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Why Would One Need You?

Question: When asked to articulate why your career needs to exist, how would you respond?

It may not surprise you to know that most agents cannot answer this very simple question. If you are thinking that you couldn’t answer this question, you may want to reconsider your career choice. After all the bravado and rah-rah that most agents and their companies spew, they still don’t seem to know why they may actually be needed in a transaction. Oh sure, they might be able to write a contract or run an ad, but most agents, when the hard times come, simply default to their broker who may or….may not know the answer. If you can’t understand what need the client has for you, than how do you expect anyone else to know? The reality is that most people, in generations past, used an agent ‘because that’s what you do’, but the consumer of today is not satisfied with that rational.

Your Knowledge Is What Counts

2008 Swanepoel Report: “87% of Brokers feel that servicing smarter and more informed consumers as their largest concern.

Its sad that 87% of brokers feel that informed consumers are their biggest threat! I feel that solely relates to the Broker’s lack of confidence in their agent’s ability to know what to do when a problem comes up; and that they may not be capable to have an intelligent conversation about a given real estate related topic.

The lack of faith is well founded. As an instructor, I take a very interactive approach to courses designed at problem solving. I recently asked a series of situational questions to a class of REALTORS®, once the question was delivered you could hear the crickets chirping in the room. I again asked “If XYZ occurred in your transaction, what would you do?” One student raised his hand and said “Put a Twix in my mouth….” Whereas I found that very funny, I recall the question being very rudimentary and the fact that 50+ students couldn’t resolve it scared me.

My wife and I educate our children at home, and one of the primary lesson plans we try to instill in our children is a level of self reliance and critical thinking. We want our children to know how to resolve issues on their own and to concentrate on those skillsets in life that will allow them to always be learning. I find that this is one of the large areas of lacking in real estate practitioners.

Education Doesn’t Stop After Pre-Licensing

Since finding the treasure chest – that are my social media friends in, I’ve been charmed by the collective knowledge about real estate and often forget that the writers, readers and commenters involved in this venue represent the minority of real estate practitioners. I have started treating most agents as if they were as educated as those in Boy, what a mistake that has become…

Recently I received a batch of course evaluations from a class that I had taught, to a large group. The evals were great and there was only one negative person. This Technology class had one person who was VERY anti-technology; so I presume it was him. The evaluation comment said: “The instructors level of knowledge was considerable, but his ability to deliver this knowledge to the ‘least common denominator’ was questionable” (I paraphrase, as his vernacular was somewhat limited) Wow! Since when should a professional expect a program lecturer teach to the “least common denominator?” I readily agree that I am an intellectual elitist when it comes to this career, because the income and liability is so great.

Where Do You Get Your Knowledge?

Please understand that I am not suggesting that Bloggers are the only, or even best place to get knowledge. Truth be told, with the exception of,, and other highly regarded blogs or new sources, I tend to think that a lot of misinformation comes from bloggers. However, without a well balance SELF DIRECTED EFFORT to learn more about the industry, in which you profess to be an expert in, you wouldn’t know the truth from a misinformed author. The Agent has to desire more knowledge – it doesn’t just occur by osmosis.

I know that most agents feel overwhelmed about the number of industry newsletters, magazines, blogs and emails that we tend to get. However, the knowledge contained in those venues are exactly what your clients presume that you know and understand. Anything less than current knowledge is failure to meet your agency responsibilities. The courts, real estate commissions and professional standard panels are in agreement in this. I have cases histories where not knowing that the DOT was going to widen a roadway resulted in a punitive loss to the practitioner.

Agents need to be the “source of the source” we should know about local politics, practices, ordinances, market trends, history, economics, Federal regulations, lending practices, real estate board regulations, MLS policies, company policies, Standards of Practice, etc…. Does it sound overwhelming and hard? Yes and it should be….or the consumer could easily write their own contracts and find their own lenders. The career is simply more difficult than most practitioners think it is. So, are you armed with the right knowledge to give the best advise to your client when that advise is critical?

