So you want to be a REO Broker? tips and secrets revealed

Hello everyone, I get frequent emails from agents who want to break into the REO listing business as they see my multiple answers and posts here on Trulia. The last couple of emails had me pondering how to respond...
 
i get some great questions, some heart felt emails and a few quite rude ones to be short. Todays email actually topped yesterdays.... which really had me scratching my head which has led to this blog post.

First i have been working on REO's since 1989. At the mere age of 22 and already 4 years of real estate experience under my belt, i was thrust into selling the local banks inventory. Then the feds came and started taking over bank after bank which allowed me to sell for the FDIC, RTC, FNMA and VA. With contacts i made there were several downturns as they are now called in the early 90's then late 90's and now the big one.

So getting to the point of these emails i get....

 Most ask for my "list" or my "secret contacts" or how do i get listings and they cant, or offering me a percentage of what they list if i give them my contacts, or begging for the information with a tear felt email so they can list reo homes as they are near losing their own home and need some quick sales. The there is the people offering to swap asset manager information from their contacts in CA for my contacts, (im in NH - CA contacts probabily wont help). And todays "poke in the eye" comes from a local broker in the area that demands....yes, demands... i share my information on how i got a specific listing as they were watching it vacant for months and really wanted to sell it and lastly that some nerve i have listing a home in their neighborhood and furthermore that i should sign the listing over to her/him becuase they have buyers. Well..... how can i answer that nicely, cant... or dont want to right now, so rather than unleash on someone who deserves it i have choosen the nice road.... 

But anyways... here is some things i would like to share with everyone....

1. First, there is no reason to pay for any of this lists or information that isl available for free.

2. There are no short cuts, there is no magic wand or secrets worth paying for.
 
3. Simply put it is hard work garnering experience by completing bpo's. There are companies that just do bpo's that do not assign listings, complete them, do a good job and get your name on them therefore out there to more potential asset mamagers. Then there are the companies who do the bpos and assign listings. I was told that on average 13 bpos will get you a listing. depending on your area it could be higher or lower. However i completed 187 for one company last year, end result 0 listings, this years resolution, no more jumping when they need a bpo done the same day that is 30 miles away. On the good end i completed 28 bpos for another and resulted in 2 listings. So you never know...

4. Most important to consider is that If you want to list reo properties make sure you have a seperate account of money to be able to pay for the upkeep, repairs, utilities and maintenance of these properties. i recomend at least $5000 to$10,000 as you will have to wait 30-90 days to get paid back. 

5.  You will need to make sure you have at least 3 contractors who can get you free estimates usually same day as they request and complete work for you when needed.

In conclusion

There are no short cuts, dont waste your money on lists. Get out there make a name for yourself by hard work and avoid the short cuts, they will lead you to a dead end and less money in your pocket.

updated july 27, 2010

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Blog Written by:

Scott Godzyk
Godzyk Realty Group