BPO Mills, Are They Valuable to REO Agents?

BPO MILLS, ARE VALUABLE TO THE REO AGENT/BOKER?

More often then not, I hear agents and brokers say that BPO mills are a waste of time because they don’t lead to listings. I, at one time felt the very same way. However as my business has flourished and Reo Listings are more abundant for me than they were a few years ago when I was breaking into this business, my views have changed.

BPO mills are extremely valuable to my operation and will continue to be a intricate part of the success of my business. They are valuable because they provide a training ground for agents within in my team, and those looking to be added to my team. The agents also get paid for the training.(For Example 50 drive by, my agents get 40 if the bpo is turned in on time and not rejected, for each rejection 5 bucks is taken off.) As the experienced REO Broker will tell you, as well as any Asset manager, REO begins and ends with a Good BPO. As REO agents, and Brokers, we are as strong as our weakest link. Your link starts with the BPO, therefore the more agents on your team that can do quality BPO’s, the better off you are for taking your business to the next level.

BPO mills are great because the have their own built in quality control and QA. What better training could one provide for agents looking to join their REO team? Further more this also allows you to determine when your team member or agent is ready to complete BPO’s related to listings.

My concept is simple, get your BPO’s done ahead of time, and on time at the very least, without rejections and your on your way to being added to my team of REO agents. Well, it not as easy as that. I require my agents to complete a min number of BPO’s per month from BPO mills. This allows me to continuously monitor and evaluate agents on my team. It also gives the ability to assign co-listing agents to those that have proven themselves worthy, just as all of us have as REO agents.

The more agents on your team you have trained, the better off you will be to effectively handle the massive volume that many of us will see. So, the next time you get that email from a bpo mill, consider accepting it to train another. After all, like I said earlier, your as strong as your weakest link. How many REO’s can one persons effectively handle, vs. a team of trained agents? I’m ready for the volume and to take on more. Are you ready?

Very Truly Yours

Jonathan Burgess

Code 3 Real Estate CEO

Absolutely they are valuble, not only for personal training and that of others, but for understanding of the market you are in and personal growth you can achieve. What I mean by personal growth is, I made a game out of the mill work......check this out. For each BPO that I did It was for more than one reason.

1) Money, This is the dumbest reason of all, If a person is doing enough BPO's to make a living they have taken away from the bigger pay off of the real estate market.

2) Origination of the BPO, No, not the mill that assigned it to you. the client that assigned it to mill. Most mills will list the client.....and guess what. I'll be signing up direct with them as many clients piece out the BPO but assign listings direct or through a platform.

3) I have to maintain profile and referrals, Anyone that signs up with an asset co. and does not have a solid list of BPO clients and listing asset Mgr's referrals is shooting themselves in the foot, and leg.....and arms.

4) I want to know what the status of the property is. Example: Short sale occupied and "listed" or "vacant not listed"
There are many reasons for this that I won't list them all but good indicators on the "Shadow inventory" coming out of the shadows, or the increase or decrease of pricing of the short sales that are driving values.

These are just a few reasons, but I do firmly believe "There is gold in them thare BPO's". Now for the the companies that want you to do 15-20 FREE BPO's to maybe get a listing.......I think I'll let someone else do that. Think about it.....you do 20 FREE Bpo's ($1000 value) then you get a listing for $75k that pays you $1000 when all is said and done....they have pretty much just paid you for the Bbo's and moved a property to boot. Like I said, I think I'll let somebody else do that.

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Comments

Sam Shueh August 5, 2010 at 4:31pm

I am so skilled in valuation in the entire bay area and next county, One SAT someone saw me on the street carrying an open house sign stopped me to give him a valuation. I pulled a # out of my hat at $625K. 3 hours later at his home the sold price was exactly $625K.... I got a listing.

A realtor will get hang up on a $110K kitchen to make buyers to believe it is worth that much more and argued with appraisers on home not worth that much more value. Had the agent complete a few BPOs she will realize that is not how they determine selling price....
David Cohen February 19, 2010 at 9:06am

Jonathan,

That is an interesting way of doing business, I know a number of brokers doing business that way as well. Currently I have deparment heads for my office, all REO assignments and BPOs are in my name but I have a valuations coordinator who has BPO contractors that work under her, closing coordinator, property manager, etc... I was just thinking to hire Jrs for each senor department head as the volume increases and the revenue permits new salaries... what is your annual volume of REO assignments, BPO assignments? Anyone else have an opinion on this?
George Bellino February 16, 2010 at 4:26pm

Johnny I have to disagree. There's definitely no time left for somebody to try and gain experience by doing bpo's to a point where they get comfortable enough to try working for companies that assign reo's. That's just too long of a process and too many agents would jump ahead of that person while he/she was learning the ropes.

