November 08, 2010
Our company handles a lot of REO transactions. For those unfamiliar with the term, REO is short for Real Estate Owned. (Many times we have another three-letter abbreviation for these properties (POS), but that's getting me off topic.) REO is the product banks take back via foreclosure, and is usually synonymous with distressed properties.
When we research the properties, we are given fairly short timeframes to perform our due diligence. Therefore, our best sources for information about these properties are the real estate agents who have (or had) the listing.
Most agents are friendly, engaging, and willing to help us get a better understanding of the properties. They fill us in on the neighborhoods, the curb appeal, and any red flags we should know about. Often, their descriptions of the property are the difference betweeen buying the property "right" or getting into a money-losing situation.
Last week, we were presented several hundred REO properties to bid, and given exactly one week to do our research. Considering it takes, on average, 15 minutes to locate the agent, call them, and document their feedback, it was simply impossible to think we could canvas all the properties. That doesn't mean we didn't try.
Hindsight is very valuable after last week's exercise. The day before our bid was due, I left messages for 27 agents that did not answer their phones when I called. On the message, I explained the purpose of my call, and included a promise I would take a minimal amount of their time. Any guesses as to how many called me back? Go ahead...guess.
If you said half, you're way off. If you said one-third, you're way off. TWO. I received two calls back from 27 agents I called. Now, I think I know why most didn't call back. The bank who owned the listed property pulled it from the agent for bulk sale. From the agent's perspective, there was no money to be made now that this property's listing was pulled.
Here's what those 25 I never heard back from DON'T know, and is probably one of the reasons so many agents are starving these days: We almost always re-list our REO properties with the original listing agents after putting money into the property and making it "move-in ready". Guess who we call if we end up with the properties originally listed with agents that didn't return our calls? Yep...the agents who picked up their phones or those select few who actually DID return our voice-mails!
I have no less than three examples this morning alone of agents who were friendly and helpful and who were the beneficiaries of listings their competing agents had before the REO sale. The difference? They answered their phones (or promptly returned my call), provided the information we needed, and exhibited market intelligence and savvy.
So, for all those agents out there who might get a call from me someday in the future: Pick up the phone! You never know how much business might result from it. Since going 2 for 27 on the voice-mails last week, I've decided I won't be leaving them anymore. Better to just move on to the next agent and save my time for the ones who want to do business!
Make it a great week!
PS For the gentleman who called me over the weekend and left me a voice-mail, one bit of advice: My name is Clint, not Clyde. There is no Clyde here, and he will not be returning your call. Know who you're calling if you expect the call to be returned!
Our efforts stay focused on note holders. If you are a note finder, a note
broker, or anyone other than the actual note holder, please do not contact