Receiving Your First Assignment

I WAS UNPREPARED. I didn’t know how it happened, but I know that it did. I got my first assignment. It was through an email with the subject line, “You have been selected for a new assignment.” When I clicked on the email, I was sent to a link where I would have to accept or reject the assignment. The only thing I remember is hitting that accept button as fast as my eyes could blink. That was the moment. Accepting that assignment felt like making a deposit into my bank account. It felt great!

Getting an assignment takes time. It doesn’t happen overnight. I remember there was a sizeable wait from the time I got in with the bank to the time I actually got the first assignment. After a couple of weeks after being approved as an REO agent with the bank and not receiving a single assignment, I thought I had done something wrong. Was it how I emailed them? Did they not like the thank-you card? I started to doubt myself.

But that was back when I first started. That was when REOs weren’t a popular sport, and it was hard to get anyone else’s perspective on the business—because they didn’t have any! What I’ve learned from that time to now is that everyone gets their first assignment; some get it early and some get it later. Regardless, it is how you manage the first assignment that determines if you get more. The first assignment is your first impression. You will never get a second chance to complete your first assignment.

Your first assignment must be perfect. When I coach, I always tell everyone that there is zero tolerance for delays or errors. Every component must be completed with 100 percent accuracy and timeliness. Asset managers translate excuses you make into excuses they will make when justifying why they shouldn’t give you more properties. The only way you will be able to succeed is by knowing what you are doing.

When I received that very first assignment, I was uncertain about how to submit the names of the occupants, so I emailed the asset manager. He emailed me back. I responded with another question. He never emailed me back. I submitted the assignment, and it was my first and last. I did not receive another assignment from that asset manager. Now I realize why. Why would an asset manager give assignments to someone who doesn’t know what they are doing when the bank has seasoned REO agents ready to handle more properties? It makes sense.

You must know what you are doing! I’ll say it again, because it’s so important: There is zero tolerance for delays or errors. Every component must be completed with 100% accuracy and timeliness. It all begins with your first occupancy check report.

OCCUPANCY CHECK REPORTS (OCRS)

After the foreclosure sale occurs, the bank will assign the property to you, the listing agent. As soon as you receive the email that with the subject that states “you have been assigned a new property,” accept it. Don’t think twice. The first task you will be required to do is to determine the Occupancy Check Report (OCR) for that property (see Appendix P). This task has one basic goal—to find out if the property is vacant or occupied.

I used to think this task was very simple; I thought that all I had to do was mark whether the property was vacant or occupied. But I have learned since that it is necessary to be as detailed as possible. I figured out that many listing agents do not take this task seriously, and in doing so they indicate that they do not show the same appreciation for the assignment as those who are detailed. Think about it. If you are not detailed and timely, what type of impression does this make? It shows that you are not hungry. Not appreciative. Not eager to make it happen.

When I was coaching in the spring of 2009, one of my agents asked me, “Why do you think the asset manager removed my assignment?” After going through what happened, I told him, “Because it didn’t seem like you wanted it.” The agent was unable to get into a condo because the security guard said that that he needed a notarized letter from the bank stating he was authorized to enter. So the agent marked the property as “unknown occupied” because he couldn’t get into the building to determine the occupancy. That’s all he did. He didn’t follow up. He didn’t put forth any effort to escalate the matter. It seemed as if he didn’t even want the assignment. So it was removed.

I tell my mentees to treat every assignment like their first assignment. Be detailed, communicate, and know what you are doing! Communicate with all parties before communicating with your asset manager. Try to resolve any issues that arise without the use of your asset manager’s time. Leave the asset manager with the impression of “wow.”

Determining occupancy and completing your occupancy check report is easy. There are five simple steps you will need to follow:

1. Look at the tax record of the property.
2. Drive to the property within twenty-four hours of getting your assignment.
3. Post your occupant options letter and take a photo with a date stamp as proof.
4. Determine if the property is vacant or occupied.
5. Order the rekeying of locks from your vendor.