Also, I think it's probably the worst time to try and get into REO's. There's way too many agents trying to break in and it has saturated the market and made it that much harder to get an account. The tasks are getting longer and the time frames are getting shorter. Basically, the job is getting harder and the pay is getting smaller. You need quantity to survive and only a well established team can handle the type of quantity needed. You cannot wait until the market shift happens to shift your business model as you'll always be two steps behind. That's what happened with the REO's and that's why you see all the agents trying to jump on the REO wave now (myself included.) You have to have the foresight to change or adjust before the market does. The market is changing right now just as agents are doing all they can to break into REO's and that's the example of agents that have missed the boat. I just got involved in REO's about a year ago and have listed/sold about 50 since but i'm still wondering if I was too late and missed that REO boat also. That's why I say that it's too late for somebody who has no or very little experience to get into REO's right now.
Johnny Huang February 15, 2010 at 4:19pm

Honestly, I don't think it's too late for BPO's for anyone. Here's why...who really does the BPO's for mills? Not the kings and queens, but the people that want to learn th BPO's. Once they have the skills, they can feel comfortable doing BPO's for companies that do assign REO's or use the BPO mills as reference of their experience.

In my market, REO's are lacking and short sales are dominant. If people want to break into REO, now is the time to do it. When time comes when traditional sales dominate the market, then the agents (hopefully) will shift their business model accordingly.
George Bellino February 15, 2010 at 3:42pm

Jonathon,

I agree with you 100%. It's definitely the best way to train your agents and to gauge their market knowledge.

Johnny Huang,

If agents are using bpo mills, on their own, for training and for hopes of breaking in the business then it's too late for that. By the time that pays off the REO's will be back to normal levels and back into the hands of the the kings/queens.

Agents have to realize that this will end someday and you must have plan "B" to fall back on. Don't put all your eggs in one basket.
Jose Rivas (DGRA) CDPE, SFR February 15, 2010 at 9:55am

Any type of income if well manage is valuable. For me the value of the bpos is two fold, one the knowledge of the market and the referral, and if the bpo is done for REO companies not just mills it might lead to listings. Second the compensation for the bpos is the money that I front for utilities, preservation, etc. and the money I use for education, pay the platforms and even the conferences.
Billie Dalessio February 15, 2010 at 9:22am

Jonathan-I agree, we are only as strong as our weakest link-well said. One of the best company for BPO OJT (on the job training) has to be Clear Capital. They have training modules on their site as well as each field opens an instruction bubble of exactly what they're looking for- It is practically idiot proof.
Tony Linton February 15, 2010 at 7:52am

Absolutely they are valuble, not only for personal training and that of others, but for understanding of the market you are in and personal growth you can achieve. What I mean by personal growth is, I made a game out of the mill work......check this out. For each BPO that I did It was for more than one reason.

1) Money, This is the dumbest reason of all, If a person is doing enough BPO's to make a living they have taken away from the bigger pay off of the real estate market.

2) Origination of the BPO, No, not the mill that assigned it to you. the client that assigned it to mill. Most mills will list the client.....and guess what. I'll be signing up direct with them as many clients piece out the BPO but assign listings direct or through a platform.

3) I have to maintain profile and referrals, Anyone that signs up with an asset co. and does not have a solid list of BPO clients and listing asset Mgr's referrals is shooting themselves in the foot, and leg.....and arms.

4) I want to know what the status of the property is. Example: Short sale occupied and "listed" or "vacant not listed"
There are many reasons for this that I won't list them all but good indicators on the "Shadow inventory" coming out of the shadows, or the increase or decrease of pricing of the short sales that are driving values.

These are just a few reasons, but I do firmly believe "There is gold in them thare BPO's". Now for the the companies that want you to do 15-20 FREE BPO's to maybe get a listing.......I think I'll let someone else do that. Think about it.....you do 20 FREE Bpo's ($1000 value) then you get a listing for $75k that pays you $1000 when all is said and done....they have pretty much just paid you for the Bbo's and moved a property to boot. Like I said, I think I'll let somebody else do that.
Johnny Huang February 15, 2010 at 6:51am

I believe BPO's (mills or non-mills) will lead to some new business. May take a while and others may think it's a waste of time, but it's a starting or proving ground to agents that want to learn the business. My testimony is that I did a BPO on emortgagelogic, and got a listing from another AM a few months later. Coincidence? /shrug but well worth the work.

This reply was deleted.