Listing Agents Not Welcome.

By
Real Estate Broker/Owner with Liberty House Realty LLC

Because I have seen several recent post about OCWEN no longer taking on Listing Agents in CA. FL and, NV I decided to blog on a this recent trend of doing away with the Listing Agent.

Now, before I get started in on this topic, let me make something very clear, I have no first hand knowledge on these situations I will be discussing. I am simply putting together what I have heard, read and understood about the REO industries changing dynamics and how it might effect me or you.

Ok, so, OCWEN is no longer taking on Listing Agents for their properties in CA, FL and NV so, how is that possible?

First off, you need to understand that many of these disposition companies are trying their hardest to figure out how they can grab more and more of the listing agent commissions on these properties. Many companies are notorious for reducing commission, attaching high split percentages or adding un-necessary fees due from the listing agent. The terribly sad part of all this is, many listing agents have folded to these claims on their commission in order to simply close the deal and make something vs. nothing.

Well, these practices have led many companies to logically pursue these commission grabs to their conclusion by asking a simple but, dangerous question and that is, "How can we keep all the commission for ourselves?"

The natural answer to this is to do away with the Listing Agent and keeping the 3% average commission on that side of the transaction. So how can they do this?

Well, they aren't really getting completely rid of the Listing Agent. You see, instead of having 50 agents to cover a particular county, they reduce their agents down to 3 and then offer them a job to act as their agent, with a steady income and benefits like, retirement, health, dental, vision, paid vacation and more.

So how is this even possible, you may ask. I have one word for you and that is TECHNOLOGY! These companies invest lots of money in developing specific software that can almost manage the entire listing from birth to grave. This software is so highly developed that it can dramatically reduce the number of required agents to work the same, if not more workload than before.

Many REO agents are already using some of this software when you log into your Asset Managers Back Office and input your forms, update your work flows, etc.... All the company has done is taking that software and perfected over the years of use that you as a REO agent helped with.

Now, you're thinking, "What kind of Realtor would do this?" Well, I can assure you, plenty of Realtors are out there that would give up their commission and work for a company just to do the same job but have, regular income and all the benefits.

So....I know I probably just rained on your REO parade but, it's important for you to know this industry is changing. REO will not be the same when we end 2009 as it was when we ended 2008.

Good luck, stay safe and hopefully I will see ya on the flip side.

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Rainmaker
243,362
Highland Beach Condos David Serle
RE/MAX Services - Highland Beach, FL
Boca Raton Agent David Serle

Jesus, great post, and thank you for the insight.  I have heard of this, but still believe a commissioned agent would do a mch better job then a salried employee.  The banks will still need us.  Didn't the builders try and do this a couple of years ago.  The builders stopped paying not just listing agent commissions, but selling agent commissions.  Look what happened they are all back now paying whatever we want. 

Mar 09, 2009 08:04 AM #1
Ambassador
529,479
Mirela Monte
Buyers' Choice Realty - North Myrtle Beach, SC
Myrtle Beach Real Estate

Jesus:  This post is eye opening indeed.  Please post it to our Optimist Group.  (You can post the same blog to 5 groups).  I would like our members to participate in this discussion.

Good to see you here!  I am a member of your REO site.

Mar 09, 2009 12:05 PM #2
Ambassador
529,479
Mirela Monte
Buyers' Choice Realty - North Myrtle Beach, SC
Myrtle Beach Real Estate

The Realtor group should also have this post.  I believe it's a significant post worthy of attention.

I am flagging it for an AR feature.

Mar 09, 2009 12:08 PM #3
Ambassador
529,479
Mirela Monte
Buyers' Choice Realty - North Myrtle Beach, SC
Myrtle Beach Real Estate

Thank you Jesus for posting this on the Optimist Board.  It is now a featured post on our group. 

I would love to start a discussion here.  What OCWEN could possibly be doing makes much business sense.  Let's discuss what a local agent could bring to the table that the OCWEN agent couldn't!

Mar 09, 2009 02:03 PM #4
Rainmaker
146,020
Kate Wheeler
Country Homes and Land Murphy NC Realtor - Murphy, NC
CCIM - Murphy NC Real Estate for Sale

So many agents are bailing out of the business right now to find a place with a regular paycheck.  I imagine the company has been swamped with applications from some areas.  Let's not stick our heads in the sand - this business is changing and we'd better be prepared to deal with those changes. 

Mar 10, 2009 07:21 AM #5
Rainer
55,551
Kelsey Barklow
Hurd Realty - Johnson City, TN
423/948-9154

I had no idea that this is happening. Too bad. These guys will be less accountable for their actions now.

Mar 10, 2009 11:17 AM #6
Rainmaker
284,711
Gene Allen
Fathom Realty - Cary, NC
Realty Consultant for Cary Real Estate

They aren't looking for the most money for the house or the quickest selling they are looking for what is easy for them and it makes business sense to do it with 3 agents instead of 30.  They don't know how local real estate is and how prices are affected that way.

Mar 10, 2009 02:10 PM #7
Rainmaker
604,983
Brian Burke
Kenna Real Estate - Englewood, CO
Broker & Advising Expert-Denver Luxury Real Estate

I had not heard of this either, but then again we haven't seen that many REOs around lately, yet I have a feeling more is coming... at the end of the day it is number crunching for the businesses and I wouldn't be suprised if others would try to follow. I do feel real estate in general is in changing winds and we are doing all we can to adapt and stay ahead. ~Rita

Mar 10, 2009 04:09 PM #8
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Rainer
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Liberty House Realty LLC

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