In the past six weeks, I have received several hundred emails from agents all over the country trying to get into the REO business or from existing REO agents trying to get more REO business.
First of all, most if not all lenders/servicers/outsourcers (LSO’s) are low on inventory and will be until the end of 2nd QTR of 2010. This is because of the change in accounting rules and Mark to Market valuation allowing future date values. They have to hold the REO’s for a period in order to use the future date values. This will lead to a controlled release of inventory.
Signing up over and over with the same LSO’s, or harassing various asset managers isn’t going to work and will actually diminish your chances of getting business.
The LSO’s already have more than enough experienced agents in their systems to dispose of the upcoming REO inventory. This is allowing them to trim off many non-performing agents at will.
While BPO’s are an incremental source of revenue. Short sales will more than compensate for the decrease in REO revenue due to the current shortage of REO’s. Short sale properties are in better condition that REO’s and will earn both higher sale prices and higher commission rates.
Your carrying costs for short sales is lower than REO’s and help reduce your overhead. You need smaller staffs, less office space, fewer PC’s as well.
Paying lots of fees in order to sign up for a bunch of agent directories and vendor firms is making them rich, but they don’t have any REO listings to give you. REO listings come from LSO’s.
You will have to sign up with the major online portals if you want to list REO’s, but you must also sign up directly with the banks. Now go back and re-read the 3rd paragraph. They already have enough agents.
So what to do? Go old school. List homes (short sales), re-learn how to work with first time buyers (all buyers actually have to qualify for a loan the hard way, and so will the house, FHA 203K anyone?). Go back to marketing your inner circles, your farms, previous clients, personal contacts.
