As the number of foreclosures rises, banks and lenders are looking for ways to sell these homes at fair market value in order to recoup some of their money. If they are unable to sell the home through an auction, then the property becomes what is called a real estate owned (REO) property. Real estate agents have an opportunity to work with banks and mortgage companies to sell these properties, but they must understand the basic principles of selling REO properties. Continue reading to learn become an REO listing agent.
Instructions
1. Understand the process of selling REO listings. As a real estate agent, you feel comfortable working with buyers and sellers, but when it comes to REO listings the process of selling them involves more details that you may not be familiar with. REO listing agents handle a variety of tasks for banks or lenders in addition to marketing and selling these homes. They are responsible for keeping the home secure, inspecting it and taking the necessary steps to prepare the home in a way that will result in a good offer. To successfully sell REO listings, agents must also understand the closing process, contract forms and regulations. There are a variety of books, training programs and online courses you can take to learn the basics of selling REO listings. Depending on how much money and time you want to invest in learning about REO properties, you can choose from any one of these options. Check your local library for instructional books on this topic, or ask your broker about training. You can also become a certified foreclosure specialist by completing one of the many correspondence courses available online. Check with your local Association of Realtors for more information on recommended courses. A link to the education resources offered by the National Association of Realtors is in the resources section of this article. You should also talk to other REO listing agents to get an idea of what type of training they would recommend.
2. Learn put together a Broker's Price Opinion (BPO). A BPO is a report that is used to analyze real estate market data and similar properties in the area in order to come up with the fair market value of a home. Banks use this information to determine the selling price of an REO property. They hire real estate professionals to put together these reports. Real estate agents are paid per BPO, but they also benefit from doing these reports because it helps them get REO listings. Due to the detailed information that a BPO contains, a real estate agent must understand analyze and use this information to come up with a fair market value estimate. You can get training on completing BPOs in the same ways you can learn about REO listings. However, it might be easier and cheaper to get help from an experienced REO listing agent working in your firm than it would be to take a course on BPO reports. There are also several books available that give you detailed instructions on complete these reports.
3. Sign up with BPO companies. A large number of banks and lenders prefer to use BPO companies to obtain BPO reports. BPO companies will handle all the details of obtaining accurate BPO reports, including contacting real estate agents in the area to complete the BPO request, checking the report and paying the agent for the report. As a real estate agent, you should sign up with as many BPO companies as possible to receive information about BPO assignments in your area. Your immediate response to any BPO requests in your area is needed to get as many assignments as possible. For each BPO you complete, you have the opportunity to establish yourself as an experienced agent who is familiar with selling homes in that particular neighborhood or area. This will also help put your name out there, so that the asset managers handling REO listings can contact you directly when they need to put a property up for sale. Some BPO companies also give the real estate agent who completed the BPO report the listing.
4. Register with a bank or an asset management company as an approved real estate agent. REO or asset management companies are hired by banks and lenders to manage REO listings. Through a nationwide network of real estate agents and brokers, these companies market and sell REO listings. To list REO properties in your area for these companies, you must call the asset management companies and provide them with your contact information. You will be required to show proof of a valid real estate license, a tax ID number, and errors and omissions insurance. Once you have been approved, you will be contacted as soon as there is an assignment in your area. You will need to respond immediately to any assignment notification you receive. Many times you will begin by completing a BPO report on a property before you can obtain the REO listing. Banks and lenders also give real estate agents an opportunity to sign up to be on a list of approved real estate agents. Once you are on this list, you will receive offers to list REO properties. All you need to do is request to be added to the list and provide proof that you are a licensed real estate agent. You can search for REO companies by looking them up on the Internet or by contacting banks to find out what companies they hire to handle their REO properties. You will also come across some websites and businesses that offer you a list of REO companies for a fee, but make sure to do your research and ask for recommendations from other agents before making this type of investment.
5. Network with people in the mortgage and banking industries. Sometimes the best way to get REO listings is to go out and get in touch with asset managers and those working in the REO departments of local banks. These are the people responsible for choosing which agents will list their REO properties. Contact the people you know in the real estate or banking industries and let them know you are interested in selling REO properties. Tell them about your training and experience with REO listings, and offer your assistance with these properties or with completing BPO reports. Attend real estate conventions in your area to make new contacts, and be prepared to ask for and give out business cards.
6. Accept REO listings. When you accept an offer to list an REO property from a bank, lender or asset management company, you will receive a listing contract. The contract will indicate what your responsibilities are as an REO listing agent. You will also be given a deadline to sell the home and specific instructions on what type of offers you can accept. Review the contract carefully, sign the documents and immediately begin by securing the REO property. If you have questions or concerns, talk to your broker before signing the contract.
