REOs the truth and nothing but the truth

Just got back from a mandatory REO agent conference. Cost 149.00 plus 2 days of really aggravating reprimands,, threats and some really demeaning reality. Oh and 109.00 per night hotel costs plus 2 days away from all of my other work which pays the bills. The cost to be a chosen REO agent . 499.00 in the first few weeks for "training" Funny considering I have been doing REO work longer than the people who wrote the "training course". (and they were not even a Realtors) Then another 199.00 to be added on the platform. Cost of the signs and marketing material which are mandatory for the asset owner.

So far 1200.00 in expenses - income 0 for this new company, one of the now 15 I work with. One I have worked with for 16 years now.

What I learned, well as a veteran REO agent of over 16 years I learned I have gone backwards. I am a broken person who has sunk to the lowest depth any agent ever imagines. All REO agents have become mere robots/ tools of the REO asset owner. As Dangerfield quipped “No respect no respect at all!!” 16 years ago I was paid very well in the REO field. Not many agents wanted to list the worn down un-kept "dirty properties" Fewer yet wanted to show clients these low priced fixers. So I listed them and almost always sold them and was paid 6.5 % with no fees. No platform fees, no referral fees, no fees at all. I was also paid a management fee to oversee the trash outs clean ups and maintenance. A 2500 minimum to assist in a cash for keys, 50.00 for the listing BPO for that asset and for each BPO I did after getting the listing. The BPOs were a one page 15 minute form with 3 sold and 3 actives. One liners and a few comments on the bottom. No status reports were ever called for and there was no mandatory anything other than just sell the asset. I was valued and treated as a skilled professional by the asset owners. The list price was set and if someone , anyone made an offer in the first 24 hours that was close to the list price, well it was sold. No long drawn out drama filled waiting period or wild price expectations. All utilities were put directly into the asset owner’s name and mailed by the utility companies to that asset owner. I paid for nothing, billed nothing and was never expected to be responsible up front for a single thing the property required.

Fast forward to today. I am expected to have 5000.00 in reserve for each property I am assigned for repairs , past due taxes, past due HOA fees and anything else that may be required. I am expected to bill all my expenses and pay 5.00 per invoice, wait 6 weeks to 90 days or even longer to get reimbursed, Of course I can not charge interest or a service charge. Just lend the money free of charge to multimillion dollar corporations. I am expected to do weekly status and condition reports, weekly full property checks with pictures, monthly BPOs free of charge within 2 days of the request. Now that BPO is a 3 page form, more detailed than any full appraisal. It takes about 2 hours to complete and has some really ridicules demands as well. I now an expected to do cash for keys and even assist in evictions all free of charge. All utilities and security deposits for them are in my name and mine to pay. I now get 2% to 2.5 % commission maximum(many are a straight 1000.00 for any property 100 K and under) with a 140 to 175.00 charge per listing for platform fees at closing. Out of my commission I also pay a referral fee to the assignment or asset company. I have to carry 500,000, to 1 million E & O. Which is very expensive if you do CFKs or eviction work, which is mandatory for all REO agents. I also have to carry a personal liability policy for 4 million and show proof of both every 6 months to a year. I have to pay for at least one yearly background check. Pay a yearly platform fee of no less than 400.00 yearly . A yearly education course fee of no less than another 400.00 and now mandatory conferences at my expense no reimbursement and no escape from attending, they are mandatory! Now I have "report cards " with categories for everything from BPO % to DOM averages to Owner occupant versa investor sales. I am expected to print or buy all the asset owners marketing materials including signs and brochures for their mortgage divisions. Send them buyer leads , also known as recaptures and give them monthly reports of the leads I send. Now I am reduced to a non respected very used, controlled and low paid unwanted necessity in the REO world.

So every time I see or hear any agent say " How can I get into REOs?" I shake my head and say "be a greeter at Walmart. It is easier, much more profitable and yes you can keep your self esteem and even some dignity too."

Yesterday, today , what will it be tomorrow? Well my guess is an REO agent will be expected to work for free. Don't laugh or doubt it HUD actually did do this for a while. It is coming if we do not stop and say "No more!!" I am now devoting time to re establishing my conventional Real Estate practice. Let the starry eyed REO agent wanna bees have the REOs and let the asset owners ….well you know where I am going here.

