Recently a friend asked me about the way in which vendors are selected when people buy and sell homes. In some cases, Silicon Valley home buyers or home sellers know which title company, home inspector, home warranty provider or other vendor to hire. Most of the time, though, they don’t. They are hoping that we real estate professionals can put them into contact with good providers to ease the task of choosing vendors.
When working with my clients, for most vendors I provide a trusted list of sorts. For the various inspections (roof, chimney, home, pest, etc.) or other service (lender, home warranty, title company) there might be as few as two or as many as six resources listed. Most often, my clients ask me if I have one or more which I prefer, and most of the time it is one company for each category (I have a favorite termite company, favorite home warranty company, etc.).
The home buyer or seller in Santa Clara can pick or hire anyone or any company he or she pleases for these various jobs. We agents can and will assist with sharing the names and numbers of those whom we know, like and trust, but at the end of the day, it’s the client who chooses. So really it’s up to the client – he or she can do some research or not. But if they tell me (as they most often do) to go with my preferred vendor, there’s one in each category and I don’t tend to “spread the business around”. Over the years, agents tend to build relationships with people in these companies and get a sense of whom they can trust and want to work with. (We agents would hate it if a client with six homes to sell picked six different Realtors to rotate through, too. We tend to want and also to give loyalty.)
My expanded list of trusted vendors also tells my buyer clients that if the seller has done a pre-sale inspection and the company is “on the list”, I do trust them to have been honest and it’s probably ok to have that company do the work. Sometimes they want a second opinion, which I totally understand and support, but an honest termite company will give the same report and information no matter who has ordered the report.
The Red Flags When Choosing Vendors
If the seller’s done a pre-sale inspection and the company is an out-of-area firm that no one ever heard of (I have seen that with bank owned properties where they bring a termite guy in from Stockton, for instance), then I will usually suggest that my buyer hire someone who’s a known entity rather than assume that the provider picked by the seller is OK. There are a few companies which I truly don’t trust, and if the pre-sale inspection is from one of them, I will ardently work to get my clients to hire better vendors.
(This happened a couple of years ago when my buyers were purchasing a Cambrian Park home where the pre-sale inspections were from companies with horrible reputations. We hired all new inspectors and found $10,000 worth of items missed by the “bad inspectors” – all very visible to anyone who had actually gone into the crawl space.)
Finally, I would never hire or suggest hiring based on either speed of response or price alone. Sometimes the very best in the category is someone who’s busy, and the one who can respond fast (or is cheapest) may not be as good. For me the more important thing is whether the vendor is knowledgeable, ethical, diligent and fairly priced (not over pricing). Sometimes the cheapest vendors cost more in the long run if they miss a problem or won’t jump through hoops when we really need them to do so.
Have a Good Vendor Relationship
The best vendors will go the extra mile for me (us) because they know they’ll have my loyalty and they want to earn repeat business or endorsement.
For an escrow officer, sometimes that means working late, accommodating a sign off after hours or doing other things that no one can really expect them to do (because they “close at 5”). For a home inspector, it may mean squeezing us in late in the day or even on a Saturday if there’s some true emergency. If vendors know that you’re only there one time out of five or ten, they won’t feel the loyalty that might urge them to try a little harder. The relationships built between agents and vendors can truly help consumers when there’s a pinch, especially. Those things cannot always be easily measured, but they can be vital to performing or closing on time and in the long run make transactions easier, smoother, and put the consumer in a better position overall.
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