Real estate transactions can be fraught with risk.
By following these eight simple steps, you can significantly reduce your liability, manage the risk of potential litigation and make your clients happier.
- Review fair housing rules and treat all prospects, customers and clients honestly, fairly and equally.
- Keep meticulous records of all communication throughout your transaction. If you are using a paperless transaction management system, scan and upload all of your notes, emails and correspondence for your transactions.
- Use email to confirm any verbal conversations or agreements. Also use email as proof of delivery copies of contracts and addenda. If your clients don’t use email, mail copies of all the contracts and documents they sign via certified or registered mail.
- Practice the rule of three: always recommend at least THREE vendors when suggesting service providers. This includes contractors, attorneys, lenders, home inspectors, home warranty companies, and moving companies.
- Always encourage your clients to obtain a home inspection and a PARScore (if they are purchasing a condominium or unit in a HOA). Get a written waiver should the buyer choose to pass on conducting their due diligence.
- Educate and set the proper expectations with your clients and customers.
- Always conduct a qualification interview with all clients at first contact.
- Explain the entire sales process from beginning to end.
- Review how earnest money is handled and what happens if a sale is canceled.
- Explain how association-governed communities work–and suggest a PARScore to assess the health of the project.
- Be organized. Use a checklist to stay on top of all the tasks in a real estate transaction. Include any due diligence and contingency deadlines.
- Communicate. Communicate. Communicate. Do it often and with all parties involved in the transaction! Return phone calls and emails promptly. And always make sure to follow up after the sale. Happy clients are the best source of future referrals.
Do you have any other tips for managing risk? Let us know! Email us at info@associationevaluation.com. We love hearing from you!