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  • Barbara, I too got the e-mail about Altisource acquirying Equator and I just cringed.  I have been turning down listings from Altisource because I'm tired of losing money and it wouldn't surprise me if "Equator" is going to be another "Fee" they charge the listing agent to list their properties.  I still do their paid BPO's but unless a listing is over $200,000 I can't afford to take it....and I've seen very few even close to $100,000....most are $75,000 or less and mostly less!!

  • Barbara - Truth as only a veteran from the trenches could tell it. I tried REOs for a couple of years. Let someone else have 'em. I show the real cheap ones to a couple of my cash investors, but other than that - No Thanks - same for Short sales. Life is just too shot.

    New business model began 8 moths ago - one man operate out of my 3rd bedroom in the country.

    I mail 2,000-2,500 post cards a month to real estate owners - 90% rural, but a few nice subdivisions on the very outskirts of town. I list, list, list, list, list, list, list, list and will show my listing over $50,000. Do  not show the cheap ones. (I give 'em great maps, surveys, property line on aerial photos, everything they need to go look at a $30,000 property). Do not show other agent's listings. I want MLs agents to sell my props and they do, while I take care of my chickens and dogs and do a few things around the house. Sick of buyers wasting my time, lying to me and just simply pissing me off.

    Life is good!




  • Why are there so many REO properties with no utilities on (at least in the middle Tennessee area) these days? MLS remarks state that buyer will turn on utilities for inspections. I listed REO properties for a while, and I always had to turn on utilities. Even if there were obvious plumbing problems (like the water heater is stolen and the pipe is wide open), it was BIG DEAL "NOT" to turn the water on.

  • Here's a heads up for all REO agents working on the Equator Platform. I just received this a minute ago.

    I am not even going to guess what a disaster this is for all of us who have been using EQ for over 10 years.

    Dear BARBARA,

    We are excited to announce that Altisource®, a premier marketplace and transaction solutions provider for the real estate, mortgage and consumer debt industries, has announced it will acquire Equator. We expect to close within 30 days.

    What does this mean for our agent network? Equator will not be changing our name, our offices or our management team. There will be no changes in the way you transact business today. In the near future, we will be even better equipped to provide you with value added services, technology and relationships. Equator and Altisource have a highly complementary set of technologies and services which will enable us to provide a more comprehensive, integrated solution and build new products and services to better support your business.

    We are excited to launch this next phase of our company and our agent network, and are deeply grateful for your ongoing support. You can continue to look to us to provide you with the same great service and technologies you have come to expect from Equator.

    Please feel free to contact us personally should you have any questions.

    Christopher Saitta
    Chief Executive Officer
    John Vella
    Chief Operations Officer
  • No 5star here, nor CDPD.  Most of these ad hoc designations are just to make money for the creators of the program and not to get leads.  BPOs to me have been and will be a way to stay current with market trends while still getting a few bucks.

  • I love reading that I am not alone in my thoughts about BPOs REO's

    and Real Estate in general.  And no Barbara I am not a member of Five Star in any way.  A friend of my at a different agency has been and said it has not helped her at all.  I have already started being "out of town" with about half the BPO companies I have dealt with in the past.  My E & O expires next month and I plan to be very selective with who I sent the renewal too.  That way I don't even have to worry about getting orders from the ones I don't want to deal with anymore.  Just a thought of how to stop getting calls.....same with some of the asset companies.  

  • Survey, How many of you did the Membership with Five StarForce? I didn't and told them never would pay a fee for REO's plus a referral fee. Get Real. I also sent email to vendor department and state we will see Service Link in the BK headlines soon.

  • This is indicative of the real estate profession as a whole.  Buyers can see a list of homes for sale online in the aggregators themselves with values included and think they can do it on their own.  Banks, AMCs and Servicers feel the same way, real estate agents are fighting for my business so I can pay less and get more.  Unfortunately for those of us seasoned REO agents the starving agents have proven them right.  It will take a while for the real professionals to get back to where we should be.  As fair market sales increase and the average agent stops trying to do it all and gets back to the business they belong in, REO agents will get back their business.

  • I believe the Real Estate industry in the midst of a major transition and things will get better, or worse depending on how we handle the situation. All of us in the industry have gotten a black eye from the few who have exploited and violated professional and ethical rules.

    I do agree that there are some vendors you are best off staying away from, however, this is a great opportunity to take a step back and perform a complete analysis of your own personal performance, your attitude towards the business, your business plan, your education, where do you see or visualize yourself in this business short term and long term, and in the end after you have completed your own personal , is this all in line with your own personal goals and objectives.

  • 100% the truth, we are getting ripped off and we do not even know it, in the name of REO.

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