Fantastic webinar on Friday - "Why There's NO MONEY in REO...for Most Agents (and How YOU Can Avoid Being Broke Like THEM)". We had a lot of great feedback from agents across the country. Read the answers to the top selected questions below:
Deborah asked: "My broker says that only 1 agent per Brokerage is allowed to list Fannie or Freddie. Is this still correct?"
Answer: To the best of my knowledge, yes this is correct. With these two firms, the relationship is maintained with the broker and the broker can then assign an "agent contact" to manage the REO properties. The broker is still ultimately responsible for the overall performance but the agent handles everything from A-Z. In some cases, the broker may split the responsibilities, by assigning an agent contact and one or more supporting agents, to handle the responsibilities and then each share in the commission. This is usually done in cases where the amount of properties being handled are beyond that of the capacity of the primary agent. This is a situation that you can discuss with your broker. In other cases, a broker may own two or more offices and may secure a separate account for each office, by appointing a different managing broker for each one. In this case, there can be a different agent contact for each office.
DO NOT let it discourage you if you are unable to handle properties form Fannie and Freddie as a "Direct Broker" in this situation. Fannie Mae, the larger of these two institutions, we believe is now outsourcing a portion of it's portfolio to Asset Management Partners or "AMPs". These are third party Asset Management companies who are charged with hiring their own agents and brokers. Most hire BOTH. Handling properties through these firms is a great way to gain experience with Fannie Mae processes that can help to perfectly position you to become a Fannie Mae broker or an "agent contact" on behalf of a another Fannie Mae broker at a later time.
Steven asked: "What of the business model that lenders are playing now ... get close to LOs & you'll get assignments?"
Answer: This is a VERY good way to get on board with many Direct bank clients. A good practice is to establish a working relationship with a Loan Officer with the agreement that in return for your referrals, he/she will personally introduce you to the REO department vendor manager of his firm. I prefer to have the Loan Officer set up a personal meeting between the three of you, where the LO can give you an in-person endorsement. I have used this type of introduction to REO departments by way of letters of recommendation, emails and three way or personal telephone calls.
You do not have to have a ton of REO experience to get a referral. If you don't personally have a lot of experience selling REO, you can always use the track record of your entire office. Sometimes you can simply get in without discussion of your REO experience at all. Everything depends upon the firm and the strength of the recommendation.
Andy asked: "I DO NOT HAVE ANY REOS YET IS IT FEASIBLE TO GET THEM AT THIS POINT?"
Answer: YES! This is a very good time to become a new REO agent. We are already seeing lots of new REO this year. In fact, many banks have opened applications for REO agents, even banks that have had their doors shut on agents for years. The flow has already begun to increase in many parts of the country. Several new "REO Rockstars" have been experiencing tons if success landing clients successfully. Now is the PERFECT time to land your first clients if you are new, and time to land MORE clients if you are experienced.
Bev asked: "Which asset management & REO providers are worth paying and which are not?"
Answer: I am assuming that this is a question about required TRAINING. Basically, if a training program is a direct requirement of a particular bank, financial institution or Asset Management company, then you can rely on legitimacy. An very good example is VRM. This respected Asset Management company asks it's agents to optionally pay for it's VRMU training. The fees and the company are perfectly legitimate.
Beware of "REO Agent Listing" services who promise to put you on a list that is visible to asset managers and then charge you a fee. Rarely do I get reports of much success with these. Some may be legitimate, however, I personally do not belong to any. A few good exceptions are Equator.com and Res.net. I HIGHLY recommend that you register for these and pay for upgrades as required by clients. You may also opt to pay for "zip code coverage" on Equator.com. This can get quite expensive. I personally would work harder at getting "in" with clients by more direct means than simply paying for zip codes and hoping to be found. I prefer to pay for zip codes if I find out that a client of mine who uses Equator.com as their platform uses the zip code search function when distributing properties. Of my clients, most have their own proximity tool that they simply use to measure distance from my primary office zip code, which is included free in your account.
Kenneth asked: "How big of a staff do I need to hire when I get REO contracts?"
Answer: Inside of the REO Positions Manual module in week 1 of Uncensored REO Secrets Version 2.0 you will learn how to outline the positions for your team and when to start adding them. The idea is to add staff when you need them ONLY and to keep your expenses as low as possible. You can certainly start out as a single agent, as many agents do (some STAY that way by preference) and then build out your team as is necessary. I teach yo to build a team that not only pays for itself, but also creates leverage and extra profit for you. You will learn to build a team that is fully scalable and allows you to quickly easily replicate positions as your business grows.
Tim asked: "I Am currently listing Bank of America REO's for an outsourcer, but have had no luck getting approved for BofA Direct... Are there tactics you teach to help get that approval?"
Answer: To the best of my knowledge, BOA is now 100% outsource.
