Because I have seen several recent post about OCWEN no longer taking on Listing Agents in CA. FL and, NV I decided to blog on a this recent trend of doing away with the Listing Agent.
Now, before I get started in on this topic, let me make something very clear, I have no first hand knowledge on these situations I will be discussing. I am simply putting together what I have heard, read and understood about the REO industries changing dynamics and how it might effect me or you.
Ok, so, OCWEN is no longer taking on Listing Agents for their properties in CA, FL and NV so, how is that possible?
First off, you need to understand that many of these disposition companies are trying their hardest to figure out how they can grab more and more of the listing agent commissions on these properties. Many companies are notorious for reducing commission, attaching high split percentages or adding un-necessary fees due from the listing agent. The terribly sad part of all this is, many listing agents have folded to these claims on their commission in order to simply close the deal and make something vs. nothing.
Well, these practices have led many companies to logically pursue these commission grabs to their conclusion by asking a simple but, dangerous question and that is, “How can we keep all the commission for ourselves?”
The natural answer to this is to do away with the Listing Agent and keeping the 3% average commission on that side of the transaction. So how can they do this?
Well, they aren’t really getting completely rid of the Listing Agent. You see, instead of having 50 agents to cover a particular county, they reduce their agents down to 3 and then offer them a job to act as their agent, with a steady income and benefits like, retirement, health, dental, vision, paid vacation and more.
So how is this even possible, you may ask. I have one word for you and that is TECHNOLOGY! These companies invest lots of money in developing specific software that can almost manage the entire listing from birth to grave. This software is so highly developed that it can dramatically reduce the number of required agents to work the same, if not more workload than before.
Many REO agents are already using some of this software when you log into your Asset Managers Back Office and input your forms, update your work flows, etc…. All the company has done is taking that software and perfected over the years of use that you as a REO agent helped with.
Now, you’re thinking, “What kind of Realtor would do this?” Well, I can assure you, plenty of Realtors are out there that would give up their commission and work for a company just to do the same job but have, regular income and all the benefits.
So….I know I probably just rained on your REO parade but, it’s important for you to know this industry is changing. REO will not be the same when we end 2009 as it was when we ended 2008.
Good luck, stay safe and hopefully I will see ya on the flip side.
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