Category: Technology

Is technology helping or hurting us?

Special Contributor Leave a comment

Chris A. Studebaker, CEO, REALTOR® Association of the Fox Valley, Inc.

What would we do without technology? We as association executives have been trying to push our members to embrace technology in all areas for a very long time. Lost your SentriKey card? Use the app to get into that property. Have a buyer from out of state to whom you want to show a property? Hop on your phone and give them a virtual tour. Can’t make your committee meeting because of a listing appointment? Join the meeting via Zoom. Don’t have the time or means to attend the NAR national convention? Watch it online! And during this lockdown period due to the pandemic, technology has literally saved our business. Where would we be without Zoom, without Facebook Live and FaceTime, without webinars, virtual closings and apps on our phones that help us do what we once did with our clients in person? Technology has helped real estate to adapt to our lockdown world and to not only carry on, but thrive!

But, I often wonder, as I sit typing this article on my computer while checking emails on my phone, and watching my teenage son spend hours on his phone “talking” to friends — “Is technology really helping us, or is it hurting us?” When I was his age, I was getting together with friends to cruise the main drag, play football or “hang out” at each other’s houses. We were having lengthy phone conversations — I wasn’t sending three-word texts back and forth, never seeing one another. And I may be dating myself, but I can remember days when you took your college final exams in large lecture halls and you interviewed for your first job in person. Those are obviously things of the past. Now, I realize that much of this “new-normal” behavior is due to the pandemic restrictions, but I can’t help but wonder, “Will we ever go back to the way it was?”

The lack of in-person communication has affected all of us. We are all face-down in our phones reading our short text messages instead of having heads-up conversations where we can see expression, body language, emotion, feelings. As an industry, we’ve replaced much of our in-person interaction with virtual. Many offices are looking to downsize their space needs because in-person office meetings and classes are becoming a thing of the past.

Even though I miss our face-to-face interactions, I, for one, can appreciate the “push” that the pandemic gave to all of us in the area of technology. It forced those who were not embracing technology to give it a big bear hug and set a place at their business “table” for it. I’m also impressed with how tech-savvy our membership has been forced to become. The number of calls we receive from people having technical difficulties has dramatically decreased. People are more patient with technology hiccups, and they’re more committed to working out the problem themselves. They realize that technology is here to stay, and they may as well get used to it. They say that there is a silver lining in every cloud… even in a pandemic. The positive nuances of the technological push may be COVID’s.

Everyone can also agree that Zoom calls, virtual tours, texting, online MLS — all of these advances in technology have made us incredibly efficient, way more accessible and save us enormous amounts of time. Our embrace of technology also helps us in our diversity, equity and inclusion efforts. Technology helps to make the homebuying process accessible and available to all people. Those who are physically challenged and cannot make an in-person listing appointment can now see their future home through the eyes of their Realtor giving them a virtual tour. Those who cannot take off work or get child care to meet with their Realtor to list their home can now do all that is necessary through email, text and electronic signatures. It has truly changed the rules of the game.

Technology is exciting, helpful, smart and slick. It makes all our lives easier and helps us all to strive to be better. And there are so many more advances to come. I am excited for what is on the horizon with technology. I guess what I’m trying to say is, I love the edge that technology is giving us in real estate by allowing us to work quicker, smarter and better. But at the same time, let’s all promise that we don’t totally lose our in-person connections. Because as Realtors, that’s what our business is all about… the people.

Becoming a Digital Earnest Money Addict

Anne Ewasko Leave a comment

For the past two decades — yes, decades — I have been using the traditional methods of checks and bank wires for sending and receiving earnest money. Most of us agents have been doing it this way since the beginning of time, as these were our only options. Checks are so time-consuming, with the runaround for “the handoff,” or the hassle for the office drop-off, or the chance of them getting lost or delayed in the mail — not to mention the time it takes to deposit them.