After you receive your assignment and accept it, you should pull up the tax records of the property. The biggest mistake you can make is to drive to the property before pulling up the tax records. On the tax records, you will look for the following items:

a. What is the name of the former owner?

b. Is the property a single family home, a condo, a duplex, a triplex, a fourplex, a co-op, a townhome, or manufactured housing?

c. How many units are there, based on the tax record?

d. If the property is a condo, what is the name of the condo?

e. What is the folio number (tax identification number) for the property?

f. Was the property previously listed on the MLS, and if so, from what dates?

g. Are there pictures of the property on the MLS, and if so, how outdated are they?

After going through the tax record, you need to physically visit the property to determine whether the property is vacant or occupied. If it is occupied, find out as many details as possible.

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Drive to the property within twenty-four hours of getting the order from the bank. Remember, first impressions account. Always be prompt, accurate, and detailed with your work submissions. Make it very easy for the bank to understand that you work hard without having to be reminded You want it to count on you.

Most banks will have an occupant options letter flyer that they want you to post on the front door. Other banks have a door hanger that you are required to hang on the front door. The poster discusses various options the occupant(s) may have, including getting cash to leave (cash for keys), the ability to rent, and the ability to purchase the unit.

Be sure you post the flyer in both English and Spanish and take a date-stamped photo. Then, after you take a photo, knock on the door to see if anyone answers.

Also, take a photo of the exterior property showing the house and unit number. If the property is a condo, take a date-stamped photo of the building number and apartment number. In the interest of being thorough and making a great first impression, also take a date-stamped photo of the street intersection.

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THE THREE OCCUPANT OPTION POSTING RULES

When I was a rookie, I never used to put the notice on the door before knocking when doing the Occupancy Check Report. I used to knock and hand-deliver the notice. One time, the bank was in the process of doing an eviction and the judge asked the bank to give the court proof of placing the notice.

When the bank asked me for this I said, “I hand delivered it.” That was a big mistake. The occupant was then able to stay in the house for another six months because there was no real proof I had given it to him! From that point on, I learned to always place the notice (in English and Spanish), take the date-stamped photo, and then knock. Follow these three steps and it will save you a lot of embarrassment!

Sometimes you may be unable to determine occupancy. You knock and you get no response. You think someone is living in the home, but you are not certain. Here are some clues to help you determine occupancy:

• Look at the landscaping: Is it maintained?
• Are there cars in the driveway? Where are the license plates from?
• Have the neighbors seen anyone around?
• Look around the mailbox: is it empty or full? Find the mail carrier and ask if there is any activity in the house.
• Look through the windows. Is there any personal property inside?
• If it’s a condo or property in a home owners association (HOA), ask the association if anyone is living there; go to the main office.

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Get as much HOA information as you can during your initial visit. Important places where HOA contact information can be found are the mailbox, common areas, the leasing office, front entrance signs, and fences. It is important that you have the HOA contact information, as you will need to update your bank platform with it. Therefore, get it on your first visit. Don’t leave until you have it.

If the property is a condo, first do a quick Google search or try con-docerts.com; if that does not help, look in public records for a case in which the condo association was a plaintiff. One example would be a case where the plaintiff (condo association) filed a lien or lis pendens on another party.

When you click on that case, you will see which attorney represented the condo in that lawsuit. Eight out of ten times, this will be the same attorney the condo is currently using. Call the attorney and ask them to provide you with the condo association contact information.

BE PREPARED AT ALL TIMES

I remember when I was on the field back in 2007 and on one of my initial OCR inspections. I was inspecting a condo located in a very nice building; the unit was on the sixth floor. I was overly excited and underprepared. I remember seeing the email on my smart phone, and instead of stopping by my office, I decided to make a U-turn and head over to the unit. I pulled up in the parking lot, hopped out of my car, and knocked on the door.

As I finished putting up the last piece of scotch tape of the bank notice on the door, a beautiful, five-foot-eleven (I’m guessing) woman with blonde hair and hazel eyes opened the door screaming, “Please don’t kick me out, I was told to be here, I have no place to go.” Her hair was frazzled, and she was out of breath. Also, she was topless. Yes, true story.

