What is wrong with this industry?


"...if all of these REO companies are scaling back, why bother purchase AMP under res.net or get certified with REOtrans if we don't know if there is going to be enough work for those of us who can't get into any other company or the other companies are telling us that they are going to give their work to the preferred brokers ?" Anonymous

As I have always said and will always tell you, it's not the "company" you're with or the subscription level you paid for that is going to give you any chance at getting a REO.

The REO industry is the preverbal “boys club” and for those agents who don’t understand this concept, you will fall victim to false promises made by Asset Management Companies and Technology Platforms alike.

I have preached, revealed, screamed, wrote, published and explained to all of you through my blogs that unless you are actively contributing to this industry…..your success in breaking in is going to be less than stellar, if at all.

“Ned” our resident Asset Manager has revealed to many of his weekly column readers how to either break in or get more business. In fact, his most recent column is about this very topic yet, I didn’t but, 3 orders come in today for a FREE Agent Site, through the REOPro store, I only approved 2 blogs today and the forums seem dead today. Not to mention, I counted at least 4 articles in the Ask the AM archive on this particular topic or at the very least topics very similar and I have about 3 blogs myself I have written along with 1 blog that is nothing more than my top 8 blogs that any REO agent should read. So, with all that being said, why do we still get members who fall prey to the false and blatant lies running rampant through our industry like hungry lions on the plains of the Serengeti?

Granted, even industry juggernauts like REOTrans or RESNET seem to be participating in the “Realtor mop up” but, their lofty place as industry captains makes people like myself see these actions by them as shameless and disgusting yet, we still get agents who are clamoring, saving up thousands of dollars and purchasing higher and higher levels of “preferred status” for nothing more than the promise of a chance.

I read a recent forum thread titled “Valigent” posted by Janet Frederick on REOPro where one of our members Byron Guillermo copied and pasted a reply from an Executive with Valligent named Jeremy that said, Quote…

Lenders take advantage of the fact that many real estate agents in this economy are desperate for listings,”

HELLO! CLUE PHONE IS RINGING! It’s not just the lenders….it’s everyone in the industry. My point is, they can make the promise of a chance, with no guarantee and they will still make money hand over fist from the contract they have with the bank, to the “technology fee” you kick back and then your monthly membership fee and annual “preferred broker” fee. It’s a cash cow because of the very statement made by Jeremy with Valligent.

I am trying to explain to you, if you feel victimized, if you feel as if you have been taken to the cleaners, if you feel like no matter where you go, it’s more and more money……well, yeah, you’re right but, that’s because people are paying for it. Caveat Emptor my friends, or in other words, Let the Buyer Beware.

So, how do you avoid these people and scams, how do you break in……well, it’s as I have always said, it’s about developing relationships, providing a useful service and becoming an expert in your field. If you want to know more about my opinions on these things, read over my blogs, read the AM column this week and search through the archives.

E-mail me when people leave their comments –

esse was originally licensed in September 2005. He started his career right as the real estate industry saw it’s worse collapse since the Great Depression. As a result, Jesse sought out opportunities to work directly with banks, focusing his career liquidating foreclosed homes. He worked with some of the country’s largest lenders, asset management companies and quasi government supported entities. This highly competitive field introduced Jesse to an intense time of development where he received top notch education direct from national policy makers, government entities, multi million dollar portfolio managers and many others. Jesse became very successful working with banks however, something seemed to be missing.

As a direct result of listing and selling foreclosed homes, Jesse found that his career could also turn into a passion. He believed he could naturally transition his business from selling foreclosed homes to helping homeowners avoid foreclosure all together. His experience and knowledge working with banks gave him invaluable insight on what homeowners could do to avoid foreclosure. More importantly his experience would give his clients an edge when working with their banks to prevent foreclosure, keep their home, or if necessary sale their home.

Jesse has built a career working with some of the hardest real estate transactions known. He has worked with homeowners who are facing seemingly insurmountable odds, negotiating with lenders who don’t see homeowners as nothing more than just a number. Where others would have thrown in the towel and given up, Jesse has persevered and proven to his clients he cares. He has managed millions of dollars in real estate at any one time and worked with over 30 different lenders and banks both directly and indirectly.

