Buyer’s don’t trust sellers, sellers don’t trust buyers and it’s no wonder why! 95% of the people in this business are full of sh!t.
It’s a real problem in today’s market. My seller’s don’t want to proof up to my buyers because 95% of the buyers can’t perform. My buyer’s don’t want to proof to the sellers because most of the sellers aren’t real, they are just rehashing old product.
“Seller’s” are taking existing tapes, marking them up to crazy prices & then trying to market them. Or, better yet, inflating the BPO values to 2005 levels! I had one tape come across my desk where some of the homes were listed for sale on the MLS at $39K & the BPO value was listed at $140K!
“Buyer’s” say they want the product, send me the contract, meanwhile they are trying to flip the tape & make double the money.
“Intermediaries” believe they deserve 1% of the package price simply for providing their source, which is their friend Bob that knows the seller, but Bob is really friends with Tim who knows Sam who knows Tom who is the guy that actually works at the bank.
Buyer & Seller Reps play an important role in this business. They insulate the real sellers/buyers from all the pretenders out there. It is their job & responsibility to vet buyers & sellers & ensure they deliver real product. They may go through 10 or 15 “deals” before they are able to match their buyer or seller with what they are looking for.
So the question becomes how do you separate the real from the fake? How do you succeed in this business?
- DO NOT BE GREEDY! GREED KILLS MORE DEALS THAN ANYTHING ELSE!!!
- Be Honest, if you are not direct state it. When it’s time for the fee agreement to be signed everybody will know your true role, why not disclose it up front? Honesty is refreshing in this business.
- Do your research & your due diligence. Research that tape when you get it, use available resources to perform quick value checks.
- Vet your buyers, make sure they are real.
- Vet your sellers, make sure they can get “real” product.
- If you are an intermediary, make the introduction & get out of the way. Daisy Chains do not work & greed will kill every deal. If you made a phone call or forwarded an email do not expect to be paid 1% of the proceeds.
- Sellers Rep? Don’t be greedy & expect to be paid 2% or 3% because you know the seller. The buyers have the real power and typically will not pay more than 1% to the sellers rep. Don’t try to hit the grand slam every time, singles will win the game.
- Buyers Rep? You hold the power, the buyer decides who gets paid & how much. Again, don’t get greedy, 1% is fair compensation for your efforts.
More soon……….
I hope you will find our blog both fun and informative and I look forward to your input. Our industry is constantly changing and there are some big changes on the horizon.
Recent foreclosure moratoriums by some states, the FDIC, Fannie Mae and Freddie Mac have created a shortage of Bulk inventory in some states leading to a big increase in prices. As these moratoriums end more property will come to market restoring the balance between supply & demand.