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Desperate Agents Raise Funds for Asset Management Start Ups.

Ok, this blog is going to cause a lot of friction however, please understand that is my goal. I really want to hear your thoughts, both the pro’s and con’s.

Our industry has a lot of REO / BPO Firms popping up out of no where making huge promises if only you pay 199.99 for their training / certification / designation. The problem is, most of these companies aren’t what they are cracked up to be.

In fact, it has come to my attention through an anonymous source that many (how much exactly I don’t know and neither did my source) of these REO / BPO companies using their “designations, certifications and training” as their start up capital vs. going out and getting real funding from a bank or private capitalist. Well, you maybe thinking, “what is so wrong with that?”…….let me explain!

These companies don’t intend to ever produce a REO / BPO for their agents…..that’s right, you read correctly.

What these companies are doing is putting together a list of Realtors who are “certified” then they shop that list out to a Asset Manager list they bought from a data source like, Datasource.us. In other words, they aren’t doing anything more for you than you can do for yourself!

Read their agreements very carefully. They say things like, “Participate in our Advertising Program or We Assist our Clients in Finding the Right REO Agent to Sell Their Listings or Lenders Choose from our Experience List of Agents….blah….blah….blah.

You never hear them say, “Mrs. Jane Doe Realtor Extrodinare, our client…ABC Bank has three REO’s we need to assign in zip code XXXXX so, can you work that for us?”

In other words, they never quantify, qualify or guarantee and, that is because they can’t…..your just another name on a list of hundreds, if not thousands of other agents that are mailed out to these AM’s and after reading over the latest edition of “Ask the AM” we know how far that will get ya.

So, what about that 199.99 you paid, what is that getting you…..NOTHING! In fact, rather than going out and raising start up capital like any other legitimate business, these people are pocketing your training fee and using those funds to keep their illegitimate business cycle a float. These people can’t get start up capital from a bank or private investor because they can’t prove they will ever produce a single REO / BPO. So, if that is the case, why in all of creation do you think you are ever going to get a REO / BPO from them.

Now, let me make one disclaimer. I work for a company who charged me a 100.00 training fee and yes, I have their “certification / title” but, I researched the hell out of that company before I paid them and now I can tell you, it was one of the best decisions I ever made. I won’t name the company in this particular blog but, if you know me well enough, you know what company I rave and support vigorously. If you dn’t know me that well…..read my blog archive, I have blogged about them several time and love them.

Now back on topic….so, as I was saying, many Realtors are paying these fees to never see a single REO or BPO only because, the company they signed up for never intended to produce a REO / BPO in the first place.

Even if they did go into the AM business with true intentions but, after 3 months, you haven’t gotten a single assignment, ask yourself…what is going on.

Truth is, with the high number of REO’s and BPO’s going on right now, to wait more than a couple of weeks for an assignment that cost you 199.99……..something is terribly wrong.

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Comment by CJ Oliver on May 2, 2009 at 8:38am
It's a real catch 22 inasmuch as the asset managers, especially Fannie & Freddie, won't give other agents a chance in their area as long as some undefined parameter of service is being provided. You take courses and build your portfolio of lenders who give you work but you end up still stuck in line waiting for the big boys. It's easy to see why some of these phony reo lead offers work on the uninitiated.
Comment by glenn mayernik on May 1, 2009 at 8:51pm
Default school is a legitimate company and is required by many banks to continue doing business.
I am 100% sure more and more banks will endorce their coarse and will be mandatory in the very near future
Comment by Jesus (Jesse) Gonzalez on April 28, 2009 at 4:53pm
Dear Sharon:

I can appreciate your support for the FSP certification however, to say, "There is ONLY one, 1 certification that is recognized by the Default Servicing Industry, and that is the FSP" is completely not true and, let me explain why.

The Default Industry has no accepted and or acknowledged governing body.

