Unethical REO Listing Brokers & Agents, How many do you have in your city?

By
Services for Real Estate Pros with Pacific Servicing

I wrote a blog on this a long time ago, and sadly, the topic comes up again as I sit here tonight listing out all the reasons I really wish to bring this topic back to light once again

Our market is still an REO driven market, we still have about 25% of all active listings in our area being either REO or Corporate Owned homes. Over the years, the hitters have been "swapped in and out" as they gain and lose major clients, but when the dust settles, the same issues still exist with the major REO Brokers and agents in this area, and honestly, I would be shocked if it didn't exist in your hometown.

I only wish the banks could see how the agents they choose to hire conduct business. I wish they could see the tens of millions of dollars they lose anually due to these unethical listing agents. Now, I am sure you would like me to explain exactly what the agents do that have half the buyers agents in my town in a total UPROAR, so please enjoy the bullet point presentation below.

  • The Infamous Double End. They love to pull this card. You will have a home listed at 200,000. They will have outside offers in up to 250,000. Yet, surprisingly, everyone gets the same "Rejection email", assuming the agent is even nice enough to send you a rejection email! You follow the listing, only to see it close 3-4 weeks later at...... WAIT FOR IT..... $200,000! SHOCKER! And what's even more amusing, they think because they put "Out of Area Agent" as the selling agent on the MLS, that agents are to stupid to figure out they were the ones who sold it. 
  • The "Take 2 weeks to even acknowledge they received your offer. Often times, I have agents submit offers on my companies behalf, and it has become rather customary to not expect so much as an acknowledgement for weeks on end. Again, I am not sure how the banks don't care about this, so I will assume they know nothing of this, but in my opinion if it takes you more than 24 hours to simply acknowledge an offer, you should be FIRED ON THE SPOT!
  • The "I refuse to submit your offer because you didn't approve with my best friend the broker... ERR I mean lender". I love this one. The listing is a Chase bank listing yet they ask you to approve with John Doe with 123 lending. Even when your buyer is 20% down, conventional financing, approved with a reputable DIRECT LENDER, they still REFUSE to input your offer into the seller's portal, something that again, they should be FIRED ON THE SPOT for!
  • Here is my favorite and newest one! The "Your offer is less than my seller will want to see, therefore I am not submitting it". No, this was not a misprint! I actually have seen this response sent to my preffered agency, SCA Real Estate, Tom Bashe Broker. The listing agent refused to submit a $220,000 cash offer on a listing listed at $245,000! I'm sorry, but you should have charges brought against you by the seller for not doing your job! It is NEVER your call whether to submit an offer to the seller. You are not the offers GOD. Your job is to get your clients home sold! Not your job to pass your own judgements on offers that come in!

I am sure there are many many more examples of this throughout the country, so please share! Nothing IRKS me more than REO listing agencies that can't manage to do their job correctly, and when their "games" they choose to play cost their clients tens of millions of dollars throughout the years, someone NEEDS to put an end to it! I pray all the major banks get this blog, and start taking a better look at the agents they choose to use.

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Ryan Case - Partner

Pacific Servicing, LLC

Ryan@PacificServicing.com

(800) 313-9050 - Office

(951) 760-3170 - Mobile

(951) 501-2926 - Fax

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Groups:
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ETHICS and the REALTOR
Investors
Almost Anything Goes
Foreclosures, and the future of our market.
Tags:
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Rainer
78,789
Dee Bundy
Fort Collins Realtor @ C3 Real Estate Solutions - Fort Collins, CO
Helping You Make Colorado "Home"

I haven't encountered this myself but have heard plenty of stories.  It seems like those that have dealt with it are struggling to find an outlet and I wonder what options there are to remedy the lack of accountability. Here's hoping that enough 'buzz' will spark something good.

Sep 14, 2010 03:38 AM #62
Rainer
130,836
Andrew Martin
REMAX Accord - San Ramon, CA

Ryan,

Great post. I see this all the time in my area. I also hate when you try to call the REO agent and you never get a live person. Then the house goes pending and surprise, it's an out of area agent.

Luckilly, were not see any REO's right now, so all of the big REO agents are sitting on their hands (although they already made their millions for the year so they don't care), but at least we don't have to deal with them.

Sep 14, 2010 03:40 AM #63
Rainer
230,494
Stephanie Reynolds
Integrity First Financial Group, Inc. - Santee, CA
East County San Diego Homes 619-838-4408

This is happening way too much. How in the world these people continue to operate is beyond me. Every experience should be reported to the Department of Real Estate. Enough complaints and enough noise will force them to investigate.

The sad thing is there is a comment here from a consumer who has had this happen to them. The reputation of us that chose to do business honestly, fairly and ethically is on the line when this type of behavior is allowed to continue.

