Over the weekend it was brought to my attention how a major REO broker seems to have an internal policy of putting REO listings in "Contingent" status as soon as they print the MLS printout to upload to RES.NET even though they don't have an executed contract. Had suspected as much but had not seen proof of it until recently. That is an unethical and probably illegal game some broker's play. Not only is it not fair to buyers agents and their clients but it may also limit the sales price the financial institution might receive for their assets. Has anyone else experienced that in their market and what have they done to curve such activity?
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It would be nice if there was a software on some website, which buyer's agent can input once they have an offer contract in their hand. The Asset Managers can see what may come through the system, and the listing agent can put a hidden comment about the offer. When I say "May come through the system", I understand some Asset Manager preferred only the top 3 to decide. It is up to the Asset Manager to ask, if they want to see a particular offer. ... This is just an idea. Input would be as follow:
- Offer Price
- Initial check for deposit
- Down payment
- Type of financing
- Close of Escrow
- Is it an AS-IS?
- Is there any contingencies?
- Will there be an inspection(s)?
- Buyer's name(s)
- Buyer's Agent Name and contact number
- And any other information that the Asset Manager want to know about
Oh Carlos......you hit a nerve on this one. Um, let me just say....YEAH!
I won't give her name, because I know she does a few (like 100+ a year) with Citibank however, not only does she "pocket" them, she refuses to send higher and better offers in to the bank before she has heard from her investor....who, happens to be related through marriage to her and, gives her a kick back. YIKES!
This is a problem but, it seems to be more of a problem with the "power" REO brokers than us little not so "powerful" REO brokers. The only reason I know this is happening with her is because, one of the members of the netwroking group she is a member of, which will also go un-nammed, told me that he bought a local investment property from and she told him she would "hold" the property for him or until she heard from him. It so happened that an investor of mine put, an offer on that same property, and didn't get it. It wasn't till later that I found all this out in a casual conversation about this agent I was having with that member of her networking group. The power of Networking....lol
Us Realtors got to be careful here, let alone all the ethics and legal violations.....it can kill your reputation if you get known as a cheater in this industry.....it will kill your business.
George Bellino > Jesus (Jesse) GonzalezSeptember 4, 2009 at 2:42pm
I agree it's more the big dogs than the small ones. Some of my investors call me and ask me to place their offers because nobody will get back to them. I don't know about everybody else but a buyer calling on any of my listings always gets called back within an hour if I miss their call. I do whatever possible (legally) to double end my own listings. In my market kickbacks to the listing agent is very common.
Carlos, it is sad but true. In my market the agent lists the property (sends to AM) then puts it on "temp" status so it is off the market. When you call to view, sorry the clean-out is not done, can't be shown. Then suddenly status goes from temp to Deposit. When sold the DOM will show the total, our system does not account for temp days off. They're always finding ways to beat the system including telling buyers "If you want to buy one of my listings, you HAVE to work with me" All of these things are hard to prove.
It is true, Fannie Mae, as part of the neighborhood stabilization act will look at only owner occupant offers for the first 15 days a property is on the market. They are aware of the investors buying everything up, and the 1st time buyers and others who might be willing to pay more are getting pushed aside because they don't have the cash. This is similar to what HUD dose for all their homes www.pemco.com i belive is the website. Agents still should send your offer in, however this is the case. I got notification a few weeks ago. ( As you may or may not know, Fannie Mae is expemt from many local state contractual obligations, such as escrow, title, city and county transfer taxes, so it wouldn't suprise me if this new practice falls within the same guidelines.)
Steve Adkins > JonathanSeptember 4, 2009 at 3:44pm
I like the idea of a set time period preference for owner occupant deals over investors. It gives the average home buyer time to take advantage of the deals out there. Then if no one takes the deal, open it up to everyone!
