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.