- SUMMARY: Host: Bob Mangold, "The Listing Coach."
- Podcast: Episode 48 of the If You List, You’ll Last podcast.
- Focus: Getting involved in the REO (Real Estate Owned) listing market.
- Interviewees: Jerry Stapp and Robert White, both experts in the REO space, sharing insights about the process.
Introduction and Key Points:
- REO Overview: The podcast skips the mortgage market update and focuses on REO listings.
- Expert Insights: Jerry Stapp and Robert White have extensive REO experience, discussing the good, the bad, and the ugly of the REO market.
- Lead Generation Tip: A simple strategy for using HUD-owned homes for lead generation is shared at the end.
Introduction to Experts:
- Jerry: Managed brokers for one of the largest REO lenders with over 20 years of REO experience.
- Robert: Started in real estate in 1986, specializing in REO from an early stage, currently working with over 44 banks.
REO Market Realities:
- REO Myths: Not all REO brokers make huge profits; it’s hard work.
- Foreclosure Market: Foreclosure "floodgates" are not expected like 2008, but some areas may see higher activity than others.
- Consistent Waves: Foreclosures will likely come in waves rather than a tsunami.
Getting into the REO Space:
- Building Relationships: REO is relationship-based, requiring time and effort to build connections.
- Starting Steps:
- Learn how to evaluate properties (BPOs, cash for keys).
- Create a marketing strategy that showcases your experience and capabilities.
- Apply to portals like ResNet, Equator, and Pyramid for BPOs and REO listings.
BPO (Broker Price Opinion) Importance:
- BPOs as a Key Entry Point: BPOs are critical for breaking into the REO space and demonstrating your competence to asset managers.
- Doing it Right: High-quality BPOs build your credibility with asset managers.
Logistics and Challenges in REO:
- Vendor Relationships: Strong relationships with vendors are necessary for managing REO properties.
- Receipts and Reimbursements: Always collect receipts and submit them on time to ensure reimbursement.
REO Listing Process:
- Step-by-Step:
- Accept the listing and check property occupancy.
- Report occupancy status quickly (within 24 hours) and handle BPO tasks accordingly.
- Follow the REO task list strictly to maintain a high score with asset managers.
REO Compensation:
- Typical Fees: Expect 1% to 2.5% per side (listing and buying agent), with some fees going to asset management companies.
- BPO Pay: BPOs typically pay $50-$75, but the real value lies in the opportunity to build relationships.
Additional Lead Generation Tips:
- Use Bank-Owned Properties: Advertise REO listings as "bank-owned" to generate buyer leads.
- HUD Homes and Open Houses: Leverage HUD properties to hold open houses, promoting them with signs and advertising to attract leads.
Preparing for the REO Market:
- Marketing Materials: Create a professional resume and marketing plan that demonstrates your ability to handle REO listings.
- Events and Certifications: Attend events like Five Star and NADP, and get certified in REO processes.
Building Your Database:
- Use Open Houses to Build a Buyer Base: Bank-owned open houses attract significant traffic, which can be turned into future business.
- Good Neighbor Next Door Program: A HUD program offering 50% off home prices for qualifying buyers (e.g., firefighters
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