Sep 14, 2010 03:48 AM #64
Rainer
30,892
Ryan Case
Pacific Servicing - Temecula, CA

Comment 64 (Danielle) - I truly hope this makes its way to the bank's asset managers

Comment 65 (Andrew) - We have that here, agents RARELY answer the phone

Comment 66 (Stephanie) - Yes, it just hurt the industry as a whole!

Sep 14, 2010 03:54 AM #65
Rainmaker
192,049
Gregory Bain
Mezzina Real Estate & Insurance - Little Egg Harbor, NJ
For Homes on the Jersey Shore

Unethical? You mean when they lied on the application stating they had a ton of experience and then a friend/mortgage officer signed off on it. Or, do you just want to talk about how they conduct their business once they have gotten banks to assign the listings? "REO and Short Sale Specialists - the making of a lawsuit", coming to a theater near you.

Sep 14, 2010 04:06 AM #66
Ambassador
1,154,258
Bryan Robertson
Los Altos, CA

These issues have come up in this years C.A.R. association meetings.  They were brought up because of signage - REO agents putting signs up when they had just a general listing agreement or no listing agreement.  They then ignore calls from agents but take calls from buyers all day long.

Unfortunately, the conclusion within C.A.R., after discussions with attorneys, is that we can't nail these agents (not all are Realtors) on the merits of MLS or sign violations.  However, we can nail them on ethics violations or violations of the state business code.

I encourage anyone who sees these practices occur to report the agents to the local board, MLS, or local AG.  These practices will hurt our clients and industry if allowed to continue.

Sep 14, 2010 05:05 AM #67
Rainer
137,004
Brent & Deb Wells
LivingWell Properties - Prosper, TX
Prosper TX

Ryan - There will always be people that try to cheat or 'bend the rules' if you will. It does not make it right and we need to always report these folks. It makes our whole industry suffer. Not presenting a valid offer to your client should cause you to be reported in every MLS I have ever heard of. Report them...

Sep 14, 2010 05:16 AM #68
Rainer
30,892
Ryan Case
Pacific Servicing - Temecula, CA

#68 (Greg) I totally agree. But lying on an app vs. costing the banks millions is very different!

#69 (Bryan) We do report, nothing ever happens

#70 (Brent) Again, we report, but nothing gets resolved :(

Sep 14, 2010 06:01 AM #69
Rainer
47,522
Peggy Noel
RE/MAX Commonwealth - Chesterfield, VA
Bouchard, ABR, CDPE, SFR

The more things change, the more they stay the same - I'm sure we all have some eyeball popping REO stories to share.

Sep 14, 2010 07:19 AM #70
Rainmaker
251,250
Joel Weihe
Realty World Alliance - Wichita, KS
Helping you to use your VA home loan benefits

I have a buyer purchasing a home across the street from a foreclosed home here.  No sign in the yard but a lockbox on the door.  Figured it was normal pre-listing clean up and inspection stuff.  But as I've been over at my buyer's proposed home several times, there's been an agent show up (they had their company name all over the car), and show the home to various folks.   Home is not on the mls and there's no sign.     It's annoying to think that it's not going to get a chance at fair market, because she wants to double-end the deal.

And I've seen plenty of them go on the market straight into pending the same day.  Check back on the closing - yup, double ended.

Sep 14, 2010 07:56 AM #71
Rainmaker
339,178
Chris and Berna Sloan
Group 1 Real Estate - Tooele, UT
Tooele UT

It's happening everywhere. I'm not prepared to say "most" REO agents are unethical. I don't have a problem saying that nearly all in my area have forgotten what the word "fiduciary" means. I know you feel that your complaints are going no where, but you need to keep at it, and add the Real Estate Commission, or whatever body governs licensing in your State. Karma will catch them all eventually. Hope it's sooner rather than later. GREAT POST!

Sep 14, 2010 10:42 AM #72
Rainer
21,818
Sara Davalos
Realty World REC - Miami, FL
Real Estate Consultant in Miami

Brokers remarks: Please email your offer only 1 time to:  offers@xxxxx.com

3 days after full price cash offer was submited, I get this email from offers@xxxxx.com "Please follow directons on MLS attachments-do not send offer to this email"

I replied: "offer sent as per MLS instructions" so what do I do now? no reply

Called the agent's tel number 500 times....  no answer (we gave up)

10 days later I get an email: "Thank you for your offer however the seller has selected another offer. Thank you."

 

 

 

Sep 15, 2010 01:29 AM #73
Rainer
264,127
Bill Travis
Captain Bill Realty, LLC - Gilbert, AZ
Broker/Owner

Leanna # 47 here is the url to the REOPRO network. I thought I put it on my earlier comment but must have forgotten.

http://reopro.ning.com/?xg_source=msg_mes_network

That forum has Asset Managers and Attorneys who participate. You'll probably have to join but it's free, and there's a lot of information on there.

