Hi Frank, just finished reading your blogs and tried to "chat" but I couldn't figure out how to "send". My husband and I are moving to Va in the next 4 mos. and we are working with a buyer agent from (insert top 3 company) Realty and have signed a contract. We aren't crazy about her and she is not listed as a REO agent. She is also not crazy about doing foreclosure work and is totally unorganized. We feel sorry for her because she keeps saying "you'll probably want to fire me" and she's in her XX's with many years in real estate. Have you any suggestions for us? We are doing most of the research and have paid to use Realty Trac.
By the way, love your blogs. Thank you. Matty
Hey Matty, I was online, I tried to chat back, dunno what happened.
"not listed as an REO agent" that doesn't really matter. There is no such thing (that I know of) as an "REO buyer agent." If somebody says that, that is just marketing. (or Realty Trac is making money letting Realtors advertise as such on their site)
She might not be crazy about Short Sales, my blog post on Short sales is a MUST READ. These are Fake listings that never close (in my area) and they mislead buyers and really mess them up. Make sure you read that.
As for "foreclosures" they don't exist up here. What does sometimes exist is "bank owned." A "foreclosure" is a word frequently incorrectly used. It actually means a courthouse auction of a property. But today the banks buy them back for what they are owed. So the courthouse steps are empty!
I don’t believe in Realty Trac, but maybe I am ignorant (would love to be corrected, and we can both learn). I'd be curious to hear your take on it.
I don't know one person that has bought from it. I think it is a scam, but I could be wrong. Also I don’t think they offer a buyer agent commission, so that could also explain her not looking into them. (but really, show me 2 or 3 on that site and I'll dig up info)
I suggest sticking with your agent a bit longer. You can use her and search via my site (no obligation):
www.FranklyMLS.com it will let you search for keywords like arlington REO (which means bank owned) or Arlington Bank Owned and it will find listings with the word "bank" in the remarks (otherwise they are very hard to find).
Just stay away from short sales unless they say "already approved by bank."
Foreclosures sound sexy, but if you are looking in Arlington or Alexandria, in my opinion, they don't exist. Watch the youtube.franklyrealty.com video with my agent that just bought a bank owned property. If "foreclosures" really existed, she would have bought one that way.
Sounds strange doesn't it? No foreclosures?
Here is the process as I know it.
1) Seller tries to break even at $400k
2) Seller gets foreclosure notice
3) Seller drops price to $300k, a short sale
4) Seller gets 5 offers.
5) Bank says "no way" or doesn't reply
6) Foreclosure on courthouse steps. Bank is owed $380k, they buy it at OVER what it is worth, and they take over the house at $380k (ie no point in you outbidding them)
7) They put it back on the MLS at $350k as a REO or bank sale
8) It sells in 1 week (sometimes for over list, so you better know your pricing and be ready).
Except for far out places like Manassas. Instead of #7, they have these huge 500 person auction houses (HudsonandMarshall.com) that will unload 100 homes. No inspections, nuttin. But they have 3 or 4 people bidding them up. I still plan to do an analysis on homes that sold in that auction to see if they are really better than a regularly listed home. I don't think so, but I could be wrong.
But up here in Nova, they rarely (don't) exist.
So your agent might not be conveying the message to you, or she might have said the same thing, but you might have needed to hear it from a 2nd person that wouldn't make money off of the advice.
Also don't disregard regular properties. They have to compete with the bank ones too. I have MANY clients that start off wanting this blue light liquidation, just to end up getting real and buying a home from somebody that bought it in 2001 for $180,000 and is willing to drop their price to sell it.
Right? A buyer buys for $500k in 2005. 2 years later, the bank takes it over for $400k, sells it for $350k. Meanwhile another seller bought for $200k in 1999. Guess what... they might also be able to sell near $350k.
Hope that helps!
- Written by Frank Borges LL0SA