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What does a Referral Agent do?

Nicole Madison
Updated Mar 03, 2024
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A referral agent is a person who makes money by referring customers or clients to a business or individual who can meet their needs. For example, a person who sells mobile homes may want to secure more prospects interested in buying mobile homes. One of the ways he might accomplish this is by working with an agent who refers prospects to him for a fee. In some cases, a referral agent may receive a fee for every reasonable prospect he refers, while others may receive compensation each time the recipient of the referrals makes a sale.

The duties of a referral agent may vary, but for many, the primary focus of the job is to generate leads. This means they spend time looking for individuals who are interested in a particular service or product and referring them to businesses or individuals who can fulfill their needs. For example, some agents work in the real estate field, referring potential real estate purchasers to agents who are ready to help them.

Often, a major part of a referral agent’s job is not only generating leads, but also finding people who not only are enthusiastic about purchasing property, goods, and services, but also are qualified to do so. For example, if the agent takes on an assignment of generating leads for an adult-only community, he may screen individuals to make sure they meet the criteria for living in the community. Likewise, he may want to make sure the leads he generates consist of people who are interested in adult-only communities and possess the financial ability to buy or rent property there.

The manner in which a referral agent makes his money may vary from agent to agent. Some may be paid for each lead they generate, while others may have to refer a minimum number of people to earn payment. Sometimes generating quality leads is enough to earn payment, while others may have to generate leads that end in sales to earn money. Additionally, there are some agents who aren't paid according to generated leads at all. These people may be paid on an hourly basis or even receive salaries.

The requirements for becoming a referral agent may vary, depending on how a person plans to work. A person who starts a referral business may not need any particular education or experience, but sales ability may help. Some companies that hire agents of this kind may prefer individuals with college degrees and sales backgrounds. Additionally, some jurisdictions require real estate referral agents to have real estate licenses.

Practical Adult Insights is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Nicole Madison
By Nicole Madison , Writer
Nicole Madison's love for learning inspires her work as a Practical Adult Insights writer, where she focuses on topics like homeschooling, parenting, health, science, and business. Her passion for knowledge is evident in the well-researched and informative articles she authors. As a mother of four, Nicole balances work with quality family time activities such as reading, camping, and beach trips.

Discussion Comments

By Reminiscence — On Jan 21, 2014

@pollick, I don't think it would be a good idea to rely strictly on a referral agent for generating sales, though. You'd probably be better off hiring your own sales staff first, and then using a referral agent when leads start getting a little slow. Those fees could start adding up after a while.

By pollick — On Jan 21, 2014

I think if I were in real estate or housing sales or some other big ticket field, the first person I would hire would be a referral agent. The thought of cold calling potential customers would bother me too much, but a referral agent probably does that sort of thing all the time. He or she would also know a lot more people who have that kind of disposable income. As long as the referral fee was reasonable, I'd rather have someone else shaking the trees for new customers. I know that sound a little lazy, but some people are just better at things like sales and networking.

Nicole Madison

Nicole Madison


Nicole Madison's love for learning inspires her work as a Practical Adult Insights writer, where she focuses on topics...
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