 

 

Sep 15, 2010 02:47 AM #74
Rainer
30,892
Ryan Case
Pacific Servicing - Temecula, CA

Peggy - So True!

Sheree - that happened in my neighborhood as well!

Chris - Yes, Karma will catch up!

Jim - Reporting them seems to do nothing

Sara - thats the story for about 90% of our REO agents here, thats how they operate

Val - I will check out that forum :)

Sep 15, 2010 03:57 AM #75
Rainer
163,254
Ryan Case
SCA Real Estate - Anaheim, CA
877-828-0710

What we need to do is find contact info for the banks they work for, and report them to the CEO, CFO, and on down the line!

Sep 15, 2010 04:22 AM #76
Rainmaker
41,801
Kimberly Moore
Chase International - South Lake Tahoe, CA
Why Settle For Less When You Can Have Moore

Wow! 79 comments!  This appears to be a HOT subject! I AM an REO agent and I mostly represent Chase properties.  I have been in Real Estate for over 7 years. Unbelievable, the process to which an agent gets accepted to represent REO Properties is quite exstensive.  Why oh why would a legally bound agent represent any client in such an unethical way?  GREED!  Pure and simple.  Anyone can report an agent to the broker, who in turn should have info as to how to get to the REO Manager or asset manager!  That should help stop this ugliness!

Sep 15, 2010 08:03 AM #77
Rainer
12,628
Andrew Bloch
Ocean Beach, CA
Ocean Beach Real Estate | Photographer | OB Photography

There are unethical REO agents & Brokers in every city. The key is to report them to the proper board, and to the banks!

Sep 15, 2010 09:11 AM #78
Rainer
177,550
David Evans
RE/MAX TOWN AND COUNTRY - Cumming, GA
HUD NLB Cumming GA

It is true they are in every city. I see no policing by the reo managers or banks. THAT is where it would be most effective. It appears to my reflection that the banks do not care how these assets get sold and they protect the listing agents because they do not want to do more work... It is always the way with the banker bureaucratic mentality. They are up there and they can not be bothered with our concerns to clean up the good old boy network, I am told "unless you have evidence of wrong doing" they say when you try to bring it to them. The devil is in the details, why is it that most of the assets these offices handle yeilds more than easily explainable double ended transactions? To many of the same buyers? Maybe it is that their sales force is is really that good!?

Short of hiring PIs we must just live with fact that it is crooked and take the lumps that go along with ALL that power these thugs have in what could be a fair and equitable business in which money could be made by all. It seems like it would be quite right though if the listing offices were semi reviewed and tested by their oversighted lenders.

That will be the day! 

Sep 17, 2010 10:49 AM #79
Anonymous
Dory

My husband is a realtor here in Orange County CA. He works HARD for his clients and family 12 hours each day 7 days a week. In this economy he cannot afford to miss one phone call.  We have lost so many commissions because of unethical, greedy REO listing agents that feel empowered to continue their deceitfull ways because the buyer's agents allow them to do so. My husband has filed a complaint against a REO listing agent and the hearing will be later this month (April 2011). This agent has double ended 30% of her listings in the last 12 months. Honest, hard working realtors need to band together and file complaints with local boards and the state.  Once word gets out that they will be held accountable for their unethical actions we will see a change.

Apr 04, 2011 08:12 AM #80
Anonymous
Alan

I'm in Orlando and we have a huge problem with ethical behavior with these REO agents, there are 2 agents that have the bulk of the listings and in the past couple years I've made at least 15 -20 offers with one of the agents, most of the offers I presented to this one agent were cash offers close to if not full or even over asking price and I've yet to close one deal with that one agent. My wife has closed once with that one agent but she physically had to go to that agents office and made a stink at the front desk asking why he didn't return her calls and emails embarassing him. He basically lied and said that his office had problems with the internet and his phone, she phisically handed him the offer and told him it is an over asking price cash offer and she will be following up because the purchase was ours. We did get the property but that shouldn't be the way Real Estate should be conducted. Because we work near Disney we have a lot of foreign investors and second home buyers,  when ever we talk with new buyers for the first time we have to warn them about the practice of these certain agents, they've been reported and all we're told is there is a 2 year wait on complaints to be addressed and we're made to feel that we're lucky the banks sell them through us. As I type this I just got a text from an REO agent, I submitted an offer on Saturday to her email address, called her to let her know she has an offer on her email address, this text she just sent me is instructing me to send the offer to another email address because the one on the MLS she never checks, it is a $100 over asking price cash offer, we'll see if I get it or not.

Aug 01, 2011 03:26 AM #81
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