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Red Flags When Interviewing a Real Estate Consultant

It's likely a consultant will be on good behavior, saying all the right things during your initial interview. But as you would with any other potential business arrangement, keep your eyes and ears open for red flags that could alert you to potential roadblocks ahead:

• The fees quoted are not only reasonable, they're markedly cheaper than other quotes you've received. Extremely low fees can indicate a lack of business on the part of the consultant and/or that once volume picks up, your consulting engagement may lack the priority it needs for completion.

• The consultant says that a verbal agreement and a hand-shake is good enough for him/her. Not only does real estate licensing law require the agreement to be in writing, it's good business to do so. A written agreement should be a minimum requirement when working with a consultant.

• The consultant asks if there is any reason you wouldn't want to work with someone on her staff to which he/she would assign you? This may indicate that once you're under contract, a junior staff member or level one assistant may actually handle your consulting assignment. Before agreeing to this, clarify why it would be done and the impact it would have on your working arrangement with the consultant.

• You're quoted a range of fees, but no caps/maximums are provided. If items (like caps) are missing in the agreement to consult, assume that they do not exist. Be definite in limits for fees, expenses, and time frames in each contract.

• The consulting agreement you need to sign is not available. In lieu, the consultant says he'll get your signature on the paperwork at a later date. Never proceed into a con¬sulting arrangement without first reviewing and signing the entire agreement to consult form. Without it, you have few protections as a consumer.

• The consultant asks for your consent to refer you to an-other service provider if the need should arise, but gives you no indication of why that might occur. While it's fine for the consultant to obtain your approval to refer you to another service provider; the consultant should be able to clarify why this might happen given your individual circumstance. Just as a Web link might take you to an ancillary Web page outside of the primary site, make sure you know in advance why the outside referral could be necessary and place those conditions in the agreement to consult.

Knowing the red flags to look out for when contracting with a fee-for-service consultant can keep you on the straight and narrow path to achieving your ideal results.

 



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