In my market this is common practice. On top of giving all their buyers the listings, they also get paid by the buyer for their service. This is not new and is almost an accepted evil. Even the smart buyers know. I had one buyer, who owns over 100 properties, call my about a property that was another agents in my office but they said they only wanted to deal with the listing agent because they knew that otherwise they didn't really stand a chance at getting it But as an agent I don't have the time to take this fight on. In my experience this is common practice for most of the bigger brokers. Myself, I have been offered cash on more than several occasions. Maybe it's because i'm fairly new and I don't want to risk any future business that I always turn them down. One thing that i'm guilty of is that I will try and find my own buyer during the pre-list stage but that buyer still has to be the highest or strongest offer. I really don't see anything wrong with that and I think that's the advantage you have as being the listing agent. I fell into REO's by luck but it was extremely hard work that got me up to 40 listings in a year. We have too much potential going forward to risk losing it all for a few extra dollars on one deal. I just really don't see a way to stop this from going on. WHo has the time and resources to end it? I would think only the banks do but they won't.
This is happening alot and I experience it every day in the field. Here is another new issue I have come across, Fannie Mae agents will not present an offer from an investor for 15 days from the date of listing. I was told it is a new law, but have yet been able to verify that law. I am an Agent for REO World and get very frustrated with the unethical practices that I see happening every day.
I will do my best to make a difference to curve this unethical and unfair business practice. Agents can make a difference by bringing up the issue to their local associations. It's not right for agents who pay their dues and association fees to be excluded from having an opportunity for their clients to buy one of those properties.
Susan BeVille > Carlos H. Silva Sr.September 27, 2009 at 11:00am
I totally agree. I had an agent in my area make a comment to another agent in my office on a property that was pre listed.....he said there would be multiple offers on it and he would decide what offers would get submitted to the bank!! We have a slew of complaints at our local association on some of the REO agents practices. Thankfully, none of those complaints are about me!!
Replies
It would be nice if there was a software on some website, which buyer's agent can input once they have an offer contract in their hand. The Asset Managers can see what may come through the system, and the listing agent can put a hidden comment about the offer. When I say "May come through the system", I understand some Asset Manager preferred only the top 3 to decide. It is up to the Asset Manager to ask, if they want to see a particular offer. ... This is just an idea. Input would be as follow:
- Offer Price
- Initial check for deposit
- Down payment
- Type of financing
- Close of Escrow
- Is it an AS-IS?
- Is there any contingencies?
- Will there be an inspection(s)?
- Buyer's name(s)
- Buyer's Agent Name and contact number
- And any other information that the Asset Manager want to know about
I won't give her name, because I know she does a few (like 100+ a year) with Citibank however, not only does she "pocket" them, she refuses to send higher and better offers in to the bank before she has heard from her investor....who, happens to be related through marriage to her and, gives her a kick back. YIKES!
This is a problem but, it seems to be more of a problem with the "power" REO brokers than us little not so "powerful" REO brokers. The only reason I know this is happening with her is because, one of the members of the netwroking group she is a member of, which will also go un-nammed, told me that he bought a local investment property from and she told him she would "hold" the property for him or until she heard from him. It so happened that an investor of mine put, an offer on that same property, and didn't get it. It wasn't till later that I found all this out in a casual conversation about this agent I was having with that member of her networking group. The power of Networking....lol
Us Realtors got to be careful here, let alone all the ethics and legal violations.....it can kill your reputation if you get known as a cheater in this industry.....it will kill your business.
It is true, Fannie Mae, as part of the neighborhood stabilization act will look at only owner occupant offers for the first 15 days a property is on the market. They are aware of the investors buying everything up, and the 1st time buyers and others who might be willing to pay more are getting pushed aside because they don't have the cash. This is similar to what HUD dose for all their homes www.pemco.com i belive is the website. Agents still should send your offer in, however this is the case. I got notification a few weeks ago. ( As you may or may not know, Fannie Mae is expemt from many local state contractual obligations, such as escrow, title, city and county transfer taxes, so it wouldn't suprise me if this new practice falls within the same guidelines.)
I like the idea of a set time period preference for owner occupant deals over investors. It gives the average home buyer time to take advantage of the deals out there. Then if no one takes the deal, open it up to everyone!
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