Matthew Rathbun is a Virginia Licensed Broker and Director of Professional Development for Coldwell Banker Elite, in Fredericksburg Virginia. He has opened and managed real estate firms, as well as coached and mentored agents and Brokers. As a Residential REALTOR®, Matthew was a high volume agent and past REALTOR® Rookie of the Year & Virginia Association Instructor of the Year. You can follow him on Twitter as "MattRathbun" and on Facebook. Matthew's blog is

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  1. Matt Wilkins

    September 21, 2008 at 4:55 pm

    You hit on a point that I ran into constantly when I worked at a large franchise brokerage. I got tired of hearing “what the client doens’t know won’t hurt me” or “I don’t need to know that as long as the client doesn’t care” or my personal favorite in regards to listing appointments “it’s not what I know it’s what I make the customer believe”. I know this is not representative of all real estate professionals but I heard it enough to make me the anti-social agent of the office and at one point ashamed to be part of an industry with that attitude. I agree Matthew that finding this community does give postiive reinforcement but also doens’t always transfer into the “real world of Real Estate”.

  2. Matthew Rathbun

    September 21, 2008 at 5:05 pm

    Matt: I agree that the vision relayed by the doesn’t immediately translate to the current industry, but it is the future. We’ll get there…

  3. Lisa Sanderson

    September 21, 2008 at 5:46 pm

    Catering to the lowest common denominator…thank you for saying that out loud. It has to stop if we are ever going to raise the level of professionalism in our industry. Consumers are out there teaching themselves about many facets of our business. If we don’t outpace them in that and prove our value, we are doomed.

  4. Bob

    September 21, 2008 at 10:24 pm

    Mathew, I love the title.

    “they still don’t seem to know why they may actually be needed in a transaction.”

    The truth is that those types aren’t needed in a transaction.

    “Its sad that 87% of brokers feel that informed consumers are their biggest threat!”

    Read Activerain and that is readily apparent. The typical response is to insult the intelligence of the consumer. The reason they feel threatened is that many agents really do know that they know very little, so when challenged, they react like Bill Murray in Ghostbusters, “Back off man, I’m a scientist”.

    The consumer has access to info like they never did before and the knowledgeable agent should welcome that. It is another way to differentiate yourself from the competition, because we are now at a point in many markets where knowledge talks and BS walks.

  5. Steve Simon

    September 22, 2008 at 5:47 am

    I have been in the real estate classroom for well over twenty years (and a part time gig running a large county for eight); I have never seen (before) the lack of ethics that I have witnessed in the last two years.
    Remarks like, “Make me an offer, they are desperate, they’ll take anything” coming from the Seller’s Agent puts the whole industry in trouble. It isn’t only that remarks like this are aired, but that it doesn’t even raise an eyebrow that concerns me. I post almost daily on my blog and a few weeks back i wrote about an agent that was refusing to open the listing (not because the time was inconvenient, but because they didn’t feel like it). She told me, “If I do all the work I get all the money and I should have my Buyer, Client, call her directly”. Her boss fixed nothing, he (the broker) just said there were issues with this agent like there are issues with all agents, and it would work out. He has well over a hundred agents working in a shop where bringing in agents gets you an down line monthly income! Almost like, no offense to Amway, but Amway…
    My point is coming.
    I also speak almost daily with my oldest (a family and criminal attorney). I handle the website for her and love listening to my adult/child explain the daily goings on in court, etc.
    To get this lawyer to put something on the web requires an act of congress. Careful about every word that comes out of her mouth. Sheknows she is responsible for what she says.
    When I listen to my doctor, he is careful to the same level. Nothing is 100%. He is thoughtful to the point of speaking so slow and measured , you just want to “slap” him sometimes; but I know he is doing what is right. He is a professional.
    Both of these “Pros” would never speak and hurt a client or patient’s position.
    Then I think back to the series of five or six motorcycle shops I was ina few months back when I was buying a new bike. I think to the sales reps line of garbage. Lack of product knowledge, false promises etc.
    If the current trend continues (the trend towards I will say and do what is in my interest not the client’s), either because the agent hs not ethics or doesn’t even know what is ethical or legal; we are going to earn less and less. You will see there is a direct relationship between the way you conduct yourself and the fees you can charge. Clerks make less than professionals.
    The only hope is a two pronged attack: education and enforcement.
    Real estate education is going through a very big change, the online world has taken over (I have an online real estate school). There will nned to be some adjustments to the delivery systems, and the course content, and the testing. As far as the enforcement, the rules have always been there. It is just that now the enforcement is so spotty that wholesale disobedience is the norm. Rules without enforcement is like “no rules”…
    Self policing doesn’t work.
    I haven’t given up, I attempt to teach and correct as I make my way through the business world. I aggravate a lot of folks 🙂
    Just my thoughts on the topic:)

