I just heard an incredible story that I don't know is true or not but, the point the story makes is going to be a key to any aspiring REO agents success and that is what I want to talk about.
So, Lisa the REO Listing Agent calls me wanting to know if I had ever heard of Rodger the REO Expert. I told Lisa yes, I had heard of Rodger. She stops me mid sentence and ask me if I think he is any good. I wasn't sure exactly what she was referring to so I asked her, good at what? Lisa tells me that Rodger is selling a program where he can get you into REO Bank of North America and he only charges $20,000.00.
After I picked up my chin from the floor I started laughing, it's only $20,000.00, I would charge more than that....I thought to myself. She asked me why I was laughing and I asked her, if Rodger guaranteed she would make her money back. She said on yeah, he told me he could get me in to REO Bank of North America in a couple of months when I join him and a representative of REO Bank at the conference in Dallas later in July. So, I asked her, did he give you that guarantee in writing? She said no however, he was sending over documents via email. I told her to call me when she got the documents.
So, a couple days go by, I heard nothing back from Lisa so, I called her. She got the documents, she was all excited, she was finally going to be in at REO Bank of North America in just a couple of months. So, I asked her, did he give you a guarantee. She said yeah, it's right here in these documents so, I asked he if she wouldn't mind letting me look them over for her, what could it hurt, having an extra pair of eyes, right? A few minutes later, I have the agreement .....and.....well, I didn't see any guarantee.
I called her up and I was like, Lisa, Lisa, Lisa, can you tell me where the guarantee is. She says, yeah, look at page 3, first paragraph......
I read it over and I didn't see any guarantee but I did see, a statement on their commitment to doing all they can to help her get introduced to a Bank of America employee.
I explained to her, what my thoughts on the agreement were and I told her, Lisa...one part of this you are not catching is something the Bank refers to as "Business Need". The bank, regardless of how experienced, nice, bubbly, and charming you are has to have a business need in your area before they are just going to add you to their ranks. Without that, regardless of how much you pay for access, you won't get in. Well, she just didn't want to hear that. Rodger the REO Expert had this big, nice agreement, had a nice car, was at all the conventions speaking, he had to have the inside scoop. In fact, Rodger even gave her references of others he had helped, 2 in fact. So, against my advice, off to the races she went. Paid the $20,000...all up front and now we are about 8 months down the road and she still isn't a REO Listing Agent...with anyone, Rodger is telling her that he is going to shop her out to a couple other banks.
Needless to say, she is beyond pissed off, that $20,000 she paid was her 401k she cashed out and here we are in the midst of tax season and she doesn't have the money to pay the penalty. She can't do much about Rodger, the agreement she signed was very clear and specific, all he was doing was selling access to one person....one bank and if that didn't work out...for whatever the reason, he would shop her around to others.
I guess she got what she paid for.
Comments
This sort of practice is frustrating for those of us like myself that have a legitimate business and work ethic. I never promise what I cannot deliver.
Sad...just sad.
I am NOT condoning this practice but i can see how this could happen. 2009 saw many markets dominated by reos. Agents who saw it coming and did the work to get the business are in high demand by asset managers and inspire envy in realtors who are not listing reos. 2010-2011 reo business dries up and many reo agents diversify to keep busy. Some are more successful as diversification than others. 2012 everyone thinks reos will again be plentiful, but they are not coming out as fast as many agents wish. Those who had the business in the past see a way to make some money by modifying a referral practice. I introduce you to a source of business and you pay me. Only in this scheme the source of business is the bank not a consumer, and the payment is up front. The agent paying the money thinks it is worth it to spend money for a referral. Again, I am not saying I condone this, I am just saying I can understand the thought process here.
The answer in my mind is for agents to get out and get their own business in what ever way they are best at doing it. I like the internet, some agents like networking, some are great at open houses. If we as agents would spend more time on the things that we are good at to bring in business, maybe there would be fewer agent who get taken advantage by others.
***UPDATE*** Well, I get up this morning and check my email, as I do every morning and guess what. Another story of this exact same thing happening but, on a much less grand scale. It seems to me that our industry is developing a segment where Realtors are hiring "REO Brokers" to get them into the REO business. I never imagined such a scenario in our industry but, apparently its happening. Obviously, not everyone is paying 20k but, it seems some are paying 5k without a second thought.
So, the scenario I got this morning via email was, Johnny "New Agent" wants to get into REO so, he attended a conference met with Rodney "REO Broker" who told him that he could introduce him to some bank executives at the upcoming REO Expo. All Johnny had to do was pay Rodney 5k, upfront and they would meet at an exclusive VIP party at REO Expo where Johnny would get to spend some quality time with these bank executives. Well, Johnny paid, 5k upfront and well see what happens at the REO Expo. As long as Johnny keeps me updated, I will keep you updated.
NOTE: Names have been changed for the protection of all parties involved.
My family's earnings? …20k gone? Rodger may have come up missing…That's a lot of money for someone to screw another colleague out of. This is just sad. I haven't been on REOPRO in a while and to come back to see this is astounding! I can not pick my face up off of the ground. Lisa I feel sorry for you and your situation. My heart goes out to you. I agree with Jose; Rodger should be called out so that this will not happen again!
20K!!!! Yikes.
speechless.....
I know I am preaching to the choir here, but how many times do agents have to be told they have to have a reserve of money to do REOs. If Lisa had to cash out her 401K account it does not sound as if she has the financial capital to try and break into REOs anyway. Shouldn't Roger have told her that.
Hey Jose,
"Lisa" is a member so, I will let her make that deicsion.
I think Lisa should call out Rodger here on this forum so at least the rest of new agents out there wont make the same mistake. I know there are a lot of scams out there, and we all need to be aware of them.
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