SKATING ON THIN ICE BY RECOMMENDING CONVEYANCERS THAT OFFER REFERRAL FEES.
ARE YOU AN AGENT 🏘️ OR BROKER 💰?
You could, or worse your clients could, be skating on thin ice by recommending conveyancers that offer referral fees.
This post was triggered by a recent experience where we were approached by an agent that asked us how much we would be willing to pay them to refer their clients to us. Unfortunately, this is by far not the first time we have been asked this.
Unlike some other property related fields, the margin on a single conveyancing transaction is quite tight and once you have taken into account operational costs, what is left must be split over:
1. COST OF DELIVERING THE SERVICE
This is the amount of time dedicated to a client and the quality and competency of the staff that are employed to deliver the service; and
2. COST OF ACQUISITION
This is the amount spent on marketing and, specifically related to this article, whether or not a conveyancing firm spends money on referral fees.
Some conveyancers rely on securing jobs by offering referral fees per matter to agents and brokers. On the face of it, that may be highly attractive, however this fee will often come at a cost to a client, by way of:
1. INCREASING THE CLIENT’S FEES TO PAY FOR THE REFERRAL FEE
This will not necessarily be shown in the advertised professional fees, but can sometimes be hidden in additional charges that will be added in the course of the transaction; and
2. REDUCING THE CLIENT’S STANDARD OF SERVICE
This will normally be achieved by not having qualified staff assigned to manage the matter and/or restricting the ability of a client to contact the firm to discuss any issues they may have. The end result can be catastrophic for clients in having an inexperienced person managing one of the biggest transactions of their life, not to mention the deal may be lost.
Here at MAP Lawyers, we do not accept or give referral fees for giving or receiving matters. Irrespective of our professional and ethical obligations, we are motivated by building a long-term solution where we provide an exceptional level of service for our clients and partners, and in turn, they will recommend their friends and family going forward.
WHY REFER TO MAP LAWYERS?
Plain and simple – we do a good job and will look after your clients. We are specialists in residential property and distinguish ourselves from others by:
- All matters are handled from A-Z by a qualified solicitor
- We provide a higher level of service and communication for our clients, agents and brokers we work with
- We offer fixed fee and transparent pricing (view our website www.maplawyers.com.au for a property specific online quote)
- We offer a free standard pre-signing contract review service (turned around in generally 2 hours but certainly within half a day)
- We pride ourselves on having over 300, 5-star Google reviews; and
- We are a referral-based business – we are not interested in referral fees or kickbacks, but rather are motivated by providing an exceptional standard of service for your clients so they will be happy to refer their friends and family.