  6. Mack

    September 22, 2008 at 7:10 pm

    Today I had the enjoyable experience of conversation with a self professed real estate expert of 37 years. I had shown a buyer a property this agent has listed and there was some interest. When looking at the comps I could not come close to the list price. So when I called the agent today and asked for her help with applicable comps she informed me that she didn’t need comps to price a home, she had worked in that area for 37 years and she new what the houses were worth. Obviously she knows “What’s In Her Noggin”, unfortunately it can’t substantiated by the recent sales. Because of what is in her noggin she is doing her sellers a disservice and has the sellers home overpriced by a minimum of 10%. Even if she did get an offer it would never appraise.

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Disputing a property’s value in a short sale: turn a no into a go

During a short sale, there may be various obstacles, with misaligned property values ranking near the top, but it doesn’t have to be a dealbreaker!



magic eight ball

magic eight ball

It’s about getting your way

Were you on the debate team in high school? Were you really effective at convincing your parent or guardian to let you do things that you shouldn’t have been doing? How are your objection-handling skills? Can you flip a no into a go?

When working on short sales, there is one aspect of the process that may require those excellent negotiation or debate skills: disputing the property value. In a short sale, the short sale lender sends an appraiser or broker to the property and this individual conducts a Broker Price Opinion or an appraisal, using special forms provided by the short sale lender.

After this individual completes the Broker Price Opinion or the appraisal, he or she will return it to the short sale lender. Shortly thereafter, the short sale lender will be ready to talk about the purchase price. Will the lender accept the offer on the table or is the lender looking for more? If the lender is seeking an offer for a lot more than the one on the table, mentally prepare for the fact that you will need to conduct a value dispute.

Value Dispute Process

While each of the different short sale lenders (including Fannie Mae) has their own policies and procedures for value dispute, all these procedures have some things in common. Follow the steps below in order to conduct an effective value dispute.

  1. Inquire about forms. Ask your short sale lender if there are specific forms that you need to complete in order to conduct a value dispute. Obtain those forms if necessary.
  2. Gather information. Your goal is to convince the lender to accept the buyer’s offer, so you need to demonstrate that your offer is in line with the value of the property. Collect data that proves this point, such as reports from the MLS, Trulia, Zillow, or your local title company.
  3. Take photos. If there are parts of the property that are substandard and possibly were not revealed to the lender by the individual conducting the BPO, take photos of those items. Perhaps the kitchen has no flooring, or there is a 40-year old roof. Take photos to demonstrate these defects.
  4. Obtain bids. For any defects on the property, obtain a minimum of two bids from licensed contractors. For example, obtain two bids from roofers or structural engineers if necessary
  5. Write a report. Think back to high school English class if necessary. Write a short essay that references your information, photos, and bids, and explains how these items support your buyer’s value. This is not something that you whip up in five minutes. Spend time preparing a compelling appeal.

It is entirely possible that some lenders will not be particularly open-minded when it comes to valuation dispute. However, more times than not, an effective value dispute leads to short sale approval.

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Short sale standoffs: how to avoid getting hit

The short sale process can feel a lot like a wild west standoff, but there are ways to come out victorious, so let’s talk about those methods:



short sales standoff

short sales standoff

What is a short sale standoff?