I said, “Uh … hello. I just wanted to ask you a few quick questions, are you….” She quickly cut me off and began ranting about her life story, stating that she was a “model” who was in the United States illegally, and she began begging for me not to call the police. She told me how she used to “work” at the condo through an “agency,” but she wasn’t officially living there. As she was telling me her story, a large and muscular six-foot-six inch (guessing also) male ran to the front door with a backward-turned baseball cap and baseball bat shouting, “Get out of here before I…”

Before he finished his sentence I jetted down the stairs, straight to my car. I was so shocked and scared to death at the same time. The lesson I learned is this: whatever you are expecting, forget about it. You never know what can happen. Always put your safety and health first.

As time went on, I dealt with many precarious situations, such as loose dogs, barbed-wire fences, occupants with shotguns, drug addicts, squatters, etc. Working with REOs is interesting. However, never forget to be prepared; prepare for the worst and hope for the best.

Not every case will be as crazy as the “model” story. Most of the time you will have people occupying the home. If the property is occupied, be sure to have a pencil and paper to write as much information as you can from the occupants. Here is what you will need to jot down:

• Occupant names
• Phone numbers
• Email addresses
• Are occupants tenants or former owners?
• If tenants, do they have a bona-fide lease? (Is the lease in good faith? For example, is there written documentation, proof of past payments, other items showing that the lease was executed in good faith?)
• Are there any children living in the home? What ages?
• Are there any occupants under the age of six?
• How long have the occupants been residing at the property?
• Are any of the occupants receiving government assistance?
• Any other pertinent information the occupants are willing to provide.

Once you have your data from the occupants, you will have twenty-four hours or less to complete your Occupancy Check Report (OCR) report. This is done by transferring your data from your visit to your bank’s platform. Remember to be extra detailed. The more comments you have, the better.

If you are unsure of the occupancy and are planning to revisit the property after a couple of days, you should still complete the OCR within twenty-four hours and note in the comments that you are planning to go back. The more detailed and thorough you are with the comments, the more likely you will be to get the property vacant, marketed, and ultimately sold.

The best news is if the property is vacant. You will be one step closer to closing and cashing in on your ATM. If the property is vacant, order the property to be rekeyed by contacting your vendor (i.e., your locksmith). Be sure the locksmith puts a lockbox on the door with three keys inside the lockbox.

Which locksmith should you use? You can find a locksmith from your local yellow pages, angieslist.com, or craigslist.com. Make sure you interview the locksmith to check that they are capable of performing rekeys on the same business day of you placing the order, and that they will not make any excuses such as “I couldn’t get in through the building.” Tell your locksmith to “make it happen” and negotiate with them so they put the lockbox on the front door of the home, along with three keys inside. Remember, keys get stolen.

Often there will be properties that are vacant, but upon further exploration, you will find that there is personal property inside. You can often tell by looking through the windows if any personal property is inside the home. If you notice that there is personal property even though the home is vacant, only rekey the back door. This is because if you rekey the front door as well, you can be liable for illegal forcible entry. If you do rekey a back door, be sure to post a notice on the front door stating that you have rekeyed the property, and provide contact information so that occupants can call you. Most times, they will call you to retrieve their personal property.

Once the property is rekeyed, perform the initial interior inspection. Note that if there are any personal property items left inside the home, special laws that vary from state to state require certain actions. Check with your local municipality or state ordinance to determine what threshold of personal property requires a court order to remove.

PERFORMING THE INITIAL INTERIOR INSPECTION

Once the property is rekeyed, you will most likely be instructed to place bank signs all across the home—at the front, back, and sides. These are signs with your contact information that warn people not to trespass. When you have access to the inside of the property, don’t expect to see a spotless home that is ready to be moved into. Most of the time, the homes will be damaged and in need of repair.

From the initial interior inspection, you should be able to determine the extent of necessary repairs, any potential liability issues, whether personal property exists, if any immediate emergency repairs are required, and what is needed to ensure that the property itself is secured.

Finally, update your bank’s platform with the results of your initial inspection to ensure that the bank is aware of any special circumstances.

MANAGING CASH FOR KEYS

If the property isn’t vacant, most banks have several options that they offer occupants. Most of the time, the occupant will be offered cash for keys. Cash for keys is a program that gives relocation assistance to the occupant if the occupant is willing to move out of the home and give their keys to the bank. Usually, the sooner the occupant is able to move out, the larger the cash for keys amount they can get. If the occupants do choose cash for keys, they are responsible for leaving the property in “broom swept condition,” which means move-in ready.

