I've been doing BPO's for three years. I've built a sizable BPO business, but I would really like to establish the REO side of the business. I am located in Cape Coral, Florida, but I am willing to service the entire Lee County area. Can anyone tell me the best way to get my foot in the REO door? There is still a steady stream of REO's in our area.
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The reo business is turning over on its head rt now.... Seasoned realtors w/ 10+ yrs in reo arent even sure whats happening. There is talk about lenders selling their negative portfolios to hedge funds w/ the promise to offer loan mods for 2 yrs before foreclosing..etc-- this could throw a major wrench in the business for the most part, then there is talk of B of A setting up their own real estate division.....(like Ocwen did).....
I dont know that reos' will return to be what they once were..... on top of that, lenders are making the business almost impossible by demanding us to contain their costs..... repairs, utilities and their deposits.....and be responsible for curing certain title defects.....as well as protecting their assets for them......all this boils down to money/time from us....after we pay them to qualify us w/ 10 different certifications at 500.00 a pc.....yearly...
Then, the E&0, Gen. Liability,Resnet, your Website, and your "on-going" education......and we cant send our assistants to take fotos for us anymore.....so,... it becomes a big mess.... then you can worry about some ticked off agent that was not selected from your pool of offers calling your asset manager to to tell him your un-ethical... or whatever they conjure up.....this hurt alot of very fine,experienced agents in the past....... this business has really become a nightmare..... after all this, I wonder what this industry really intends to do with us..... wont be the 1st time an industry gets served up as a sacrificial lamb.......these are very tricky times..... I would suggest shortsales seem to be the safer, more profitable direction for rt now...... reo's and the way we know them.. may be a thing of the past.....even Hud and VA are sitting fairly quietly.........hmmmm- just my 2 cents.....
Do you hear me clapping Rose? I have this conversation every day with agents who inquire How to get into the REO business. Yes Brian, on my response I forgot to mention, commission is not always a full 3%, add to that, most asset management companies keep 35% of the 2-2.5% commission, we receive no compensation for managing the properties which in many instances hundreds of dollars come out of our pockets, getting reimbursed for expenses can be a nightmare, if invoice or any other documentation/photos needed is missing or they find it to be incorrect/incomplete you may not get reimbursed (it happens), oh! and some lenders use a system for reimbursement where YOU have to pay $5 every time you submit an invoice!! If your listing gets reassigned for any reason, all those hours of hard work, checking occupancy, doing the exterior BPO, negotiating relocation with the occupants, supervising initial preservation, establishing all utilities (try an average of $800.00 deposit with electric company here in FL) doing the interior BPO, weekly visits to the property, etc, etc, etc go straight down the drain. Are you ready?
BPOs are not really going to do it, specially here in FL, we are over-populated by Real Estate Agents. You need to submit applications with every single asset management company you find on the REO Companies listed on this website, no need to purchase list, they are all listed right here for free. Applying is time consuming, you also need to be aware of some of their requirements as, E&O insurance, Liability, referrals, experience, etc. Many of the asset management companies are not accepting new applications and the ones that are have a long waiting list here in FL, being accepted does not guarantee listings for the same reason, thousands of agents on standby.
In the other hand, miracles can happen. When completing a BPO keep in mind to always conclude fair market value, do not use the lowest 3 sales you find in the section, a lot other people will tell you otherwise, NOT TRUE. If luck strikes you and the Asset Manager happens to notice the opinion of value you provided 3 months ago is 20% higher (to say the least) than their "preferred agent" the listing can be reassign to you if your application is in their system, it has happened to me twice, it has been the beginning of a great business relationship. Best wishes and patience.
Join some REO groups like NRBA, DSNews Force, Open Door Institute and participate in the conferences. Meet and greet. Network. Get personal recommendations. Doing BPOs is no longer the key to REO. It costs and even after you get in, it is very difficult to stay in. These lender and servicers merge and change business models all of the time. Good luck in Florida. I understand that it used to be that every other person there had a real estate license....