As a listing broker, getting new leads is always a priority. However, REO and HUD listings (bank-owned properties) are a completely different ballgame than your average listing. If you manage to become a bank’s preferred listing broker, HUD and REO listings can be a lucrative and steady source of new inventory. Besides, it is an excellent way to attract investors and potential buyers who may be interested in purchasing a foreclosed home for a bargain.

However, it is not as simple as calling the owner and convincing them that you are the best guy (or gal) for the job. So, how can you become a HUD or REO listing broker? Here are the steps to follow to get access to these critical listings.

Apply to become an approved broker for government-owned properties

Two leading government agencies are involved with distressed properties: the Department of Housing and Urban Development (HUD) and Fannie Mae. If you want to be considered as a listing broker for HUD properties, you will need to apply to be approved on their websites.

They will contact you afterward if they are interested in your candidacy. They will then inform you of the procedure to follow if they need an agent in your area.

To become a Fannie Mae HomePath listing agent, apply here.

To submit an application to become a listing broker for HUD properties, apply here.

Contact your local banks and credit unions for REO listings

Bank-owned properties and REO listings are often managed directly by the lending institutions that now own them. Your best bet is usually to apply directly as they each have a different process for assigning a listing agent to a foreclosed property.

National banks may be challenging to convince since they already have an established network of trusted agents. Besides, many of them only do business with asset management companies to handle the volume of foreclosed properties they deal with. However, local institutions are sometimes easier to connect with.

Connect with Asset Management Companies who handle REO properties

Larger banks and lenders outsource typically outsource their foreclosure listings to asset management companies, who are in charge of assigning the properties to listing brokers, among other tasks.

In order to obtain listings from these companies, you will need to apply individually. There are hundreds to choose from, and their requirements in terms of experience but also their reputation in the business vary. They will typically require you to complete an extensive amount of BPOs for them before assigning you the first listing.

Complete Broker Price Opinions (BPOs)

Whether you are applying with a government agency, a lending institution, or an asset management company, you will likely have to do many BPOs before getting your first listing. In fact, Broker Price Opinions are a necessary rite of passage to show your experience and establish a relationship with the institution.

The more BPOs you do and the higher the quality of your work, the more likely you are to get a listing. Although they typically don’t pay much, don’t neglect them.

REO listings often come in waves, on an as-needed basis. Unfortunately, a good part of getting started as a listing broker for foreclosure listings comes down to luck and being in the right place at the right time.

When you want to renovate a house, time is often of the essence. For investors who are planning to flip a property rather than holding on to it, how fast you can rehab it will play a significant role when deciding whether or not to buy the building. In order to avoid losing money, you must be able to finish remodeling fast enough to avoid paying as much holding fees (property taxes, HOA fees, etc.) as possible.

However, answering the question: “how long does it take to renovate a house?” is far from straightforward. It can take from a few weeks to many months. As it is often the case with real estate, it will vastly vary depending on your circumstances, such as the type of property you are considering renovating, the work to be done, your knowledge of the subject, where you are located, etc.

Here are some of the things you should take into consideration when you are planning to renovate a building.

What is the scope of work?

How long renovation will take varies based on the scope of work to be done. Obviously, if the house is very big and needs extensive repairs, it will take longer than a small house which is slightly outdated. 

Each type of project to be done has a different timeline. However, those figures are only estimates. Each project will also take more or less time, depending on what kind of material you are planning to use. If you decide on a rare type of wood for the flooring, which may be difficult to source and lead to additional delays, should anything arise.

You will also need to take into consideration how much of the original structure you are planning to reuse. Although generally, it is best to remodel what is already there, in some cases, it is more time -effective to start from scratch.

The best policy is always to be conservative in your approach. Home renovation projects rarely, if ever, take as little time as one would hope. Make sure you have some flexibility in your timeline before starting a major renovation project.

Who will renovate the house?

Investors often play with the idea of completing some, if not most, of the renovation project themselves. However, unless you have a significant amount of resources and knowledge – if you are a contractor yourself, for example – the best policy is to hire someone. It will save you a significant amount of time and money in the long run.

The right contractor will make sure that the project is running smoothly and will keep you updated regarding the timeline of the renovations. Here are some factors to take into consideration when hiring a contractor:

• How big is the crew?
• Do they work alone or with subcontractors?
• How familiar are they with that kind of renovation? Do they have preferred vendors for some of the items needed in the renovation (cabinet, tiles, etc.)?
• How many projects are they working on at once?
• How often will they be on-site?
• Will the weather be a factor in that particular renovation project?

Promotional videos are all the rage when it comes to promoting your real estate investing business. It is an excellent way to reinforce your branding and reach out to potential clients and investors.

However, sitting in front of the camera for the first time can be intimidating. You will need the appropriate website platform for your investment company, as well as the right content to attract viewers.

Where should you start? If you want to use this new media to your advantage, here are ten videos you will want to make to promote your real estate investing brand.

Listing videos

Real estate investors often don’t have the time and ability to visit each property in person. Many of them live far away, and most have a full-time job. A video listing such as this commercial retail space allows investors to get a better idea of what kind of property you are dealing with.

Interviewing former clients and investors

Satisfied clients and investors are your best publicity. Set up a short interview with people who have worked with you before so that clients who are on the fence can get a taste of what investing with you could be like.

Introducing your partners

As a real estate investing business, you likely work with many different actors that take part in the transaction, from loan officers to contractors. Potential clients will appreciate knowing more about how you work and who you work with.

Tell your story

Investing in real estate is primarily based on trust. If you want your clients to trust you, what better way than to create a short YouTube video about yourself, your success stories, and how you got where you are now.

Real estate investing whiteboard videos

Whiteboard videos such as this one require very little material. They are an excellent way to cover topics that may be of interest to your investors and establish yourself as knowledgeable in the matter.