If you are a short sale listing agent, a short sale processor, or a short sale negotiator then you probably already know about the short sale standoff. That’s when you are processing a short sale with more than one lien holder and neither will agree to the terms offered by the other. Or… better yet, each one will not move any further in the short sale process until they see the short sale approval letter from the other lien holder.

Scenario #1 – You are processing a short sale with two different mortgage-servicing companies. Bank 1 employees tell you that they will proceed with the short sale, and they will offer Bank 2 a certain amount to release their lien. You call Bank 2 and tell them the good news. Unfortunately, the folks at Bank 2 want more money. If Bank 1 and Bank 2 do not agree, then you are in a standoff.

Scenario #2 – You are processing a short sale with two different mortgage-servicing companies. Bank 1 employees tell you that they cannot generate your approval letter until you present them with the approval letter from Bank 2. Bank 2 employees tell you the exact same thing. Clearly, in this situation, you are in a standoff.

How to Avoid the Standoff

If you are in the middle of a standoff, then you are likely very frustrated. You’ve gotten pretty far in the short sale process and you are likely receiving lots of pressure from all of the parties to the transaction. And, the lenders are not helping much by creating the standoff.

Here are some ideas for how to get out of the situation:

  • Go back to the first lien holder and ask them if they are willing to give the second lien holder more money.
  • Go to the second lien holder and tell them that the first lien holder has insisted on a maximum amount and see if they will budge.
  • If no one will budge, find out why. Is this a Fannie Mae or Freddie Mac loan? If so, they have a maximum that they allow the second. And, if you alert the second of that information, they may become more compliant.
  • Worst case: someone will have to pay the difference. Depending on the laws in your state, it could be the buyer, the seller, or the agents (yuck). No matter what, make sure that this contribution is disclosed to all parties and appears on the short sale settlement statement at closing.
  • In Scenario #2, someone’s got to give in. Try explaining to both sides where you are and see if one will agree to generate their approval letter. If not, follow the tips provided in this Agent Genius article and take your complaint to the streets.

One thing about short sales is that the problems that arise can be difficult to resolve merely because of the number of parties involved—and all from remote locations. Imagine how much easier this would be if all parties sat at the same table and broke bread? If we all sat at the same table, then we wouldn’t need armor in order to avoid the flying bullets from the short sale standoff.

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Short sale approval letters don’t arrive in the blink of an eye

Short sale approval letters may look like they’ve been obtained simply by experts, but it takes time and doesn’t just happen with luck.



short sales

short sale approval

Short sale approval: getting prepared, making it happen

People always ask me how it is that I obtain short sale approval letters with such ease. The truth is, that while I have more short sale processing and negotiating experience than most agents and brokers, I don’t just blink my eyes like Jeannie and make those short sale approval letters appear. I often sweat it, just like everyone else.

Despite the fact that I do not have magical powers, I do have something else on my side—education. One of the most important things than can lead to short sale success for any and all agents is education.

Experience dictates that agents that learn about the short sale process
have increased short sale closings.

Short sale education opportunities abound

There are many ways to become educated about the short sale process and make getting short sale approval letters look easy to obtain. These include:

  • Classes at your local board of Realtors®
  • Free short sale webinars and workshops
  • The short sale or foreclosure specialist designations

As the distressed property arena grows and changes, it is important to always stay abreast of policy changes that may impact how you do your job and how you process any short sale that lands on your plate.

The most important thing to do is to read, read, read. Follow short sale specialists and those who blog about short sales on AGBeat, Google+, facebook, and twitter. Set up a Google Alert for the term ‘short sale’ and you will receive Google’s top short sale picks daily in your email inbox. Visit mortgagor websites to read up on their specific policies and procedures.

Don’t take on too much

And, when you get a call from a prospective short sale seller, make sure that you don’t bit off more than you can chew. Agents in most of America right now are clamoring for listings since we are in the midst of a listing shortage. But, if you are going to take on a short sale, be sure that it is a deal that you can close. And, if you have your doubts, why not partner up with a local agent that can mentor your and assist you in getting the job done? After all, half a commission check is better than none!

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