10 Reasons Not to Take REO Listings. This is My Liberation Day.
Today I closed my last REO listing and I will no longer be an REO agent. After a long thought process about the tremendous amount of work an REO listing takes, I stepped out a few weeks ago, wised up and decided I was done.
Several opportunities for these listings have come up in the last 3 weeks and each time I was able to share my reasons for no longer being interested in taking these listings. I even had one asset manager tell me she totally understood. Now that is a telling response. Here are the 10 reasons not to take take REO Listings. This is My Liberation Day.
- The commission is less than you can make on a traditional listing.
- You have to subscribe to their billing services and workflow systems to be able to play with REOs. One company alone costs $700 annually.
- You have to start working on them long before the listing takes effect and many times it never does or they cancel the listing.
- The REO companies asks you to be the bad guy and make the people leave that are living in the property.
- You get to negotiate the payment for the Cash for Keys and convince the occupants to move. Sometimes you even get to front the money (in some situautions it has been $3000) and hope to be repaid in 90 to 180 days.
- You get to hire vendors and pay for them to do immeditate repairs, the trash out and clean up, and ongoing services like lawn care, pool service and utilities. Again you have to bill the asset company and hope you get reimbursed. Some of them require you pay to submit your bills for reimbursement.
- You will do tons of photos and provide reports and market data to help them establish a list price. Most of the time they will disregard your data and do what they want to do anyway.
- Weekly, you will make routine inspections of the properties and send them time dated photos and written reports proving you have been there.
- They will send someone to inspect the property to check up on you because they don't really trust you to do what you have been saying you are doing.
- When the asset manager counters back, you will be admonished to not lose the buyer as if it was your fault that the asset manager didn't move much on the price and scared the buyer off.
For those thinking this is a pot of gold niche in the industry let me recommend you take your time and money and invest it in other areas of the market. Your time will be better spent. These 10 reasons not to take REO listings are proof. This is My Liberation Day.
For those of you agents that think this is just what you want to do, well here is your opportunity. There is now an opening in my market area. Have at it!