Just heard an ad on the radio. Why would anyone use a discount broker when they need to sell their home to avoid foreclosure?

Asked by Sally English, Atlanta, GA Wed Jan 25, 2012

On short sales, banks have to approve a pay off on your mortgage loan that is less than the amount you owe. The bank is going to build in a comission to be paid to the real estate listing broker. Why not get the best advice and service possible in this very stressful situation? Let the bank pay for it!!!!

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10
Annette Law…, Agent, Palm Harbor, FL
Wed Feb 22, 2012
Pay Less, Live Better!
How's that working for you?

Be aware, this radio ad is not targeting the real estate professional. The purpose of the ad is to get a response from a desperate citizen who is unfamiliar with the process and feed this citizen into their investor system. It works, really, really well.

Each of these promotions offer SOLUTIONS! Desperate citizens seek solutions. Don't confuse the purpose by injecting your intimate, professional experience associated with distressed sales. This is not a complication the citizen must deal with. They seek a solution...a risk free solution...a painless solution...even if it's an illusion.

The folks behind these ads are not working for tips, they are working for profits. From these profits the citizen seeking relief can actually benefit more greatly than permitted by professionals working for tips and under significant prohibitions.

In many cases, it is the investors behind the scenes of these promotions that will be the engine behind getting us through this distressed inventory. Not all, but in many cases, there can be a great deal of good found behind these campaigns. (I know mine are as good and wholesome as apple pie.)

Unfortunately, too many collect up front fees (a really, really significant clue) and that is the last positive action observed. Distressed home owners are truly in the shark tank. It is the collective effort of real estate professionals and investors that will deliver the solutions most beneficial to the circumstances in which the citizen finds themselves. As professionals, we need be prepared with more than one option or solution to present. It is truly a environment begging for the right people.

Best of success in 2012
Annette Lawrence
Broker/Associate
ReMax Realtec Group
Palm Harbor, Fl
727. 420. 4041
Web Reference:  http://www.MyDunedin.com
1 vote
David Herren, Agent, Atlanta, GA
Thu Feb 23, 2012
The motto at Syms is "an educated consumer is our best customer". I think education is the point of Sally's post. In that spirit, I cannot stress enough the importance of sellers interviewing a range of Realtors (forget about sales agents) to find out what they will do for you to sell your home. A knowledgeable full service Realtor will be able to demonstrate that they can sell your home faster and for more money than a discounter.

Thanks for the discussion, Sally.
Web Reference:  http://bestatlproperties.com
0 votes
Sally English, Agent, Atlanta, GA
Wed Feb 15, 2012
Turns out I am not the only one to ponder this questions. Saw a media report about the same issue.
0 votes
Chris Schill…, Agent, Houston, TX
Wed Feb 8, 2012
Sally,

Great question! If you look at the Realtor community, most of us specialize in certain areas....some agents list more, some work with buyers more, some work in commercial, and in commercial there are subsets...apartments, land, office buildings, leasing, etc. While all agents are not specialists in the area of Short sales & foreclosures, having a narrow niche does have its advantages.

We all charge clients differently for our services, so it’s unreasonable to say that an agent that discounts is automatically a lesser agent. The internet has made it easier for agents to do more with less. We now advertise to larger audiences through the online local MLS system that we could have ever afforded 20 years ago when we put our listings in local magazines and the newspaper. Our personal expenses may have increased, (new cars, bigger houses, vacations, etc....), but if we were to be honest, the cost for most of us to market homes has decreased dramatically in the last 20 years. By focusing on a niche that can create tremendous volume, this could be an interesting and successful business model.

If you liked my answer, please give me the "Thumbs Up" and reward me by designating me as the "Best Answer"!
Thanks!

Respectfully,

Chris Schilling, ABR, GRI, CRS, GREEN
Real Estate Broker
Turbo Realty
0 votes
My NC Homes…, Agent, Chapel Hill, NC
Wed Feb 8, 2012
The real question is why anyone would ever use a discount broker?

Brokers who discount do so for one reason only, they aren't making it and the only thing they have figured out is that if their willing to give away their money some people who don't know any better will do business with them. Let's be honest if their willing to give away their own money so fast, how hard are they going to fight for their clients money.

It's a business model, and it's a free country, anyone can try anything they want, but consumers should understand they will get what the pay for and no one who is good at what they do works for free or has to discount.
0 votes
Krisprattre…, Agent, Buford, GA
Sat Jan 28, 2012
I agree with you Sally! I'm a brand new agent and love finding these kinds of discussions on Trulia, it's a great way for me to not only stay up to date with what's happening in a rapidly changing economy, but what other agents think of discount brokers. They seem to waaaay to focused on making money for the bank and not focused enough on someone who is going through a very distressful situation. Thanks for getting a discussion started!
0 votes
Margaret Has…, Agent, Tampa, FL
Sat Jan 28, 2012
You're absolutely right. Get the very best. In a short sale more than ever one needs good advice!
0 votes
Sally English, Agent, Atlanta, GA
Wed Jan 25, 2012
Even more interesting, some of these discount brokers are flat fee. The seller pays UP FRONT for a service the bank would probably pay for in a short sale. And no, they do not reimburse a seller for commissions they have already paid.
0 votes
Craig O'Rour…, Agent, Castle Rock, CO
Wed Jan 25, 2012
It is better to work with an agent that has experience dealing with short sales. Why would you risk a foreclosure to your credit with sub-par service? Short sales have there own unique challenges and it is best to obtain a Realtor who understands the process and gets paid accordingly
0 votes
Tim Moore, Agent, Kitty Hawk, NC
Wed Jan 25, 2012
Discount broker = saves money by cutting advertising, cutting service provided, making buyers agents call the seller directly, etc.

I have to agree with you Sally, it makes no sense.
0 votes
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