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  • Just remember, all this shall pass and the only ones will be standing with their heads high are the true REALTORS that have done their job the right way with ethics and integrity. Many of these opportunist businesses will fold and close their doors or find different venues because there will be no needs for them. As the market changes there is always new challenges and new business ops for the expert and not so expert to take advantage of. All I can say to the true worriers out there is don't get wrapped in the "I need to do this or I am not going too make it"! You made it before and you shall continue to make it as long as you stick to the right and honest path. I am also not sure if continuing doing TS is even worth it anymore since I have experienced it few times when I receive an assignment and the homeowner has already sent the packet back to the bank. We call the bank and the bank confirms it, but yet it is assigned!!?? Yes I get paid the $30 to $50 but that is a waste of everyone’s time and is aggravating to the homeowner.
  • Jesse: Bravo for saying it like it is. The next thing to come is the "Short Sale" assignment mills.. I can see those developing now. They all say they have a relationship with the bank.. and they need a almost free or free BPO and I will get you the Short Sale if I can. The companies only hire agents and take offence if you mention that your a Licenced Real Estate Agent to the borrower when your there doing a home inspection. Everyones see a quid pro quo.. Real Estate Agents are going for Real Estate Business not Free BPOs.. they expect something in return for services, as they should. When that does not develop the first word that is used is Fraud. Then add a sign up fee or a training session for a few hundred dollars done on the Internet and wa la your an expect certified by someone that does not even know what HAFA or HAMP are... I asked Loss Mit. Off. today about what thier plans for HAFA were and they did not even know what the program was. Experts at not a single thing.

    This happened to a close personal friend that is really just trying to do a loan mod. The lender sent out an "INSPECTION COMPANY".... not a bill collector like Titanium, who read the mini Miranda... its a twist the lender believed they could get away with... But the guy was an agent doing a BPO reporting back about the interior condition of the home and who lived there... sounds like collection information to me.... Chase send one of these inspectors out to one of my clients home to do a BPO.. on a short sale.. they are working for a bill collector thus they are a bill collector, at least in my view.. But they state they were only doing an inspection and the guy leaves behind his Real Estate Card.

    Interesting times... we are living in.
  • I am not aware of any company who guarantees business. Why not, you might ask. Well, that is a complicated question but, I am not one to shy away so, here I go.

    The first reason these business can't guarantee business is because, they don't have any business to start with. Many.....MANY, AMC's (Asset Management Companies) are start ups and don't have relationships with those decision makers that can send them business, kind of the same way we have an influx of Realtors entering this industry but, none of them can get business because they don't have relationships with the AM (Asset Managers) that can send them business.

    The sad part of this concept is, most of these companies have business plans and, management styles that don't make them competitive. In fact, most of these companies are doing nothing more than copying what they see another successful company doing. Once again, much like the influx of Realtors coming into this industry for the first time.

    The criminal part of this, at least in my opinion is that the fees they are charging are really the way they fund their start up. You see, many of these companies couldn't go get a loan from a bank because, they either don't have a business plan or as I previously said, it's fatally flawed and the banks see that and therefore, they don't give them loans. So, unfortunately, they have no other choice but to get their start up funds from unsuspecting Realtors.

    The second reason these business can’t guarantee business is because the banking sector isn’t stable. In other words, bank merge, banks get taken over by the FDIC or banks go under so, decision makers change, are out of work, or find other industries to move into so, contracts end, revenue streams dry up and these AMC’s aren’t diversified enough to save their own business. They crash with their bank clients. It’s just not possible to guarantee business when you yourself don’t even have any assurance the person sending you business will stay in business.

    The third reason these business can’t guarantee business is because they never intend to send business your way in the first place. This to me is why some of these AMC owners should be locked up. I can’t stress this enough, some “reputable” companies are out there fleecing Realtors. Some of you, yourselves have fallen victim to this, I have myself, TWICE! It’s awful, it was a hard lesson learned, I lost about $1,500.00 dollars, lot’s of time, energy and confidence because of this AMC. BUYER BEWARE!

    The three most important things you can do to get in this business, stay in this business, and thrive in this business is to develop relationships, provide a high quality service and become an expert in this industry. I will say it till I am blue in the face because it’s the secret…….well, it’s not really a secret but, you get my point.
  • So what your saying is that if I sign up for all of the following companies,
    conferences and training, that I still might not get REO business?

    Paradigm - $1,000
    United REO - $324
    Absolute REO - $295
    Universal REO - $295
    AMP - $495
    REO RED BOOK- $1,200 Directory Ad
    Assign REO - $99 Premium Member
    REO Network - $1,100 Premium Member
    RES.NET - $250
    Disposolutions - $125
    Equator - $600 for Zip code coverage
    Default School Training - Citi - $295
    Default School Training - AMHSI - $800
    Default School Training - Wells Fargo - $700
    Default School Training - One West - $400
    REOMAC - Spring Conference - $895
    FIVE Star Conference - $800
    REOMAC Fall Conference - $895
    Fidelity Conference - $600
    Green River Conference - $125
    CAMREO - $299
    LAMCO - $199
    ETC REO - $250

    Please advise which ones I should send checks to first...

