“Are you pre-approved?”
This is one of the worst questions a real estate agent can ask a prospect during the first conversation with them.
Imagine you’re on a date. The first time you meet somebody, and you ask the person sitting across from you at the table, “How much money do you make?”
That person’s probably going to get up and walk away.
Yet, this happens all the time in the real estate world. Real estate agents constantly ask this terrible question, “Are you pre-approved?”
The Right Way
There’s a better way to get the information you need to move forward with a potential buyer.
Ask, “Are you planning on paying cash, or do you want to finance it?”
This is a very different approach because you’re assuming this person could be a cash buyer, or maybe they need to finance the purchase. Now, keep in mind, you don’t want to ask this question during the first two or three minutes of your phone call—instead, hold off until your second or third appointment with them.
At that point, you can work these types of questions in and maybe even preface it with, “If we want to present an offer on this home, the sellers will want to make sure we can get financing. I’m sure that’s not an issue here. So are you planning on paying cash, or will you finance the purchase?”
Make it about getting the home. Not, this person will only be worth my time if they have a pre-approval. Because if you take the approach of the latter and ask that horrible question, (Are you pre-approved?), you’re going to lose business—no question about it.
Know Your Clients
Some agents need to know their price range to show houses to buyers. They might be scared to ask the clients if they are pre-approved because the agent might fear they will insult them. Then they end up showing houses totally out of the client’s price range, which is embarrassing for everyone.
Of course, no real estate agent wants to show several homes to buyers without knowing their financial situation. I’m not saying don’t qualify your buyers—that’s an important step to ensure you’re not wasting anyone’s time. But instead of rushing in demanding to know how much money they’ve got in the bank, take a step back, and start asking better questions.
“If you like the home, any seller will want to know how you plan on purchasing—cash or finance?”
Be mindful of what you say and communicate with clients like a professional. Just by tweaking your language, you will earn more business.