Investing case study

When a particularly successful deal closes, use it to your advantage. Make a YouTube video showing the ins and outs of how it came together and how potential investors can achieve the same results.

Q&A streaming session

Even accomplished investors often have questions. Organize a Q&A session and stream out as you answer their interrogations and maybe calm their worries about a specific point.

Introduce your neighborhood

In real estate, location is everything. It is particularly true when it comes to real estate investing. Your clients may not be familiar with the area you are servicing. It is up to you to convince them to spend their hard-earned money in the neighborhood. And what better way to do so, but to explain on YouTube why it has the best potential and added value?

End-of-the-year recap videos

As the year comes to an end, it is the perfect time to get on the highlights of the past year. Talk about your achievements, the things you want to improve, as well as your objectives for the new year. Your clients and potential investors will appreciate getting a rundown of what you have been up to in the past 12 months.

How-to and tips on investing

What do you do when you want an answer to a question? You Google it, of course! Videos have been ranking higher and higher in results in recent years. It is an excellent way to bring new eyes to your real estate investing company. A short video explaining common issues in real estate investment is worth a thousand words. It also pays off to film a brief recap of some of your most detailed blog posts.

Real estate has an excellent track record as a long-term investment. However, it doesn’t come without barriers, and the main one comes down to one thing: cold hard cash.

You need money to make money – or so the saying goes. It is particularly true when it comes to diving into realty investments. After all, as any homeowner knows, you need a significant amount of liquidity to purchase a single property, let alone several. For most people, their home is the biggest purchase they will make in their life.

Thankfully, there are many ways you can invest in real estate. Besides, some of them do not involve having to let go of your hard-earned cash. Here are some of the options you can explore if you do not have access to unlimited amounts of liquidity to make your first investment.

Apply for a loan that doesn’t require a down payment

If you can live in the property for a time, you may have access to government-backed loans that do not require a small or no down payment. Some of the most common ones include FHA loans, VA loans, or USDA loans. The property you are planning to purchase will need to satisfy some requirements as far as condition or location is concerned. They apply for single-family homes or small multifamily buildings with two to four units.

Use the equity from another property

You may already own a property (like your primary residence, for example) and have significant equity in the building. In that case, you can contract a home equity loan. It will then gives you access to this sum without having to sell your building. You can then use that money to purchase an investment property.

Rent-to-own properties

If you can negotiate with the seller, you may be able to obtain a “lease option” as you rent the property in the long term. You will need to get a legal “option to buy” from the homeowner according to which you agree to purchase the property at a later date for a previously set amount.

Find a private lender

Instead of contracting a loan from a bank or a credit union, investigate non-traditional options for a microloan. They can be issued by individuals (the owner of the property you are interested in purchasing, for example). You can also involve several investors (friends and family members, for example), each covering a portion of your lending needs.

Take part in a real estate partnership

You may not have enough to purchase a real estate investment alone, but what about joining other investors in a similar situation? Not all partnerships involve a financial contribution. You could also become a partner thanks to your skills, real estate knowledge, excellent credit score, and so on.

Find a motivated seller

Motivated sellers are more likely to agree to a non-traditional financing approach. By using a service like Need To Skip, you can get the contact information of homeowners who may be interested in selling their property at a discounted rate or for no money down.

Real estate wholesaling

In real estate, wholesaling consists of finding an interested buyer for a property under contract. You then sell it for a higher price before actually closing. Since no closing costs, down payment, etc. are involved, you can get away with investing with little to no money of your own. 

How much is your property really worth? You may have a decent idea based on your real estate agent’s opinion, your tax assessment, and your personal knowledge of the real estate market. Nevertheless, these pieces of information do not replace an expert’s advice. That is where a home appraisal comes in.

There are many times when knowing the value of your building for sure is necessary. An appraiser is a third party who can provide an educated, unbiased opinion of value. Therefore, he or she can prevent many future issues between you and the other parties who may have an interest in the real estate deal, such as buyers, sellers, lenders, heirs, authorities, etc.

Here is everything you should know about home appraisals.

When should you hire an appraiser?

A home appraisal is necessary whenever the value of a house is in question. You may need a mortgage to buy a home or refinance it. In those cases, the lender usually hires the appraiser. Much like a home inspection, it is one of the associated costs you should expect from purchasing a property. Rest assured to know that, even though the process can be stressful, it will protect you in the long run.

It is also useful if you are planning to sell your property quickly and want to know accurately how to price without relying solely on your real estate’s agent opinion. Unlike your Realtor who works for a commission, the appraiser has no personal or financial interest in the transaction.

You should also hire an appraiser if the property’s value could be involved in a conflict, settle an estate, a divorce, or dispute a tax assessment, for example. A judge will likely order for an appraisal if the house’s value is in question.

What does the appraisal process look like?

A home appraiser inspects the property and prepares a detailed report providing an opinion of value, using several comparable homes to support his or her findings. Since no two houses are the same, the appraiser will adjust each comparable property based on whether it is better or worse than the subject. For example, the location may be more desirable, or the house may have been updated recently.

Appraisers go through an intensive training and education process. They must also obey strict rules and guidelines. Not respecting these regulations could put their license in jeopardy.

Each report is prepared for a specific purpose, and it cannot be used interchangeably. Since a house value is subject to change, you may need to have your house appraised several times to provide an accurate value, especially if the housing market in your area is evolving rapidly.

How much does a home appraisal cost?

As it is often the case in real estate, how much you should expect to pay for a home appraisal varies widely depending on many factors. Where you live, the size and features of your house, your timeline, etc. all influence the cost of the appraisal. According to a 2019 study, the typical price range for a home valuation is between $311 and $404. However, a complex assignment could reach over $1000.