MLS Bank Homes Newswire 1/19/09From national correspondent: Ms.Catarina HuntingtonThat is the headline that Realtors can only hope for at this point in time. A more proportioned assignment of REO Listings would have a dramatically positive impact on the Realtor industry. However, as of January 2009, REO Listing Agents continue to own a stranglehold on REO markets while the rest of the industry sinks in despair.An investigation into the facts surrounding the REO listing market is interesting....2 million foreclosures up for grabsNationwide the “private club” of REO Agents currently monopolizes about 1.7 million active REO listings. In 2009, 2.0 million more properties will foreclose and according to a recent report by "Credit Suisse" the US market will be averaging 2 + million foreclosures over each of the next 4 years.Estimates are that 150,000 Realtors nationwide, provided the pertinent education, would be very qualified listing agents of REO properties. There are no specific prerequisites to become an REO Agent. Qualified Realtors simply need to possess a willingness to enter the REO arena and be thoroughly educated on the unique aspects of listing bank owned foreclosures.Hence, there are 150,000 active full time Realtors in the United States with 2 million foreclosures "up for grabs". If divided equally each Realtor would close 13 REO listings per year for the next 4 years.REO Agents Dominate MarketInstead, roughly 5,800 Realtors Nationwide sold 1.6 million REO homes in 2008. That translates into an average of 22 closed listings per REO Agent, PER MONTH. That certainly doesn't sound like a “spread the wealth” philosophy does it?The REO industry's current model appears to provide for a single beneficiary: REO Listing Agents.Unfortunately the industry’s model comes at the expense of the lenders themselves, frustrated buyers and the tens of thousands of agents left out to dry.The vast majority of REO Agents are overwhelmed with inventory and under staffed. Realtors “in the field” showing REO properties tell me that they understand this “all to well”.The systemic problem within the REO Agent "underground" appears to have a multitude of negative consequences which result in longer market times and lower sale prices, say industry sources.Private enterprise is fixed on changing the dynamicIn a brief telephone interview I conducted with Ms. Simona Miu a spokeswoman for ForeclosureU.com a private educational institute established in 2005, Miu stated:“ForeclosureU is committed to changing that course in 2009. Stating that ForeclosureU.com is going “at the establishment head on”, Miu says that ForeclosureU is launching a national advertising campaign in various targeted media outlets promoting the importance of their “Certified Foreclosure Specialist Designation and Training for Realtors”.….“In 2009 our sole focus will be dedicated to educating and arming 25000 Realtors to earn their fair share and rights to the REO pie……Graduates of the “CFS” Training will receive everything required to meet their career goals and seize these emerging markets”.Miu went on to provide some of the ways ForeclosureU intends on accomplishing this challenging feat:“CFS” graduates are provided unprecedented (a) training on listing REO property but it doesn't stop there (b) “CFS” graduates are entered into the National Database of “CFS” agents (c) an aggressive print/electronic and internet marketing campaign (promoting its “CFS” agents) targeting the entire default (REO) industry is being launched (d) In addition a proprietary list of “REO asset managers” and their direct contact information will be made available to all “CFS” graduates.”Miu stated that ForeclosureU is filling the gapping holes left by local, state and national educational platforms that have failed Realtors miserably in providing current educational requirements.ConclusionIf ForeclosureU and companies like them truly step up and provide Realtors the tools they need there is little doubt that, at least in this columnists opinion, Realtors can surely change the course of their careers and maybe even the course of the foreclosure debacle as a whole.On a personal note I am pulling for ForeclosureU and companies like them. Small businesses and product/service innovation is the only viable macro solution to this countries economic downward spiral. Getting our political leaders to understand this is a whole other conundrum.Statistical data and additional content provided thanks to:Real Estate Trac, City Data Co, U.S. Association of Real Estate Agents, Foreclosure University, Zillow BlogMLS BankHomesLas Vegas, NV 89044
Alicia,
Kudos to you for such an honest post. Would you mind sharing with us where YOU got the education/courses/certifications necessary to get into REO's? Or what courses you would recommend? I don't mind the hard work, but I would rather work smart.
This made me laugh!!.. Before nobody wanted to even touch foreclosures "too much work". Now they are feeling "blacklisted". What a bunch of ! B..S..! We (REO listing agents) work very hard to get those listings.We spend long hours doing reports, marketing, spending money on property preservation and getting educated. This is the area of real estate we choose to work. We are independent contractors and our income is based in our hard work and experience. Do not wait for me to start sharing MY WEALTH. It is not the government's business to control how much I work. If you want to make money in the REO market, get education and work hard.. nobody will stop you. I learned the ropes of REO on my own. I spent money getting knowledge about foreclosures, doing the job nobody wanted to do in my office. High producer agents never shared their wealth with me when I was hardly making enough money to survive. Now, I am the high producer. Do I should share my wealth with them?... NO!!
i think one of the biggest obstacles to beginning in the reo listing market is cost. when the large lenders or servicers expect the agent to front 1000s of dollars to get the home ready, market, heat and secure..they cut out tons of potential agents. I just refused a listing for an Ocwen home, potential commission maybe 1500.00, but first I am to cash for keys, secure, put all utilities in my name, market and wait to be repaid. It is not worth it. A current GM listing owes 600.00 for heat, propane in Mn. ain't cheap..they will pay at close, after we needed to winterize just to cut the heat bill. Buyers will want a dewinterization, more cost..and if the inspection does not go well, will add to my overhead again...AM says no payouts for the extra costs..hard to fight if the existing reo agents have built up a healthy slush fund for these costs
As real estate professionals we need to be flexible to get into an opportunity. It is the same as when the phone rings at the office you never know what is passing though you. Once you are in REO league you can assume you will be invited in the future. Do deligence and it more work will be coming.
My team currently works with over 70 different lenders, outsourcers and bpo mills. I have found that if any agent wants in the business, they need to get off their but and do something (just like getting a FSBO listing). Persistence beats resistance (almost) every time. If an agent wants to be a foreclosure agent, learn about the business and just do it. I give free seminars every 90 days in MI to agents who want to be REO professionals and get into the business. I teach less experienced REO agents how to make profit and close more homes. For Free, just because.
Comments
Kudos to you for such an honest post. Would you mind sharing with us where YOU got the education/courses/certifications necessary to get into REO's? Or what courses you would recommend? I don't mind the hard work, but I would rather work smart.
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