After 21 years in the discounted mortgage business, I still find real estate agents to be the best source of paper available. Knowing how to deal with them and create long term. Profitable relationships is critical. One of the best ways to do this is through teaching them at their offices or in “Continuing Education” classes.
What Is Continuing Education?
In most areas of the country, real estate agents and brokers are required to obtain continuing education credits to renew or maintain an active real estate license. These state approved real estate and financing oriented courses can be a great opportunity for you to turbo-charge your note business. You can rapidly “Re-Position” yourself in the eyes of your customers and “Re-Position” your business in relation to your competition. Setting up a continuing education course for agents can be one of the most valuable, profitable marketing steps you take for your note business.
For example, Utah requires 12 hours of continuing education every 2 years. The course must be state approved and three of the twelve hours must consist of the “Core course” that the state designs. The other nine hours are at the option of the agent. If your course is attractive in offering them valuable knowledge and skills, you get the business. The competition can look very bleak and boring, so it won’t be hard. Many agents dread the continuing education because it is un-exciting.
What Are the Benefits?
There are three major benefits for teaching the course. Some may be obvious, but others are based on very important psychological principles that you might not have thought about.
Networking and Referrals – Real estate agents will always be one of the most important sources of paper that you will ever find. Not every agent knows or is in any way involved in seller financing. Some only run into paper once in a while and may call you in two months or two years. You need to network with as many agents as possible. The better you know them and the more agents you meet, the bigger your business and profits. It’s that simple.
Education Fees – You may find some profit in the fees you charge for the education. To be competitive with other continuing education courses, your fees may be as little as $10 per credit hour per person. I view the fees as a minor part and will even teach the course free for the short and long term business I’ll receive.
Positioning – Positioning is the concept of “the place you hold in someone’s mind.” The classic book by that title should be required reading for anyone in marketing (and is in many college courses.) Educators and writers are respected above their peers and competition. If you (or your company) are the one teaching the courses and educating the agents, they form a higher opinion of your knowledge and capabilities than of your competitor. You also clearly establish yourself in their mind that when they have a deal, they bring it to you because of the personal relationship they feel. It works powerfully.
What Should I Teach?
The two primary forms of human motivation are to gain pleasure and avoid pain. Greed and need are also used as a description. Most agents take continuing education because they have to and will choose the courses based on the above factors. If you can show them that they will make more money or avoid liability by taking your course, then you have an attractive draw in an area of some very boring courses.
Here Are Some Examples of Courses to Teach.
Safer Seller Financing – This is the basic course and can look a variety of ways. In Utah, I use this to explain the state’s “Seller Financing Addendum to the Real Estate Purchase Contract” that is a required form for agents to use. I then introduce them to our “Seller Financing Essentials” program that puts together a full loan package when a seller uses private financing.
Alternative Financing Tools – I put together a package and course I provide for Realtors that includes the “Alternative Financing Toolkit” that shows agents ways to structure deals and the many options available to save or more properly structure their transactions. This is a book and newsletter I designed especially for agents.
Navigating the Mortgage Maze – In this course agents can be shown the many types of mortgages and financing available with an emphasis on private financing and non-conforming loans. This course includes an overview of Conventional, FHA, VA, Community Home Buyers and local government programs including special programs such as H.I.P. loans, grants and weatherization programs.
Financial Calculator Gymnastics – Basic and advanced principles of financial calculators, including an introduction to the “time value of money.” This can be geared to a specific calculator like the HP12C or HP10B, but I like to teach a generic course based around my book “Discounting as Easy as 1,2,3.”
Understanding IRC 1031 Tax-Deferred Exchanges – This is a much more technical course, but can lead to many referrals and good contacts. Paper created in installment sales can be a tremendous tax savings and can be mentioned and highlighted as an additional alternative to 1031 exchanges.
How do I Teach It?
Gaining the Knowledge – Learn the material as well as you can. Follow an outline and know your outline, don’t deviate from the topics if you are at all unsure of yourself. Focus on and learn the particular subject, but above all, realize that you probably know more now about this subject than almost any real estate agent or broker you will run into.
Gaining the Skills – Many people would rather skydive or bungee jump than speak in public. It has been rated as the number one fear. Practice and confidence are the keys. There are several organizations available to help. Dale Carnegie courses teach you public speaking. Toastmasters clubs give you practice and feedback in a supportive environment. Always remember: Mirrors and minors. Many public speakers gained their skills practicing in front of a mirror or speaking to children.
Gaining the Guts
The confidence and power needed can best come from some of the Personal Effectiveness Trainings available. My most valuable tool in business and life is what I have learned in some of these types of trainings. That is why I encourage them to all and make some of this material a part of all of the two and five day trainings I give in the mortgage business.
How Should I Market My Course?
Self Marketing – You can market your course through advertising in Realtor publications, through mailings to brokers and through the state (if they publish a listing of approved courses). Develop a brochure or flyer and deliver it to brokerages or ask to give a five minute pre-view of the course at their sales meetings.
Larger Brokerages – Many of the larger brokerages in your areas may provide continuing education to their agents or even have their own schools or programs. You could even offer it to them for free or a modest fee just for the business.
Real Estate Schools – You can joint venture with some of the schools or even teach the course for free or low price and let them do the marketing. Remember, your goal is the business not a few hundred dollars in teaching fees. Once they are known, they have a built in clientele that comes back year after year for education.
Universities and Colleges – This works much the same as the real estate schools.
How Do I Get Approved?
In most areas, you will need to have the course and curriculum approved by the state. They may ask for copies of the advertising, attendance tracking procedures, materials to be provided, fee structure, policies and guarantees. Most will also want to approve or certify you as an instructor. Some may want to have the course taught at an approved school also. Follow their forms and instructions carefully. You may never find a more picky, meticulous group of people. This may be a good enough reason in itself to joint venture with a real estate school since they are used to dealing with this form of evolutionary offshoot.
For example, in Utah, I had to break the course down into 15 minute segments and stress the learning objectives and skills the student would gain. To be approved as an instructor, I documented almost 20 years experience as an agent and broker as well as providing a college transcript of my finance degree. They also needed feedback forms from students for which I used letters from students and comment forms from my discounted paper seminars.
If you joint ventured with a real estate school, they could help in all of these areas, even in getting you (or an associate) approved as an instructor. You’ll find the benefits well worth all of the efforts. If you want to totally “own and control” your local discounted mortgage marketplace, this is the way to do it.