If you are a home buyer in San Diego looking in the lower price ranges, you’re sure to be aware that the majority of the inventory available is either Short Sale or Bank Owned REO. It seems a bit like the wild wild west for many of the Clients that I am working with. Certainly the new “buzz words” are “Foreclosure Specialists”, “REO Expert” and “Experienced Short Sale Expert”. Don’t get me wrong, there are many hard working professionals out there that are just that, but for every one of them there are one hundred that are not!
So over the last few months I have noticed a trend of behaviors that these “experts” seem to have in common. See if any of these sound familair to you.
1. Never, never, never speak to anyone over the telephone or in person. Their preferred mode of communication is via e-mail to a free hotmail account or perhaps a voice mail system with 37 extensions; Hi you’ve reached the voice mail of John Doe, Certified REO Specialist and Hair Stylist. I cannot take your call today or any other day so please send me an e-mail. If you cannot send an e-mail stay on the line for regarding routing of your phone call which we won’t return anyway.
2. Never, never answer your e-mails, but always send urgent ones when requesting a counter offer or acceptance or asking for the Client to resubmit their highest and best offer!
3. Go down and purchase the cheapest key boxes available to mankind at Wallmart. Since the Sentralock lockboxes are rather costly with electronic tracking abilities for securing the property, they will want to place a key in a 3 digit box that could be cracked by a 3 year old. Also, never place the code in to the confidential remarks of the MLS printout for your fellow agent to access – leave a call in number to get the code – be sure to see habit #1. Also, if there is a screened security door, they are sure to only include the key for the door inside the locked security door.
4. Be sure to develop a relationship with a mortgage broker that works from his home garage or car and require everyone to “prequalify” your Client. This mortgage broker should be familiar and practice both habits 1 & 2.
5. Make up lots of addendums and forms or have the Bank supply them to you. Make sure that the addendums and forms change or amend the Purchase Contract so that a team of 27 lawyers would not be able to agree on what has really been agreed to. These addendums should be posted on their website in various unsupported formats (Wordperfect & Wordstar) or faxed to you in 5th generation copy. You may also choose to use a JPG file which is about 10 GB per page for easy downloads. Of course if they are not on the website go back to Rule 1 and figure out the correct extension. You should have at least 5 or 6 various forms on various size and color paper which all have to be mandatory for submitting your offer.
6. Never report the property sale pending to the Multiple Listing Service even with 25 offers on the table. Always be sure to leave a message on your answering machine that sale pending will be reported in a timely basis, and if the property is still for sale it will be active.
7. Never, never, never tell anyone that makes an offer that you have accepted another offer. Let the agent and Client discover their offer was turned down when you are showing the home again and the successful buyer is doing a home inspection (this actually happened to me).
Jeff –
This is a great blog! I recently had a listing that was under $400,000 that sold in less than 24 hours for over the asking price – all because it WAS NOT a short sale or foreclosure, and people are sick of the above mentioned agent tactics of today’s market. A short sale or foreclosure listing does not give an agent the right to not follow rules and regulations for being an agent in this town – I wish they would figure this out so that they could 1) stop frustating my clients 2) stop frustating their clients and 3) have a license in 2010.
Jeff –
This is a great blog! I recently had a listing that was under $400,000 that sold in less than 24 hours for over the asking price – all because it WAS NOT a short sale or foreclosure, and people are sick of the above mentioned agent tactics of today’s market. A short sale or foreclosure listing does not give an agent the right to not follow rules and regulations for being an agent in this town – I wish they would figure this out so that they could 1) stop frustating my clients 2) stop frustating their clients and 3) have a license in 2010.
[...] it gets like the old west, and I really have not seen anything quite like this in my career. Some less than ethical or experienced agents are soliciting these poor Sellers, and convincing them to list their home for a very low price. [...]