The cash for keys process is very simple. You will get the negotiated amount approved by your bank, and you will meet with the occupants to provide the bank forms they need to sign and a check from your office. Before the occupants sign and hand over the keys, you will have to perform an inspection to make sure the property is left in broom-swept condition.

Many occupants feel the need to take all the appliances, hardware, fixtures, and faucets when they leave the property. It is best to let them know from the very beginning that they are receiving cash for keys with the agreement that they are only to take their personal belongings from the house; nothing else.

As a listing agent, you may feel the need to avoid paying cash for keys and letting the bank formally evict the occupants, even though you will be reimbursed for it. However, that will hurt your pocket book, performance, and statistics in the long run. Cash for keys, even though amounts can vary from $1,000 to $5,000, is a win-win-win situation.

First, the occupants win. They don’t want to deal with a sheriff or a police officer with a badge and a gun. Most likely they have been living in the property for quite some time without having paid their mortgage or rent (maybe even years). Many consumers take advantage of the daunting foreclosure process and choose to stay in their homes. This is a strategic default. By the time you come to the door, they are already content with living for free and are thrilled that you now are actually paying them to leave.

Second, the bank wins. Banks avoid having to litigate in court. Offering cash for keys is a faster and more economical solution. It saves them attorney’s fees and minimizes the time in which the property can further depreciate. Also, it preserves the property (e.g., appliances stay intact, fixtures aren’t stolen, etc.)

Finally, you win. As the bank’s REO listing agent, you will get reimbursed 100 percent for the negotiated cash for keys amount. You get a vacant property, get a head start on the valuation, marketing, and placing a buyer in the home, and have better turnaround-time statistics to show your asset manager. Remember the ultimate bank rule: maximize value and minimize disposition time. The cash for keys exchange actually speeds up the cash flow for you despite the initial cash outlay.

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On the other hand, if after determining that the property is occupied and the occupants are uncooperative (i.e., they do not want cash for keys), then you must proceed with an eviction. Remember the occupant options letter that you took a date stamp of? Well, the foreclosing attorney will need it to “file a motion” in court. In court, the number one defense story from an occupant is “I never got the notice”; therefore some banks will also require you to take a date-stamp picture of the envelope that you mailed.

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If there are any illegal units (e.g., illegal rooms, efficiencies, etc.) in the property, it is important to include those illegal units as if they were part of the original home. For example, if there is a duplex with two illegal units, note for your bank platform that the property is a four-plex. In the comments, state that units three and four are illegal. Most courts will require an eviction to serve all units in the home, even if the units are illegal.

ATTENDING EVICTIONS

Unfortunately, sometimes the bank has no choice but to start an eviction, and at that point, the bank’s attorney will go to court. The bank’s goal will be to get the occupant out of the property so you can market and sell it. This is why you must be on their team and help them with the eviction.

When do you attend the eviction? You will most likely receive an email or a phone call from the foreclosing attorney telling you what date and time the evictions is being held. Since you are the listing agent for the bank, you must be present at the eviction, or else the local sheriff will cancel the order. You will be given a time frame of two to six hours when the sheriff can arrive and do the eviction. This will take a large chunk out of your day, so plan ahead of time.

Before the sheriff actually executes the eviction, he or she will issue several warnings to the occupants. The last and final warning, sometimes referred to as a “writ of possession,” informs the occupant that they have a short timeframe (e.g., twenty-four hours) before the sheriff returns and moves their personal belongings out of the house.

A locksmith must also be present for the eviction. At the eviction, the locksmith will change the locks, and you will be responsible for moving the personal property to the front curb; however, this rule varies from state to state, so check the law beforehand. We also recommend scheduling a moving crew to move furniture on to the front lawn. I have been at evictions where I had to move an entire bedroom and living room set. It was not fun. Remember, before incurring any expense, get it approved by your asset manager for reimbursement.

The occupants will then have another twenty-four to thirty-six hours to collect their personal belongings. The property should then be secured (locks changed).

If you had it marked off in your bank platform as “tenant occupied,” change it to “vacant” and write a detailed description with time tables describing what happened during the eviction process (“I arrived to the house at 8:30 A.M., waited for the sheriff for two hours, locksmith arrived at 9:15 A.M., tenants were peeking through the window,” etc.).