    Mike Shannon
    Should I go on...?
  • Trevor, some of the better agents in regards to short sales, REO listings all in some degree are lucky or just happen to be at the right spot at the right time to gain a sale, client, or listing. I remember a brand new agent first time doing floor duty and one minute after taking over a lady walked in wanting to sell and to purchase. After all the escrows closed and she got paid her remark was, "Real estate is so easy." Agree that designations are not important but still any designation shows some effort put forth into gaining some education. I sport a Default School Designation 'Reo Default Certified Professional' as some of the better sought after companies require these classes for agents to stay active and to receive assets just as E&O insurance is required as well as an active license. To obtain your broker's license you are required to take several courses and to pay the state for this license. Maybe we should have other real estate licenses given out by other companies to give the state some competition in regard to licensing real estate people. It used to be that I can do mortgage lending with a brokers license and now there are state requirements placed on those who would like to continue doing loans. We now stand out as a check book to companies wanting to sell training or designations. You are correct and I agree to your post.
  • Pam, it is so important today to make the asset manager look good as it is their job to get these houses sold and they also have a score card that their company uses to decide to keep them or to let them go. I make them look good by marketing these properties and getting an offer that sticks and sold ASAP. Thank you for being more than a lister. Agents wonder why us old timers get all the listings concerning REO's and you have explained it so well. Thank you,
  • My asset managers are more than clients to me. They are my colleagues and friends. I work my fingers to the bone to make them look good and to further their career. When I put one of their names down as a reference, I know that they will give me a glowing review because my history with them shows that I am a no drama, high net closer. That is all that they care about.

    Asset managers are people too. They talk to their industry friends in discussions you and I would never be privy to. Even if you never pay a dime, if you have a few well connected clients that you hit it out of the park for consistently, you will never want for a listing.
  • The comments are great and very informative and am adding my 2 cents worth before someone else does. Asset management is now asking agents to take education to continue receiving asset assignments. Default School and REO Boss are some of the classes that was required to keep getting asset asignments from PAS, Citibank and American home. I can't say that I'm better off from this education requirements but am now updated as to the current acceptable ways to fill out these companies reports. The important thing for agents is to be flexible and to sit down and to be honest with themselves about their strengths and weaknesses and to act upon those strengths and obtaining the education to lessen these weaknesses and changing them into strengths. For example if you are weak in REO language learn the buzz words of the REO world, find out what property preservation, winterizations, re-keys or lock change outs really mean. When an asset manager calls you should know how to answer their questions about how you can maintain and sell these properties within 30 to 90 days. The time for loans this year has increased from 30 days to 60 days for closing as this is important for agents to know as asset companies can impose a 'per diem' charge which can lead to a 'fallout' of your escrow. 'Per Diem' a buzz word learn the language then you will be more knowledgable when asked questions by asset companies.

    Don Hascall Broker
    REO Default Certified Professional [a Default School designation]
  • You guys are right about the instant gratification, we expect to have the first REO closing right after we sign up with the AMC online, etc. Before I went to Five Star last year, I read in some blogs and this forum some agents bragging about how they come home from the conference with new business, some got a listing right away, etc.

    I had a great time at the conference, met some key people and make some new friends, keep remembering that this is a peoples business. I came home and my phone didn't ring, but I keep in contact with some people, in different way, some letters, email, thank you cards, post cards, nice to meet you cards, I am bore so I am writing you cards, etc...

    The conference was in Sept, I didn't hear from any of my AM contacts until December, I was seating at the table with an AM but he didn't have any cards, and he told me he was a contractor not an AM, we had a good conversation, and I gave him my card, the other agent seating at the table with us, told us that she didn't have any cards, because she was saving her cards for the AM. I received two listing in December from this AM. Met another AM from one of the pay upfront companies, and I kept in touch with her, but never $igned with the company, in January I received two assignments from her, and I still haven't $igned up with the company.
    I can say today that Five Star was very successful for me, but in November I could said that I met great people there, eat good brisket and enjoyed the parties, but no business.

    One of the first things a learned in real estate was farming, In REO we need to be farmers and cultivate the relations and friendships that we make. I know the birthdates, spouses names, anniversaries, kids names, grades, colleges they attend, favorite sport teams, etc from most of my asset managers. To me an AM is another client, and clients are the most important people in my business, they are my cash flow, so I always develop a sincere interest in all my clients
  • Hi Billie,

    You're right, training would be the one thing I will always say you can't get enough of but, it is still a Buyer Beware situation. I have had a lot of training....proud of it yet, some of it wasn't worth the cost. In fact, a couple of times I felt cheated and I can remember one time specifically that I actually thought about filing a small claim suite against the organizer.

    Lesson learend, now I don't attend any training that my REOPro network doesn't recommend. Kind of like how members come on to find out the experience of others with certain lenders, servicers and 3rd parties....well, i do the same for training and certifications. Just another reason why I love REOPro.
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