By Jesse Wood, CEO of eFileCabinet
The real estate industry currently faces many unique challenges, according to a recent National Association of REALTORS® report. However, many of these concerns can be addressed with document management software (DMS) and improved business process management.
According to NAR, one challenge is the lack of streamlined education and training available to agents. The typical U.S. commission of 6 percent that real estate agents charge is also under attack, because that's high compared fees charged in other countries. In response, real estate agencies now have to compete against brokers and agents who are exploring new, lower percentage business models. And, last but not least, most real estate agencies face compliance issues with federal regulatory policies.
All of these issues can be drastically simplified and streamlined by using DMS:
Education and Training of Real Estate Agents
Becoming a real estate agent can be a quick career path if you're focused. In most states, it takes 70 hours of training to receive a real estate license. Consequently, some real estate agents don’t know enough about the business they’re in when they first receive their license.
While your agency can’t change the education requirements on the state level, you can certainly ensure that your employees have the information and tools they need to succeed at their job. First, you can institute additional employee training where established agents show new agents best practices. Second, you can use DMS to ensure that agents can easily locate the information they’re looking for.
Use Workflows and Templates to Streamline Processes
Real estate agents have to take care of a lot of paperwork when listing, showing or selling a particular property. Fortunately, you can use workflows to streamline each process and make sure that nothing gets forgotten. You can also use templates to help agents create the paperwork they need. For example, your agent may need to ask the seller to perform upgrades or repairs found necessary during the home inspection. Your template can make it easier for your agent to draw up a legal document that leaves nothing out.
Explore New Business and Pricing Models
Your agency may be interested in exploring new business and pricing models that allow consumers to save money while still keeping your agency running. When you use DMS for your business process management, it can be easier to find where you can cut operational expenses without limiting the quality of interactions between your organization and your customers.
One of the things you can do to lower your expenses is to move towards becoming a paperless organization. It can be challenging for the real estate industry to reduce paperwork, but contracts and agreements are legally binding in electronic form as well.
Your agency may decide to offer services separately to its customers. For example, your customers may decide to pay for listing their property, reviewing or drafting a purchase contract, or researching a deed. You can even offer a hybrid of old and new ways, where you’ll still use the commission-based model for buyers and sellers who prefer to do it that way.
One of the advantages of not tying your earnings to a commission percentage is that your real estate agents won’t feel obligated to show only higher priced listings. This will in turn draw customers to your agency.
Compliance With Regulatory Policies
Brokerages have to comply with many regulatory policies. Some agencies are in violation of the Consumer Financial Protection Bureau’s anti-kickback and referral-fee rules governing brokers’ financial arrangements with title companies, lenders, and others. But in the “DANGER” report commissioned by the National Association of REALTORS®, it becomes apparent that most brokerage companies are either ignorant of this fact or believe mistakenly that they’re in compliance. That’s a huge concern for the industry.
The good news is that DMS can help your organization streamline its operations which will make it easier to become compliant with all of the applicable policies. At the same time, DMS can keep your documents safe and secure and prevent unauthorized access.
Streamline Operations With Document Management Software
REALTORS® and title companies can greatly benefit from streamlining their operations with DMS; your agents will no longer spend hours looking for documents, you can streamline your processes and ensure that no step is forgotten by utilizing workflows and templates.
Jesse Wood is the CEO of Utah-based eFileCabinet, Inc., an electronic document management solution designed to help organizations capture and protect data.