is easy to figure out: books, Internet, whatever you can get your hands on. The talking part, however, is the magic. Reach out to professionals in all the different categories. For instance, I have a family friend that is literally one of the top apartment brokers in California. How many times has a person new to the industry reached out to him to chat? I asked him, and the answer was almost never. Why not? “Well, he is so busy and won’t have time for me.” Really? I will bet $100 that if you called him right this second, you could reach either him or his secretary and get on his calendar for lunch or coffee.
Don’t assume, big mistake. Some people actually have a passion for helping other people. Some people like talking about the industry or their own personal challenges and successes in those industries. There was a period of time when I was one of the larger producing lenders in Silicon Valley; same thing when I switched to residential brokerage. My phone number was not a secret; I didn’t have it hidden away in a vault so no one could get hold of me. I can literally count on my right hand how many times a young person new to the industry has reached out just to have coffee and learn about the industry. And those rare times that it did happen, I was literally tripping over myself to rearrange my schedule so that I could meet him or her. Hey, I enjoyed it.
Call the producers. We are all human and need to eat, so ask them to lunch or coffee. If they would rather meet in their office, then fine. Work within their schedule, but I suggest early morning or later in the afternoon. Busy people get busy as the day moves along, and you want to avoid them cancelling at the last minute. I call these meet and greets. Just explain that you are considering a career in real estate and trying to understand the different categories. Be honest. Phrase it however you feel comfortable. Everyone has time in his or her day and loves a break from the day-to-day grind. Do it!
Reach out to the producers, but don’t forget the support staff. They will have a different perspective and see the business through their own lens. You’ll be surprised how much you learn from the support staff. Remember, they are the ones dealing with the fifty or so agents in that office on a daily basis. They can more accurately paint the picture of the average producer. They are also the ones handling checks/income in most cases. You can talk with a producer and then talk with a support staff member (in the same office), and they will paint, in most cases, different and possibly even opposing pictures of the same industry. Have those conversations. You need to understand the good, bad, and ugly of each category.
Meet and greets with the managers should be a piece of cake; they will most likely turn the table and attempt to recruit you. Great, fine, no problem. Ask them questions, very probing and serious questions. You will naturally need to dance around a little when talking with the producers and support staff, for obvious reasons, but not the managers. This is your career (and your life at the moment), so come loaded with questions. Nothing should be off limits when talking with managers. When I started in real estate, I met with a few mortgage companies. I arrived at my first meeting one hour early and made a list of questions, twenty-eight in total. I used those twenty-eight questions in the remainder of my meetings. I suggest doing these meetings at managers’ offices. Try to take it all in: the lobby, front desk staff, the décor, maintenance of the office, how the agents treat each other, how the agents treat the support staff and vice versa, and, of course, those intangibles such as feel, rhythm, energy, synergy, etc.
We have all heard the terms B to B and B to C. Those terms are defined as doing business from business (B) to business (B); and business (B) to consumer (C). The real estate industry has B to B and B to C, and in some categories of real estate we have both. Why is that important to understand? Good question. What kind of customers do you want to work with? Do you want to work with mom-and-pop consumers dealing with their own personal business affairs? Or do you want to work with professional businesspeople that are typically employees of a company working nine to five? One of those options is a personal business transaction; the other is business—only business. If you want to work with consumers dealing with their personal business affairs, then residential lending or brokerage could be something to consider. If you say, “I only want to work with customers that are professional businesspeople acting on behalf of their company,” then you may want to consider being a tenant representative for a national chain or a corporate leasing expert representing a few technology companies. Have you thought of that? I hadn’t early in my career. The customer dynamics literally never crossed my mind when I was starting out in real estate. The only way to understand those intricacies is to get out and talk with people face to face. Meet and greet—a lot.
Don’t let any of the categories intimidate you. We don’t know it until we know it. Do something enough and you’ll learn it. I have an uncle in Southern California that had a successful career in industrial buildings. This was loosely defined for him as warehouse and manufacturing, both sales and leasing. For whatever reason, when he started in real estate in his late thirties, he focused on this area with a partner. He started slow, but he learned and became one of the power players in Orange County for a couple of decades. Whatever category of real estate you choose, don’t worry, you’ll learn it.
Research for six months; that’s twenty-six weeks. Do one meet and greet daily for six months; that’s 130. Can you imagine how strong you will be if you actually do the full 130? No one will be able to fool you; you will be muscle strong and razor sharp. Fully informed. You will know who’s on first and what’s on second. You will be bigger, stronger, and faster. You will understand every position in the field and the responsibilities thereof. You will know compensation details in each category and at each level of production in each category. You will have a better understanding of whether you should be a lone wolf or part of a team.
It will be brutal to switch categories at a later date. Take the time and do it right.
Go get ’em!
Chapter 20 - Your First Deal
When you are asked if you can do a job, tell 'em, "Certainly I can!" Then get busy and find out how to do it.
President Theodore Roosevelt