Granted, we have a few large and widely supported conferences, conventions and training seminars but, no governing body. Because of this fact, we have many companies that offer certifications that do offer substance in training as well as business. I don’t want to acknowledge any in this blog simply because I don’t want to appear as if I support one over the other however, our members have acknowledged a few and they appear on our main page under the title “ Popular REO Certifications, Designations and Memberships”

So, a more accurate statement would have been, in your opinion, there is only 1 certification that is recognized by the Default Servicing Industry and, that is FSP.

I make this clarification because we have a lot of new agents who read these blogs and I don’t want them to think Five Star Professional is better than NFSTI or that REOMAC is better than Five Star.

The truth is, many designations, certifications and professional memberships exist. Some are much better than others and, you have to make a decision for yourself where you spend your money.

The truth is, the Default Servicing Industry has no single accepted completely legitimized designation / certification. It still is a buyer beware market
Comment by Sharon Molnar on April 28, 2009 at 3:23pm
Res.net has a certification, REOTrans. has a certification but these certifications are only for the use of their system. I will tell you Res.net Certification has paid off for me this year, but I don't hold my breath. Asset management companies require you to submit reimbursement on one system and do the leg work on the other. There are other companies that will put together a list of Asset Managers, etc and will charge you an arm, let and an eye.

Join the REO companies that provide you resources and do not charge you a bunch of money to join. If they are reputable, they will ask for references, they check them out, and if you are not up to snuff, they will not accept your application. My .02 cents and experience
Comment by Sharon Molnar on April 28, 2009 at 3:17pm
There is ONLY one, 1 certification that is recognized by the Default Servicing Industry, and that is the FSP.
I have researched so many "certification" titles. That is the Five Star Professional designation.

This designation is supported by the major banks, as they put on and attend the Default Servicing Industry convention. This is THE place to meet and great, receive updates and training from the people in the industry.
This is THE REO convention of the year, and people attend to gain access to the VP's etc of banks, Freddie Mac etc.
Comment by Jesus (Jesse) Gonzalez on April 28, 2009 at 12:07pm
Hi Larry:

I am always a supporter of training however, I don't support paying up front for it. Not to give too much away but, I believe that if I am going to be trained on "your" system, getting "your" leads, closing "your" deals then why can't "you" take payment at closing?

I am a huge fan of paying for what you get and, not paying for what you might get. Pay on performance....why is this concept so hard for so many to understand?

I see it this way. Charge me the 499.99 and I will pay it on my first closed deal with ya. If you can't do that....then why would I ever take the chance I am ever going to get a lead when "you" won't take the chance that "you" will give me a lead in the first place?

REOTrans helps a lot of people but, this sounds like they are just jumping on the band wagon of, "let's milk these agents for everything we can". I am sick of it.

Personally Larry, I wouldn't pay for it...not a single dime. Especially after reading over the latest edition of Ask the AM......nope, I wouldn't pay for it at all.

On the other hand, if they want to take payment out of my first closed deal, using thier "training" then that is a different matter all together.
Comment by Larry Tristano on April 28, 2009 at 11:41am
Good Morning Jesse,

I see that ReoTrans now has a certification that you have to pay for ranging from $199-$499 which includes training through them on their system. Any comments from you or anyone else on this post?
Comment by Barbara McClelland on April 27, 2009 at 8:05pm
I agree....
Comment by Jesus (Jesse) Gonzalez on April 27, 2009 at 5:09pm
David:

I can't comment on any particular company but, I can tell you that the scenario I have outlined above is rampant in our industry and in my opinion, completely out of control.

I am reminded of a wonderful quote, "If the Asset Management company isn't confident enough in the lead to take thier fee at closing, why would you ever be confident it would actually close"

Granted, the quote is specific to leads but, I believe in the quote is a much larger idea that can be used regardeless if it's leads, zip codes, designations, certifications, titles or whatever else these Asset Management start ups can come up with.
Comment by David J. Nauman on April 27, 2009 at 4:44pm
Jesse,

Could one of those companies have a website that is ams4reo.com or something along those lines?

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