8. Do not ever, under any circumstances, accept electronic signatures even though they are legal. Insist that all documents bearing this new-fangled form of endorsement be resubmitted with original or “wet” signatures (presented in blue ink using a Pentel Rolling Writer only). Convey this requirement on Sunday night at 9:00 PM when the would-be buyers are asleep or in surgery along with a resubmittal deadline of 9:02 PM. Of course, documents etched into stone tablets are also acceptable.
Great post!!!!
8. Do not ever, under any circumstances, accept electronic signatures even though they are legal. Insist that all documents bearing this new-fangled form of endorsement be resubmitted with original or “wet” signatures (presented in blue ink using a Pentel Rolling Writer only). Convey this requirement on Sunday night at 9:00 PM when the would-be buyers are asleep or in surgery along with a resubmittal deadline of 9:02 PM. Of course, documents etched into stone tablets are also acceptable.
Great post!!!!
Jeffrey,
Here is how we are trying to help simplify selling REO’s. Selling houses in “as-Is” condition seems like a quick and easy way to clear the inventory of bank-owned properties. Despite the “As-Is” agreement, unexpected defects turn up in inspection reports that cause the buyer to reconsider his offer. Properties then go back on the market to wait for subsequent offers.
More and more successful REO listing agents are qualifying buyers by requiring them to perform inspections prior to submitting bids. These listing agents reduce lost sales because all buyers are fully aware of the condition of the house when submitting bids. But this is still a time-consuming process as the buyer and listing agents have to wait for the inspections to be performed. It is also a waste of money as each buyer must hire an inspector at an average cost of $375 – $400 per inspection.
Our REO Pre-Inspection Program closes the gap between pro-active agents who want to qualify bids, and buyers who don’t want to spend hundreds on an inspection for a house they may not get. We inspect the REO properties AT NO COST TO THE LISTING AGENT. We perform an inspection and immediately upload it to our website. The inspection reports are available for immediate download for a greatly reduced price of $99.
Benefits to REO Listing Agents:
Eliminates negotiations after bid acceptance
Removes inspection from contingency period
Shortens sales cycle
Increases ratio of legitimate bids
Enables REO listing agents to require due diligence prior to submitting offers
No cost to REO listing agent
Saves buyers money
Buyers can evaluate more homes and may make offers on multiple houses
No added disclosure requirements – We don’t give you a report
This inspection program is so unique, we have been issued a provisional patent. To find out more about it, please visit our website and find out about our great services.
Jeffrey,
Here is how we are trying to help simplify selling REO’s. Selling houses in “as-Is” condition seems like a quick and easy way to clear the inventory of bank-owned properties. Despite the “As-Is” agreement, unexpected defects turn up in inspection reports that cause the buyer to reconsider his offer. Properties then go back on the market to wait for subsequent offers.
More and more successful REO listing agents are qualifying buyers by requiring them to perform inspections prior to submitting bids. These listing agents reduce lost sales because all buyers are fully aware of the condition of the house when submitting bids. But this is still a time-consuming process as the buyer and listing agents have to wait for the inspections to be performed. It is also a waste of money as each buyer must hire an inspector at an average cost of $375 – $400 per inspection.
Our REO Pre-Inspection Program closes the gap between pro-active agents who want to qualify bids, and buyers who don’t want to spend hundreds on an inspection for a house they may not get. We inspect the REO properties AT NO COST TO THE LISTING AGENT. We perform an inspection and immediately upload it to our website. The inspection reports are available for immediate download for a greatly reduced price of $99.
Benefits to REO Listing Agents:
Eliminates negotiations after bid acceptance
Removes inspection from contingency period
Shortens sales cycle
Increases ratio of legitimate bids
Enables REO listing agents to require due diligence prior to submitting offers
No cost to REO listing agent
Saves buyers money
Buyers can evaluate more homes and may make offers on multiple houses
No added disclosure requirements – We don’t give you a report
This inspection program is so unique, we have been issued a provisional patent. To find out more about it, please visit our website and find out about our great services.
Just jumped in this game and wow the above really describes the offer process and the response we’ve recieved from the REO Specialist a VP what a joke!