Brian asked: "Fannie Mae stopped using outsourcers in our area of WA State in Jan. I was on with Atlas and Green River, they are no longer servicing Fannie Mae properties in WA State. I was in the process with Fannie Mae and they halted the process as inventory is low in our area. It has been quite a shock to our team. We are ready for multiple properties on a weekly basis and need to make the connections to add properties. Thank you for your help. Any tips for our area is appreciated."
Answer: First of all, DO NOT panic. I would work very hard to get on board as a Direct broker for Fannie. This is also a very good time to pursue relationships with Bank of America, Chase, City (now One Main), Wells Fargo (Premiere Asset Management) and Ally Bank (formerly GMAC) outsourcers. I would also predict that Fannie Mae might begin using outsourcers in your area again in the future (possibly near). Disclaimer here: This is my OPINION. I cannot speak for Fannie Mae nor do I have any knowledge of their internal operations in this regard. I am simply speaking from the standpoint of a broker who has seen financial institutions stop outsourcing and then resume after flow increases.
A.F. asked: "I'm going to the WinDs conference (Yes I'm one of the handful of men that will be there) Lots of AMC that will be there. The vendor managers will be in the room with us for two days. Last I heard there will be 200-250 agents are attending. Any words of advice to make a great Impression on the VMs?"
Answer: I think they will be impressed that you are a MAN there! THAT takes guts. 🙂 Seriously, the best advice that I can give is to not be the slick "salesy" type when talking to Asset Managers and Vendor Managers. Be genuine and be interested in what they have to say on both business and personal levels. Frankly, I spend most of my time talking about personal things and establishing rapport. Personal relationships are a very large part of this business. I have many AMs who are actual "friends" of mine now. I communicate with them via text messages, FaceBook, LinkedIn, etc. all the time. We rarely talk business. When you DO talk business remember the old "They listen to WIFM "addage. They want to hear "What's In It For Me". Avoid telling them how great you are, that you are #1, that you are the best, etc. They really don't care. What they DO care about is just how you can make THEM look good and how you can make their jobs easier. Talk about how you have great systems that ensure on-time closings (many are paid bonuses for on time closings and # of closings per month), how you have high execution (list to sale price) rates, run rates (% of inventory that turn over to sales quarterly), unique ways to keep them updated (ie: "snapshots" of inventory that you are managing for them each week). Present these things in casual, professional conversations. Just avoid boring "Butler talk" and " Sleazy Salesperson" tones.
Holly asked: "Mike do you have to have a brokers license or can it be sales?"
Answer: Absolutely you can be hired as an REO "agent". Some firms require that you be a broker but many hire mainly agents.
Barbara asked: "I received this from an AM company when I registered. "ERRORS AND OMISSIONS: noncompliant, E&O insurance documents uploaded to Equator & the AMP platform should have AMP Broker’s listed on the document, as an additional insured or certificate holder. A binder is not acceptable."My broker said that they would not add them as an additional insured. Just give up on this one?"
Answer: No. Your broker may not understand what they are asking for. If you cannot explain properly then ask your insurance agent to. Listing as an additional insured or certificate holder is a very simple thing that can be done in a day. It is no cost to the broker and should be no risk (disclaimer: I am not an insurance professional so don;t use my advice. Consult a professional). I have done this on many occasions. It is very simple and quick and can only benefit you and the brokerage. If your broker is not one who is willing to "get with the times" and adapt to the practices of today's market, you may want ot consider whether it is a good fit for you. This is your decision.
Ashley asked: "I had a local BoA agent not present my offer in Equator and secure a buyer himself. Not to go into great detail but I have substantial proof this happened. I have been working for a while to get direct access to the REO listings with BAC. I already serve them through PMH. Should I proceed to complain to BAC or would, in your thoughts, black list me with them as to not get in the door. What this agent did was clearly wrong but I want to build a positive relationship with BoA and not be viewed as a trouble maker. My wanting to turn him in has nothing to do with that but rather protecting my buyer client who's offer was never presented. Any thoughts or insight?"
Answer: First of all, I always adhere to the rule of not contacting another broker's client unless I have exhausted all other avenues. And at that time I always adhere to the local real estate association regulations for acceptable contact. Remember that listings belong to the BROKER, not the agent. I would pursue that avenue first and present your case and ask him or her to seek resolution for you. As far as "blacklisting", I cannot speak to the fact of B of A even having one,. They are HIGHLY reputable. I don't often find that being the squeaky wheel generally gets you very far with clients. I also believe in standing up for the rights of my clients. I would proceed as I recommended above and hopefully you will get a satisfactory resolution without having to take further steps. If you don't have any luck then you will have to make your own call as to what to do. On a side note, I doubt highly that the person you speak to at B of A will be the same person who is involved with onboarding of agents. They have a very sophisticated process.
The short answer: Do the RIGHT thing. Never seek revenge. Keep your client's interests in mind. This seems like what you are doing.