http://activerain911.com/
So when we place properties on the MLS that are Bank Owned
Foreclosures, usually those properties are under market value. There
are several checks and balances that prove the previous statement -
Multiple Broker Price Opinions (one done by the REO Agent or someone
that is associated with them) and of course a full blown appraisal.
Knowing this going in and educating your clients will best serve both
masters. Furthermore make sure that you explain to your client if a
REO property shows active that may not be the case. There is a "lull"
period between the time a REO is placed on the market and the time
frame that the Bank is Overwhelmed with the Hundreds of other files it
is actively working on. Furthermore, there is the approval and
choosing process which takes time. We submit as we receive. But that
is not ordinarily the case.
What is also not ordinarily the case is we call back when incomplete
packages are submitted as offers on our REO properties. That is very
time consuming and most REO agents, I dare to say, as we represent
buyers as well, do not have the same courtesy in place.
What does it take to have a complete package? Explain this to your
client during your initial consultation to best educate and let them
know how this will help limit their frustration.
Submit A Complete Package:
Approval or Pre-Qualification letter - From the REO Agent’s lender as
well (this is a necessary step due to the Escrow Failing and those
attempting to purchase the property is so dependent on the REO Agent
themselves. There is a lot of Accountability in place so do this and
explain it to your client as a checks and balances for the Bank and of
no offence to them)
Proof of Funds even in your client is FHA
Fico Scores (this would help - but you can mark out any confidential
information regarding Social Security Numbers etc.)
Copy of the Deposit Check
Legible copy of the Purchase Contract (many banks are paperless or
going paperless)
Type the Purchase Contract if you are able - This help will the final
paperless product
After this package is submitted verify receipt. We utilize a Fax
obtained by Freedom Voice Systems. This is a clean way and it gets
uploaded and e-mailed to me, Paris and Jamie our office assistant.
If the REO is worth their salt the verification should be completed
within 24 hours.
Then it is now time to wait.
Also inform your client that is it not necessarily the case to find
out within normal "human" seller time frames and to be patient.
Furthermore, it is actually against the law to reveal the offers that
are received and have been submitted with regard to terms and purchase
price. Plus besides the "Legal" issue - It is very unethical.
Explain that there are others interested in REO’s and that they
deserve just as much of a chance obtain this property as your client.
Education is the name of the game when it comes to writing offers on
Foreclosure’s and REO properties.
Here is another hint - If you are working with an agent that is
nearby, you might drop off the offer and package in person. Then you
get a chance to see how we used to do real estate dating pre-fax
times. That way you can sit across from the REO Agent and see what is
the happenings with the property so you can tell your client you did
one above and beyond all of the other folks writing on that property.
If you are the offer chosen by the bank - Remember that they are going
to need this going paperless - So in the future it will be necessary
to have the originals returned to the bank. Just an FYI.
Repairs:
This is a trigger point due to some banks not even approving Termite
Work. We are blessed to represent a Bank that does not deny Termite
work to be done. They would not loan on a property that has termite
so they have us prepare all of their assets and get the blessing to
have the work done before escrow closes.
Financing:
FHA and VA have strict requirements when it comes to their appraisers
that go out to these properties. If it is a true "fixer" then it may
not pass via the FHA or VA guidelines - Make sure you inform your
client of this. Make yourself aware of those guide lines to do so get
it from the Horses Mouth, call your lender and have them catch you up.
Then when you have your introductional meeting - make sure you inform
them and you will then be the Subject Matter Expert earning a Client
for Life.
Working directly with the Listing Agents:
I have to say that this is a difficult spot. We do not inform as to
where we are when we get calls on our REO’s for sale. We cannot and
will not hinder someone that wants to buy the property even if we have
a chance to represent the buyer and double our commission. The world
is a small place. We were "normal" agents before this REO market and
will be at its conclusion. Also think about the bank, those Asset
Managers. If you are being up front, as we are, we make it very known
which offers we are representing the buyers on. AS should all REO
agents. I feel that this topic should be covered with your clients to
weed out the possibility and those thoughts creeping up that maybe
they should start working directly with the REO agent.
It is a long process. Some are easier than others. But we have
buyers that we have been working with for dozens of offers now. We
don’t stop. We continue with the hopes and and eventually something
sticks. Keep them motivated and never let them see you stress or get
discouraged. Through the passing on of information we can all make it
through this market and survive until the next one.
Connor MacIVOR
RE/MAX of Santa Clarita
http://connormacivor.remax.com/
The Paris911 Team
http://paris911.com/
25101 The Old Road
Santa Clarita CA, 91381
(800)760-6911
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