If you’re an aspiring REO agent – or if you’re a salty old REO guy from decades time forgot, it may be that you’re looking for some REO clients. If you’re new to the REO business, you probably don’t have any REO clients, or maybe you just got a one-off because you did a BPO somewhere along the way. And many seasoned REO brokers will tell you their volume is way down, and they’d love to have some new REO clients. It may be easier for the seasoned REO pro to get those new clients – but getting them is no sure bet for most of us out there.
If you read around the internet where REO agents (and many more aspiring REO agents) hang out (think LinkedIn, AgentsOnline.net, and REOPro) , you’ll hear a common angst-ridden wail: is it too late to get into the REO business? I remember when I got into the REO business full-time back in 2007, a lot of folks were singing that same doleful tune – that maybe it was even then too late to make it in the REO game.
That was three years ago, and while it’s been a roller coaster of a ride for much of that, overall my business has grown and matured, acquiring new clients along the way. I remember thinking back then that, at least in my local market, there was likely only to be an REO business for about 3 years. In other words, if you’d asked me back then, I would have said I’d expect the business to be rolling up by late-2010 – right about now.
However, in that time, I think it’s become clear to pretty much everyone that the housing market – and, crucially, the economy as a whole – are in considerably worse health than most people thought, myself included. What seems clear now is that we are at best half way through the REO extravaganza, but the likelihood seems to be strong that real estate will not resume meaningful appreciation any time soon, and that the low-, no-, and negative-equity positions many homeowners find themselves in and many more will soon find themselves in will continue to drive defaults and keep REO lisitngs coming on the market.
One thing’s for sure about the REO business: it’s dynamic as all get-out. Traditional real estate is sleepy by comparison to the REO world, where things move very quickly and it seems the only constant is that the whole industry is in a state of change. Of particular interest for the aspiring REO agent, or the old pro looking to pick up some new clients, this means that many servicers and outsourcers lose and gain clients (lenders, investors) all the time. As many a REO veteran will tell you, one client can provide a steady business for years, and then that client loses their servicing contract and with it the REO business – and the REO veteran can see the volume from that client drop to zero literally over night.
His loss is another agent’s gain, though – those REOs will go somewhere, to another servicer or outsourcer. And that servicer or outsourcer may not have a large or strong enough broker network in an area where those bad loans are concentrated, and in that way will all of a sudden will have need of a new REO agent. Even though their web site probably says they aren’t accepting applications, they may be actively recruiting agents – perhaps from within their BPO provider network, or perhaps through a web site like REONetwork.com.
I know this happens all the time – and I’ve got proof! Here it is: just today I was given an REO assignment for a company for which I have only heretofore done BPOs for. They’re a well-known player in the default servicing business, and I look forward to working with them on many REOs – but first I’ve got to work on hitting this one out of the park to hopefully begin cementing the relationship.
If you’re looking to jump on the REO bandwagon, fear not: the ship hasn’t sailed – it’s still there at the dock, taking on fuel – or taking on water, depending on your perspective. To be sure, it isn’t easy to break in and even harder to actually be successful at it with a stable client base – but it can be done, by those willing to pour on the time, energy, dollars, and effort.