Wires made life a little bit easier, but it took time to explain to clients how to do them. Plus, the whole security issue of keeping the clients protected was always of concern. Then there was all the paper-pushing needed to provide receipts to show what was paid and by whom, and when it was received and by whom. It could turn into a real time killer and sometimes even a nightmare that could potentially jeopardize a transaction if there were delays.

Well, I am happy to say those days are over for me now. If you haven’t gone digital yet, you should really consider it. Digital earnest money deposits (EMDs) have been around for less than a year, and at first, I was reluctant to jump on board. Why? I am a security freak. There’s something that I am just not comfortable with in using an app for large banking transactions. And in this case, it’s not my money but my client’s! So an even bigger liability, and if I am not comfortable, how could I expect my clients to be, as well?

Then one day not too long ago, I was sitting at an inspection. The listing agent was sitting across from me in the living room while the inspector was doing his thing. We had just put the deal together the day before, and my buyers needed to get their initial earnest money in. So, she had mentioned that she just finished a companywide webinar that morning, as her firm was rolling out a new program for their agents to collect the earnest digitally. We both were newbies at it, so we decided to download the app on our phones and give it a whirl. It took her about five minutes to input the details of the transaction, and then she sent me the invitation. When I accepted it, all I needed to do was input my client’s information and hit “Send.” Within 10 minutes, the listing agent and I simultaneously received confirmation of payment (including receipt) that the earnest money was in — all while still sitting there in the living room! From start to finish, the request for the earnest money went out, was received and was documented all within 15 minutes! Voila! I was hooked.

Yes, it’s super easy and convenient, but was it safe? Remember, I’m a security freak, so I did a little digging and found out some interesting things that I would like to share. The digital app we used was Earnnest. There are other EMD apps out there, but I am going to focus on Earnnest. First of all, these are Automated Clearing House transfers (ACHs), not “wire transfers.” What is the difference? Both ACH payments and “wire transfers” electronically move money from one financial institution to another, but wire transfers are initiated and processed by banks, while ACH payments are processed automatically through a clearinghouse. Because of clearinghouse rules, ACH payments are often more secure than wire transfers.

So, why haven’t we used ACH payments in the past for earnest money deposits? Because there was no protection on reversals. One could do an ACH payment but could “claw” it back if they wanted to, and as this is going into an escrow account, that would be a big no-no — but almost impossible to prevent if the payee decided to reverse it. The app protects the payment from these reversals.

What about the security of my client’s personal and banking information? Who sees it? Where is it stored? How does it get protected? These were all serious concerns of mine, and it turns out that Earnnest is partnered with two companies that gave me some peace of mind. The first one is Plaid, a fintech company that connects banks to apps and allows for instant verification for use of those bank accounts. It’s the same system used by Venmo, Robinhood and many other apps. They currently have about 93% of all banks and credit unions in their system. The second one is Dwolla, the leading payment processor in the nation. Their role is to set up a secure connection between the payee and their bank using “tokenization,” a fancy banking term for the removal of all sensitive financial data from transactions. This includes multiple levels of encryption between Earnnest and the client’s bank information, bank account details or routing information, they cannot store it, share it or have it hacked — which was a relief to hear. The app itself is also protected by AES 256-bit encryption, the highest standard used by financial institutions, as it’s the most advanced and secure encryption algorithm.

With a sigh of relief, I’ve had my security concerns satisfied and am now comfortable providing my clients the ability to send earnest money digitally. It’s going to be a real game changer not only for me, but for my clients. Checks seem so archaic now, and while wiring is still an option, I have to say that most people haven’t had much experience with bank wires. But they have with banking apps, so using an EMD app isn’t too far of a stretch. Wire transfers are more costly and start around $30 and up, depending upon the amount, and the Earnnest app, which I use, charges the client a flat fee of $15 with a minimum transfer of $30, up to a maximum of $100,000. At the end of the day, it’s about being efficient and making life easier for my clients. More time means more money, and happier clients means more referrals.

Anne Ewasko is a veteran Realtor in the Chicago area and a longtime techie. Visit her at anne.luxhomechicago.com.

For more about real estate tech, check out AgentEDU’s course on the tech you need to manage a team.