In previous posts I discussed bidding on REO listings and provided tips for making a successful REO listing presentation. This posts discusses tips for a preliminary interview with a lender that can help you create a listing presentation that will give you the best chance of being chosen to represent a lender’s REO inventory.
When you consider the complexities of getting a lender to seriously consider your buyer’s offer on their REO properties or even getting a listing agent to cooperate with you in the sales process, the best way to handle these challenges is secure your own exclusive inventory of REO listings. Currently there are many markets where inventories are low and the climate for obtaining these listings is intensely competitive.
Remember that in your role as a consultant, your job is not to have the answers to but to have the questions. When you are able to ask thoughtful and thought-provoking open-ended questions, you demonstrate your effectiveness with this skill. In opening up a conversation with a lender, you will want to ask them if it’s okay with them if you ask some questions so as to assist you in preparing a proposed marketing plan for their properties. You will most certainly want to allow them the time to respond and be sure to write down their responses as they provide them to you. As always it will be important to use the four key communication skills:
- Maintain or enhance their self-esteem.
- Listen and respond with empathy.
- Get them involved with their input on these issues.
- Set the agenda for the meeting.
Implementing these skills will ensure that the lender will give your presentation the proper consideration that it deserves. It will empower you to make a very favorable first impression with them. We have provided a patterned interview with suggested questions that you may want to ask the lender. Be prepared to be flexible with them though.
REO MARKETING PATTERNED INTERVIEW
- What kinds of results have you had so far in marketing your REO properties?
- What information would you like to see included in reviewing a Broker Price Opinion besides the information on your BPO form?
- What kinds of marketing approaches have you tried in marketing your REO’s?
- What are your expectations for the time frame in disposing of an REO property out of your inventory?
- What are your principal concerns in disposing of the properties in your REO inventory?
- What kinds of challenges have you encountered in the transactions with your REO properties?
- What do you expect of a real estate professional to make the process of disposing these properties easier for you?
- What are the expectations of your organization with regard to reducing your inventories of REO properties in the near future?
Your listening skills will be particularly important here as you write down their responses which will tell you the items that you will need to address in your presentation on how you can assist them in solving their problems. Be prepared to use the four additional components of your “Sample” Broker Price Opinion (B.P.O.) to address the concerns that they express to you, including:
- Competitive Market Analysis
- Competitive Price Lines
- REO Marketing Plan
- Marketability Evaluation & Checklist
As a general rule, at this time the six most common concerns that lenders have with these properties are:
- Time on the market – Most want to reduce their inventories of REO’s.
- Pricing Strategy – Lenders want to know the real situation with the market and are relying on you to show them. Lenders evaluate the quality of a BPO primarily on its timeliness and accuracy.
- Net Proceeds – Lenders need to minimize their losses with these transactions and you will need to show them how you will save them time and money.
- Marketing & Advertising – Lenders want to hear specifics from the agent about how they will market the property.
- Agent qualifications – Whether your company is small, large, or in between in size; or if it’s national or local, you have something to offer. Discuss your qualifications or your company’s in terms of how they will assist the lender in solving their problems.
- Minimizing inconvenience – You will need to demonstrate how what you will do will decrease the stress and anxiety and make the process for everyone easier.
Being prepared to address these issues along with extracting the answers to these questions will put you in a very strong bargaining position with the lender.
David Compton is a professional speaker/trainer, author and consultant in the real estate industry. He is a partner in Practical Resources; a company that specializes in delivering quality educational programs to real estate and mortgage professionals. He is also Director of Education for Eckley & Associates, a multi-state law firm with offices in California, Arizona, Oregon and Washington. In addition, he is the Director of Educational Programs for InvestorsAlly, a matching service for aspiring homeowners and joint property investors in buying homes. He has spent over 39 years in real estate in residential and commercial sales, site selector for a fast food restaurant chain, branch manager, director of education for one of the largest real estate brokerages in the nation, and since 1985 as a speaker/trainer. David is also a top-rated G.R.I. Trainer in Arizona and has been a featured speaker at both state and national conventions. He has developed over 200 real estate courses including over 25 online courses and has authored over 150 articles for real estate print and online publications.
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