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I rejected a listing that went to auction and the commission was 1.25%. Selling broker 1.25%. Buyer also pays auction fee of 5% if he is the winning bid. The auction had to be attended by all parties at the property.
Anyone else running into this in the reo business?
Another TRICK I have seen is 2 third parties taking referral fees and it not being clearly disclosed till after you have had property secured, done your bpo and had the utilities put in your name. Then they ignore your valuation, put property on the market with you for 3 months and then move it to another broker and so on. Last 1 I did like that went through 4 brokers. I think Sally finally managed to sell it. I also wasn't reimbursed for securing it and will not do anymore of these. Worse part about it is that I got the referral from a bpo company that have always paid on time. Not sure why they got into this nonsense!
I have the same dilemma I have been doing the weekly inspections, MMS reports, now it goes to auction. I have been
doing all this work and now will have to be involved in the auction process. By the time I am done I have paid to help them sell this property. I understand that we knew what was involved when accepting the listing But it seems they are whittling away at our compensation and feeling devalued and unappreciated !!
These companies take away valuable time from our good REO companies we have a solid relationship with. DON'T allow this to happen. You suffer and so will all our real clients in the real estate business.
Please start saying no. The referral agreement has plenty of instructions to let you know what requirements you as the agent will have to live up to.
The task are exhausting and my mental state of mind is worth more than the company hoping I will work for free.
Update on the cheap REO company offering such rude commissions. I negotiated a greater commission and was ok with it. But when the auction company called me and explained the process, co-broker buyer pays 5% back to auction co. and agent still made a paltry commission, I had to personally be at the auction on their date.....I said NO!
27 YEARS IN THIS BUSINESS AND BE TREATED LIKE I'm starved to death and a serf! NO WAY!
I hope more agents will just say no. It's disrespect and expect me and parties to the purchase pay their expenses.
Start saying NO.......
Good for you Charlene! Unfortunately as any of us know who have been around REO for some time the playing field is always changing and we are making less money for more work. New agents coming into the business may not know what we know so will do anything to "GET IN" with the banks/servicers. Not sure what can be done. REO is currently decreasing in Charlotte NC due to short sales, being bought as sheriffs sale etc so maybe time to compete with other brokers for resale properties which are now selling as market rises.
Tulsa is seeing a greater number of shorts too. Reo's are here, but seem to be less then in the past. We are learning how to sell short even if it's not what we prefer. It's just a part of real estate today. Tulsa has a stable market and our own fair share of short sales. I agree, a new agent in the business may not know the stunts some servicers are pulling. I love selling and feel blessed to be doing what I like.
We do and will continue to do so. It's encouraging to hear that other agents are pushing back. Several very established REO teams in my market are shifting back to traditional sales now that the market is improving. I think that REO sellers forget that agents always have the option of selling traditional RE where the pay is better, the players more civil and appreciative and work load lighter.
It seems funny, but I would accept 1.25% commission on a property sale rather than
spend 1 hour doing a drive bpo to make $40 after driving to the property and back,
uploading photos and mls sheets, then completing the gaudy long form. LOL.
You may find that getting 1.25% for an REO is a WORSE deal than $40 for a BPO. An REO requires much more time, energy and expense and in fact we often LOSE money on some of the lower dollar assets. REO is not all that it is cracked up to be. We will continue to not take business that offers this kind of pay.
I remember a blog I wrote about this about 2 years ago and I was boo'd and hissed at for even thinking of the possiblity. The truth is, these REO companies know, beyond a shadow of a dobut, that some starving Realtor out there will do the work for substantially less and that's because, they do. Truth is, this trend will continue till at some point, it reaches its breaking point. Either agents will begin to refuse to list these types of deals or the quality of the agent will just be so blantantly poor, these companies will have no other choice. Granted, I really don't think we are at the threshold of either yet but, hopefully by that time, we (REOPro) will have an alternative solution. See my forum thread: REOPRo Makes the Agent the AMC
There will always be agents willing to just get the order. I found out most low fee companies will work you to the bitter end with multiple daily task. The task take time away from paying clients. My job performance go's down and it's just not worth it. Right now I'm seeing a shuffle of listings from REO World to SPS.
Ladies and Gentlemen, the simple fact is that as long as agents agree to 1.25% commissions and agree to do $35 and $40 BPOs, that is all the banks and AMCs will offer for them. As the old campaign went - Just Say No. We do not do $40 BPOs and habitually negotiate $75 to $125 for Drive by BPOs depending on the location. You can too.