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Fannie Mae Secret Shopper Program | How-To LOSE Your REO Listings

 

All I can say is "It about time"!  Fannie Mae is cracking down on REO listing agents who are not doing the job they are hired to do. 

They are several REO agents around here that are great to deal with.  But there are several that just really stink.  No lockboxes on property or lockbox codes not listed so I cant access the property, knee high grass, filthy houses... the list goes on.

 

 

Thanks to ‘REO Listing Agent X’ for sending us this recent email from Green River Capital.

Hats off to GRC for cracking down the less than professional and ethical REO listing agents.

REO Listing Agents: Be warned, Fannie and Freddie are cracking down on their asset managers (GRC) to improve their results. Be certain that asset managers will be firing existing REO listing agents wholesale as we enter this next phase in the real estate crash.

Upside to this?

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“……we have expanded our investigative programs to provide real time feedback and help us remove any consistent violators from our Agent Network..”

“…..If warranted, reassign all assignments and remove the Listing Agent from our database….”

Dear xxxxxx:

I would like to follow up on Rebecca Smiths’ email dated June 15, 2010.   Rebecca’s email related that FNMA had initiated a pilot “Secret Shopper” program to review your level of “knowledge, responsiveness, follow-up, professionalism and effectiveness”.  The email continued that FNMA was not satisfied with its initial findings and had expanded the program nationwide.  The results recently shared by FNMA to Green River Capital (“GRC”) were disappointing to say the least.

It’s now appropriate that we remind you of the most basic Agency Duties you owe to any Seller or Principal, including GRC.  These “Common Laws of Agency”* include (but are not limited to): “Care, Obedience, Loyalty, Disclosure and Confidentiality.”  Please note the basic definition for each “Common Law”:

  • Care—“The agent must exercise a reasonable degree of care while transacting the business entrusted to him or her by the principal.”
  • Obedience—“…the agent is to act in good faith at all times, obeying the principal’s instructions in accordance with the contract.”
  • Loyalty—Loyalty “require(s) the agent to place the principal’s interests above those of all others, including the agent’s own self interests.”
  • Disclosure—“It’s the agent’s duty to keep the principal informed of all facts or events that could affect a transaction.”
  • Confidentiality—Agents must keep “the principal’s personal affairs” (including bargaining position) confidential.

Each of you are an Agent who is licensed according to local regulations. Some of you have many years of experience in the field and know what to do without hesitation.  We are finding, however, that despite the fact that you might know what to do, some are not doing it.  Of greater concern, the Secret Shopper program revealed that some Agents were possibly acting in a manner opposite of  exercising “Care”, “Obedience” or “Loyalty”.  Some of the specific issues recently encountered:

  • Pocket Listings:  Delayed, limited or no responses (not giving information freely, not returning calls/emails, etc) to emails and phone calls from potential buyers (some actual buyers and some from the Secret Shopper program) have lead us to believe that Agents are intentionally withholding information from prospects in an attempt to steer the buyer’s side of the transaction to themselves or in-house Agents.  We expect that the agent or a knowledgeable person from an agent’s staff return all potential Buyer calls within 24 hours, or if on a weekend or holiday, by the end of the next business day.  In addition, please remember that  a Seller must consent to a dual or limited agency arrangement.  If we ever feel that the representation presented is questionable, we reserve the right to reject the offer and to terminate the Listing Agent’s relationship with GRC.
  • Aged or Limited Interest Properties: If a property is not listed at your suggested value, you must keep the Seller’s position “Confidential”.  You should never advise a potential buyer or buyer’s agent that the Seller will take less than the asking price or terms.
  • Seller Requested Financing: Some of our clients request that Agents present their financing options, which may include incentives for closing.  Your responsibility is to know the programs and be able to speak/communicate intelligently about them to all prospects (“Care”).
  • Maximizing Value:  All offers that you receive on any listing must be presented to the Seller/Principal without delay! “Obedience” to this principle is made clear in the Listing Agreement.   We have consistently emphasized this point in training and in other email communications to agents.
  • Presentable Property: Basic items are required with all property assignments, including the following:

1.        Signs on the Property

2.        All Utilities Active

3.        Seller Required Documents in the Property

4.        Clean and Presentable Interior, Maintained Exterior, etc.

While some of these items are directly in your control (signs, docs), some may not be your direct responsibility (Property Pres Co maintaining the interior/exterior).  You are however responsible to sign off on any work completed by the property preservation companies and always disclose any outstanding issues.

We expect you to act ethically in all dealings with GRC and with the assets of all of our clients.  We have referenced the FNMA efforts above; however I must emphasize that we expect your highest efforts on all assets managed by GRC.  To help confirm that you are, we have expanded our investigative programs to provide real time feedback and help us remove any consistent violators from our Agent Network.  While we understand that things may happen (sign is stolen the hour before we show up to inspect), we expect a limited fail rate.  You should expect the following to begin shortly:

  • Offers – We may submit offers on our own listings to see if you are following through and presenting all offers as required, without delay!
  • Communication – We may call or email you or your office for information on a listing.  The time you take to respond and the quality of communication will directly affect future assignments.
  • Property Inspections – We will visit any number of properties to determine if they conform with GRC/Client requirements, including any required postings, signs, interior/exterior maintenance, active utilities, correct lockbox codes, etc.

GRC takes your responsibilities and duties as a Agent very seriously.  As noted, if we find consistent, unethical or inappropriate actions relating to any of your assets assignments, we will re-assign the asset in question and, if warranted, reassign all assignments and remove the Listing Agent from our database.

As always, please contact your assigned Senior Asset Manager or Vendor Management if you have questions or need clarity.

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Bob Southard
Broker - Owner  Atlas Realty Service LLC #75911
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O:678-439-SOLD(7653)

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Comment balloon 3 commentsBob Southard • June 24 2010 08:54AM

Comments

Thanks for the post! I too am happy to see that something is finally being done. I can't tell you how many REO transactions I've had in which the listing agent would take days to return a phone call or email. Its really frustrating when your buyers and lenders need answers and you can't get them. I pride myself on being prompt and professional, but its tough when your hands are tied!

Posted by Kelly Cherry (ERA Pacesetters Realty) over 8 years ago

AMEN.  Since we are in the same market I can concur with the "several that just really stink" assessment.  Not only do they need a secret shopper, but they need someone reviewing the offer submittal process to ensure that the listing agent is, in fact, submitting ALL the offers not just holding out until his "office buddy" can find a buyer for the house they are trying to steal.

And, if you are out there reading this, YOU KNOW WHO YOU ARE & SO DOES FANNIE MAE!  They just haven't decided to care yet!

Posted by Jenna Dixon, Empowers You With a Better Real Estate Experience (DRA Homes | Cobb County Real Estate ) over 8 years ago

Kelly, I have submitted offers and was told to check for updates on the broker website. Never updated and never got a response.  Needless ot say we moved on and bought a different house.

 

Jenna, I wont name names here but you are right.  There is one in particular that has been a big producer but new to foreclosures.  I pretty much refuse to show their listings at this point.  No responses, no lockboxes or combinations not on lisitngs,  cant get a hold of a human at their office.

 

On the other hand, the one around here that is probably the biggest and has been in REO the longest I have dealt with several times and actually liked it.  I can make a phone call and actually talk to the assigned listing agent and responses to offers are usully well communicated.

Posted by Bob Southard, e-Pro - Cobb, Cherokee, North Fulton (Atlas Realty Service, LLC) over 8 years ago

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