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hello and welcome back to rev real estate school I'm your host Michael Montgomery and today we're talking about how to qualify leads but more specifically we're talking about should we even be qualifying leads and to what degree should we be qualifying leads because there's some different viewpoints on this now my viewpoint May differ slightly from yours but that being said hear us out here and see if this makes sense depending on where you're at in your business so to kick things off generally speaking agents tend to focus too much on lead qualification now there's a lot of caveats to this but generally speaking we tend to be very focused on qualifying a lead before we jump in the car before we start showings before we even start communicating with them and this in fact can be a disadvantage the reason why this can be a disadvantage is if we think about this as an individual we don't think about this as a lead we think about this as an individual it may change our perspective on how we want to approach this lead so for example let's say that I have somebody and I don't necessarily qualify them to the extent that I normally would so I go out and I do a number of showings and then after those showings we realize they can't buy maybe they don't have a pre-approval for financing they're not able to get a loan and so they end up not buying now there are two ways that I could look at this number one is I could look at this as an individual who didn't buy and who took my time or I can think about this individual as somebody who I spend time I invested time into in order to get them into my database now if we consider the latter and we consider the fact that we have now spent time built some rapport with somebody who's now in our database and this individual maybe in a year maybe in two years they are able to buy and over the period of time they also potentially refer other people to me was that really a bad use of my time in my opinion this was not a poor use of my time now this could stand on for say years and years of showings in which case maybe it would be but generally speaking if we're not qualifying the lead to the extent that we normally would yes we're going to end up doing a few more showings but we'll also get a few more deals and let me explain this so if we end up going out there and showing more properties than we typically would that means that we are going to be working with the odd unqualified lead however if we take the other side of the coin and we over qualify leads there's a good chance that we'll end up missing a few people because we're going to over qualify them they're going to end up going another direction or they'll end up eventually buying with somebody else now all of that being said there are arguments on both sides but there's also some psychology at play here now if we have gone through our buyer process and we've explained how we're compensated oftentimes when this person ends up not buying they tend to feel like they did use our time and they did use our time without us actually having anything at the end of the road and so they could oftentimes feel indebted to us now we don't want to make them feel indebted to us we want them to understand that it's perfectly fine and it's okay that we went out and viewed some properties and we didn't end up actually securing anything however human nature they will at times start to feel a little guilty and what they may say to you is how can I compensate you what could I do for you and I've had this many times where people have said I just went on a number of showings with you we didn't end up buying plans changed what can I do for you and my response to them is actually quite simple I'm not looking for any level of compensation all I ask them to do is just keep me in mind for their family and friends who are looking to buy or sell real estate and so out of this I have somebody who has now entered into my database somebody who will very likely Buy in the future and somebody who's in a position to refer more clients and so if I went out and did a number of showings in fact that's not necessarily a poor use of my time at all now all of that being said there are still some exceptions to the rule and really there's one rule of thumb that we can focus on here really we want to determine are we a newer agent who's trying to build our business or it doesn't even have to be new just somebody who's in growth mode or are we somebody who's an existing agent or somebody who's extremely busy and therefore doesn't have the time to dedicate to people who potentially aren't qualified so we have two groups of people here we have say the new agent in Grind Mode and we have the existing agent who doesn't have enough time now if you are in the mode where you really want to grow your business regardless of if you're new or not showing extra properties and potentially not qualifying to the same extent that you would previously is not the worst thing a if you're new you're going to get out there do more showings you're going to build rapport with this individual you're going to improve your skills but B even if you know how to show a home and you're in a great position you'll still be adding that person into your database now on the other side if you're extremely busy and you don't necessarily have the time for this then it's a disadvantage to all of your other clients if you're spending your time on people who are not qualified so understand where you are in your business and what your goals are and if your goals are to grow then you should be showing more properties versus over qualifying the lead so all of that being said what do we end up doing when it comes to qualification whether we want to kind of qualify them or fully qualify them there's one very important concept for us all to understand when we're qualifying somebody oftentimes in our own minds what we're thinking is I don't want to waste time on this individual now that is a mistake when we are approaching qualification from the mindset of how can this actually help us and not waste our time what is happening here is we're taking the focus away from how this is benefiting them so when it comes to qualification anytime we're qualifying we need to be putting this in terms of how it helps them and this is actually not too challenging in fact most of the qualification when we're talking about that we tend to be talking about financial qualification right we're talking about can they get approved for a loan do they have the down payment are they able to proceed we need to frame this in terms of how it's going to help them so if I'm talking about financing to a potential buyer and I'm qualifying them I'm not going to say are you pre-approved for a loan and then stop there instead I'm going to explain what a pre-approval is and how this helps them I'm going to say when you're pre-approved and we go to a hot listing that has a lot of offers on it the seller will very likely choose the offer from the most qualified buyer if we don't have a pre-approval and we're not able to actually showcase this then we could be at a disadvantage so by getting a pre-approval we're actually putting ourselves in a position to win in a multiple offer situation and if there's multiple offers there's a good chance that this is a really nice property that a lot of people want to buy so that's the benefit of a pre approval and then I will move into hey have you been pre-approved and if you haven't would you like me to introduce you to somebody so we're talking about subtle shifts here we're talking about subtle shifts in our thinking and subtle shifts in the way that we discuss pre-approvals in the way that we discuss qualification with clients but we do need to understand that if we are qualifying we're not qualifying for our own purposes yes there's an element to that however we need to be framing this in terms of how it helps them and it's true that having that pre-approval of course does help the client so be very mindful of the words that we're selecting when we're going through this process because if we're not cautious and I say hey I need to know if you're pre-approved before you get in my car because my time is valuable that is all about me and that buyer is going to go the other direction in fact if I'm your buyer I'm going the other direction because all I know right now is you care about yourself you don't necessarily care about my needs and so how we frame this is important thank you very much for watching or listening to step episode if you have any questions feel free to reach out anytime at revrealestateschool.com or I'm on Instagram at the dot michael.montgomery thanks again and we'll see you in the next lesson