I just spent the last week with my “mastermind” team, or my network of people that help me grow our business. And while I was there, I lot of questions came up about referrals, partners, etc. Now, this wasn’t a “real estate” group per se, but we definitely share our resources.

On the plane home, I got to thinking about networking in real estate. There aren’t as many mastermind groups out there. Plus, the cost to enter can be out of reach for many (this one cost me $16,000). So, I thought that since we’re just getting going into 2008, now would be a great time to evaluate our businesses and who’s on our team. So, I decided to post this article..

Here’s a short list of people that you need in your real estate business:

… Accountants
… Attorneys
… Private Lenders
… Rehab Lenders
… Property Managers
… Appraisers
… Mortgage Brokers
… Contractors
 
… Handymen
… Realtors
… Title Companies

The next question is naturally, “Great, well where do I actually FIND these people?” And the truth is “it depends”. For instance, my accountant can work with people virtually anywhere. I’ve referred him to our students all over the country and even outside of the country. But, as for contractors, handymen, appraisers, etc., you need someone local to where you are. So, how do you go about finding these people?

You can attend your local REIA groups. You can visit real estate brokerages or mortgage companies. You can attend tradeshows and industry events.

The best way, no matter what, is through referrals.

Now, keep in mind… as far as referrals go, you won’t always get the “cheapest” resource, but you’ll usually get quality. For instance, our attorneys may not be inexpensive, but they are efficient. So, in reality, in the long run, you’ll probably wind up saving a bundle. Plus, you know you’ve got a reputable attorney in your court. You’ll want to go ahead and make sure that you have at least 2-3 “partners” in each category. This way, you’ll never be 100% dependent on any one person or company. Plus, you can always get a second opinion when the need arises.

I also recently came across a “networking” site online… It’s called Money 4 Investors. They actually a directory of people across the country that understand – and want to work with – investors. This is really a win/win because if you’ve ever tried to work with a Realtor or an accountant, for example, that doesn’t understand our business, then you know how “challenging” it can be. You just put in your location and you get people local to you! They have people you can flip our deals to, note buyers, wholesalers, lenders, people looking to partner, etc.

 This site updates their directory with active team members all across the country regularly.

Whether you’re starting from scratch or re-evaluating your existing business, here are some simple tips to successful real estate team building.

1. Determine who you need on your team?
   Take a few moments to list all of the types of advisors, mentors, and educators you will need to reach your goals. These are people that are achieving what you want to achieve and/or have specialized knowledge in something that you do not, such as tax planning or asset protection.
   
2. Find out who is on your team now?
   The people that surround you – family, friends, advisors and mentors – will have a huge influence on your future path. Whether you like it or not, you have a team around you already. These are the people that are giving you advice, and perhaps you are still following the advice from people in your past.You want to examine closely every person that is influencing your business and financial decisions. Is your poor brother-in-law giving you advice on successful Real Estate investing? Determine who your positive influences are.
   
3. Create a prospective list of team members
   Put together a list of possible additions to your team. Come up with a minimum of three people for every category from which you will need expertise. Whenever you find one, ask them for a referral of someone else. Networking is the key to this business. Assess your prospective team membersMake sure that these people have both the experience and the credentials to properly support you. You are going to begin (like it or not) to relinquish some of your control to professionals and rely more and more on others experience. Make sure they have the ability to help you!
4. Learn how to work with your team members
   As you work with new people, you will likely find that they have different ways of doing things than you are typically used to. Just as it is important to find an adviser that fits your needs, it is equally important to make sure that you are the type of client that he/she can work with to produce optimal results.Always leave your interviews or meetings with an understanding of what you can do to be their “perfect” customer. Keeping those things in mind will help your business run smoothly. Build your team Start putting the pieces together, and building your team. You will also want to make sure that certain members of your team can work with one another as well. For example, you will want your mortgage broker to have, or be able to develop, a good working relationship with your title company.

The team should care about your results and have some level of vested interest in your progress. Handling the unexpected Even though you are building a solid foundation, you are certain to have unexpected results from time to time. One of the keys to your success is learning to solve problems and handle unintended events. You must have contingencies lined up and you must also keep in mind that business is business and friendship is friendship.

If something is not working, you must change it. If you cannot change it, then you must be willing to move on.

General Questions/Checklist:
For each person you are thinking of adding to your team, ask the following questions (Some team members may have additional specialized questions.):

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• Experience

1. How much experience do they have in delivering the results you are seeking?
2. What experience do they have with specific issues you will have?
3. What is the average income and experience of their clientele (Is this your goal?)
4. Do they personally have experience in your business?
5. Are they at an income level similar to where you want to be?

 

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• Education

1. Do they have the educational requirements for the job?
2. Do the have the professional credentials for this role?

• Compensation

1. How are they compensated?
2. Do they have a vested interest in helping you succeed?

• Client Contact

1. How do they keep in contact with their clients?
2. Is their response time comfortable for you?

• Your Needs

1. What can this person do to help you meet your goals?
2. Are you looking for someone to model?
3. Do you expect to be educated by this person?
4. If yes to No. 2 or No.3, how would this person do this?

Use these ideas as a guide and be sure to add any specific questions you may have as well. Remember, you are building your business and giving THEM the OPPORTUNITY to earn your business.

Be forwarned, it may be appealing to shop based solely on “cost” in the beginning, but know this… You WILL get what you pay for when it comes to professional services. A “cheap” accountant may cost you thousands in taxes. A “cheap” corporate attorney may cost you tens of thousands of dollars in legal fees if something he/she overlooked goes wrong. You get the point! ;-).