HOW TO GET INTO CONDOS AND GAIN COOPERATION FROM HOAS

Condo associations or HOAs are sometimes very difficult to work with. However, to gain cooperation, you must get the association on your side. Sometimes condo managers will refuse to let anyone access the unit until they have a notarized authorization letter faxed to them along with the “certificate of title” showing that the bank that is authorizing you to access the unit. When sending information to the condo, be sure to include the following three items:

1. Certificate of title, or instrument showing the bank as the owner of record.
2. Letter from the bank/asset manager giving you permission to rekey, access, market, and maintain the property.
3. Letter from you to the condo granting all other real estate agents, utility workers, contractors, etc., permission to access the unit.

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To gain the cooperation of the property manager at the condo, you have to show them a couple of things besides the items we just discussed. First, show them you really appreciate their cooperation. Do not act like it is their duty to give you access. If you do, they will be very difficult to deal with. Appreciate their cooperativeness. Act like they are doing you a favor.

Second, show them that you are willing to entertain any offers the property manager may have. Sometimes, property managers are targeted heavily by investors who tell them to notify the investor as soon as an REO is up for sale so they can buy it. Telling the manager that you will entertain any of their offers is critical in gaining their trust. They will like you.

Finally, you are, in fact, authorized to access, rekey, and list the unit for sale. Make sure you fax and email the property manager the authorization letter and certificate of title. Please see a sample authorization letter below:

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CHECKING CERTIFICATES OF TITLE

Certificate of title is a crucial document that shows the owner of record at the time you are notified by the bank to market the property. There are a couple of ways to retrieve a certificate of title. First, you can call the foreclosing attorney who represented the bank in the civil pleading. Alternatively, you can go online to your local court clerk’s website to look up the public records database.

Search by the former owner, as there will most likely be a court docket online showing the progress of the foreclosure case. In many counties, the certificate of title will be readily available on the court’s website, so you can download it immediately without having to call the foreclosing attorney.

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OBTAINING ESTOPPELS

Some associations are growing increasingly strict about past-due HOA payments, and as such are preventing banks from accessing the unit until all past-due HOA fees have been paid off. Therefore, an estoppel is needed. An estoppel is a document that informs all parties of the amount of past-due payments that are missing and the need to be brought current.

Estoppels are required for the bank to provide a free and clear title (no encumbrances or liens) to the new buyer. The new buyer should not be responsible for any past-due HOA or condo fees that were not paid. Therefore, estoppels are used in order for the new buyer to own the property free and clear without having obligatory back-payments due in the future.

One thing to note is that HOAs have becoming increasingly aware of the potential to make a lot of money from the past due fees by adding “special assessments and attorney’s fees” to the estoppel payoff amount. It is critical to set the upfront agreement when initially requesting the estoppel to let the HOA know that the bank will not pay for an estoppel that does not comply with “statutory regulations” or whatever the state law says.

States have statutes that limit the amount of estoppel a condo or HOA can collect. Regardless, always negotiate to waive the late fees and penalties on the estoppel letter by explaining that the property was in a foreclosure. Most of the time, the HOA or condo will be able to waive part of the fee.

Estoppels will usually be handled on behalf of the HOA or condo by their attorney or a third party. When you contact the appropriate party to request an estoppel letter, they will charge you a fee. The best thing to do is ask them to add the fee to the actual estoppel pay-off (the final bill). This will help save you the up-front cost of ordering the estoppel. Also, be sure to confirm if there is more than one association that requires estoppels. Some condos are governed by multiple associations.

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Below is a sample estoppel request form (also found in Appendix Q) that you will need the HOA’s attorney or property management to complete:

Please complete the following information.

1. Maintenance amount
2. Water included in maintenance (y/n)?
3. Intervals that payments are due (annually/quarterly/monthly)
4. What date is maintenance paid through?
5. What date is your estoppel letter good through?
6. Are there any accrued late fees due (y/n)?

   a. If yes, amount due?

