My fellow agents, Time has come for us to recognize the battle that has been waged on us. Battle, we didn’t ask for, Battle, we did nothing to deserve, yet it is here and the battle we must fight not only for us and our future but also for our clients.REOPROs that have been around for a while know what I speak of. A Few months ago, I started to see some articles from auctioneers in reo magazines (DSNEWS), active advertisements by more and more companies, blog posts, and active memberships on most platforms used by lenders to hire agents to sell assets. Today, I hear from my AM friend with major bank, telling me that direct approach like never before to the entire REO division of most major banks is under way. You wouldn't believe how many companies are jumping on this bandwagon. This ghost has come out of its dark corners and if we don’t prepare ourselves for it. I dare not say the words what I fear.In my experience and with some feed back from some AMs, auctions have very little effect. If these companies advertise thousands of listings they only sell hundreds that day and many are at the fire sale prices. At that time the bank gives in and accepts a price that was well below the reserve price. What’s' worse is that this listing was with an agent before. It was cancelled only 30 days after it was listed. Oh by the way, the agent in this case got this listing after nasty eviction, got the property in marketable condition with shelling out his own money, waiting to be reimbursed. This type of process hurts.I am deeply troubled to hear these auction companies bash brokers and say auctions are the way of the future. I am confident after what they charge (10%), and prices they sell asset for, they even come close to what we can get for the asset if proper marketing time would be given. I am anxious to hear from everybody reading this blog if auctioneers net more than we do. If we do then why more and more listings are being taken away from agents and some sold at the auctions at the fire sale prices. This is crazy.We the Professional REO Agents do more each and everyday from occupancy check to evictions to weekly reports to maintenance to negotiate sale for less than any entity on this earth. We protect that asset as it was ours. I now make a point to tell this to all my AM contacts. I believe it’s in their interest to know that we do more for less and get them the best deal possible.
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  • I read the above comments with great interest as I have been an REO Specialist and Auctioneer for over 20 years. I agree with some of the comments, recent Auctions have not produced the money they normally have gotten in the past. The auctioneer doesn't set the price. The current Reo's turned auction assets are based on the prior listing agents prices and the new agent (yes there usually is one) that will work with the Auction Company prior to the actual auction. The investor usually tells the Auction Company what the net price they want for the property. If the property doesn't sell at Auction, it goes back to the previous agent. I haven't heard any of the Auction Companies bash any of us, in fact alot of them are licensed real estate individuals.
    Auctions have always created an urgency, that the buyer only has this moment and one chance to get this property at a steal. I can go out to a seller and give him my real estate opinion on what his property is worth, and he will tell me, you are wrong, I have lived in this property for over 28 years, purchased it for $58,000 and it is worth $750,000. They feel if you sell real estate they know more. Same person, but going out as an Auctioneer, I have never had one seller question my price. Banks use Auctions to move a large majority of properties, ones that have been on the market over 140 days. It has been a great avenue to unload problem properties.
  • I really believe it's because we don't have any reliable figures as to how using a Realtor to liquidate a banks assets are superior to a auctioneer. We need someone to drum em up and we need to market that.
  • I do wish I understood the rationale....

    My husband had and REO listing that was listed at $239,000...over a 3 month period it was reduced to $198,000....he got an offer at $180,000, which the bank didn't even counter, just rejected and then it was sold at auction two weeks later for $130,000! Leave $50,000 on the table? Can anyone out there enlighten us as to 'in what alternate universe this makes sense?' There must be some explanation.
  • oopps, I forgot to put in the link in the above comment...lol, sorry, here it is REO's Become Extinct
  • Great Blog but, I am going to take a bit of a different approach and suggest to both agents and auctioneers that REO's become extinct. Click the link and read a blog I wrote a while back that explains why I believe that REO’s in general, auction or not, isn’t going to be the wave of any future.
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