7. Total amount now due (attach a breakdown and a W9 form)
8. Are there any special assessments due (y/n)?

   a. If yes, date assessments were passed?

   b. If yes, are assessments payable in installments (y/n)?

   c. Total amount to pay now in full

   d. Date due

9. Written condo approval required (y/n)?

   a. If so, has buyer been approved (y/n)?

10. Any other associations or clubs to the referenced unit (y/n)? If yes:

    a. Name of association/club

    b. Contact person name

    c. Phone

    d. Fax

    e. Email

11. Name of master hazard insurance policy company

    a. Name of agent

    b. Address

    c. Phone

    d. Fax

    e. Email

12. Name of master flood insurance policy company

    a. Name of agent

    b. Address

    c. Phone

    d. Fax

    e. Email

13. Is there a recreation lease (y/n)?

    a. If yes, payment amount?

14. If there a leasehold interest (y/n)? If yes:

    a. Is there an existing lease (y/n)?

    b. Amount of lease payment

    c. Is this payment included with maintenance?

Also, when ordering the estoppel, make sure you order the W-9 and ledger too. A W-9 is a form used for tax purposes so the bank can write off its payments to the association as an expense. A ledger will detail each charge the association is claiming as past due. Make sure there is no balance being carried forward from a time period in which the condo should not have been collecting dues.

For example, if your state statutes indicate that past-due payments can only be collected a maximum of one year back, make sure that the ledger does not carry forward a balance in the first month. The first month should start with a zero past-due balance and then accumulate the allowed amount of past-due payments throughout the following months. The ledger will detail this precisely, so pay close attention to it.

MANAGING UTILITIES

After you finally get access to the house and mark off on your bank’s platform that the property is vacant, you will need to turn on the utilities (water/electric) to the unit. Utilities are a very important aspect of making your REO presentable, as they discourage pests, rodents, and mold from lurking on the property. Also, the bank’s in-network cleaning crew (discussed later) will not be able to clean the unit until utilities are set up, as they need access to water and electricity.

However, note that many electric companies will not be able to turn on the electricity if the breaker switches are in the “on” position. Therefore, it is imperative that the listing specialist or field rep making the initial inspection always turns the breaker switches to “off.”

In addition, it is critical that the field rep turns all water valves off. Do not leave any water faucets or valves on. Avoiding this mistake is simple, but you’ll be surprised at how many agents actually don’t get it right.

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One question I get asked all the time is, “Should I open up a temporary electric account or a permanent one?” Always open a permanent account.

Many agents choose not to open up a permanent utilities account because these accounts require a deposit, and sometimes a very large deposit. But temporary accounts only remain good for thirty to sixty days, and the electric company will turn the service off as soon as these accounts expire. Also, remember from Chapter 1 that you are looking at a ninety-day turnaround time to close on your first property. Therefore, you must have the utilities on until the buyer’s ink is dried at the closing table.

Also, there are unforeseen circumstances that arise out of all transactions, even the cash ones (e.g., title hold ups). The last thing you want is for your home not to have utilities, which causes a delay in closing. Do not let this happen.

More importantly, for certain types of financing, such as the Federal Housing Administration (FHA) mortgage insurance, appraisals must have access to both water and electricity. Also, if your property needs repairs or a home buyer is doing an inspection, utilities will be needed; therefore, no utilities, no closing. Turn on the utilities immediately. Don’t fret over it. You will be reimbursed for it by the bank.

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One recommendation we can give you is to not sign up for auto-pay. Sometimes there are unforeseen instances where water is being stolen and you end up with an unusually large bill. The last thing you want is to have to explain to the bank why you are demanding a larger-than-usual reimbursement.

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We also recommend setting up a master utilities account if it’s available in your area. Having a master account will sometimes enable you to apply a deposit for a property that you have already sold to a new property that you are about to list. This can help save time and resources by automating the deposits to roll over from one property to the next. In addition, this will efficiently help you control your cash flow by keeping your cash in your pocket instead of having it somewhere in the mail.

A few final words about utilities: most of the time, the property will have a main water shut-off valve on the outside of the house. Don’t get baffled if you have turned on the water and there is no water coming from the faucets. Check the outside for the main water shut-off valve and make sure the valve is not off. Also, keep the home at 74 degrees Fahrenheit. Based on my experience and research, this temperature meets the perfect balance between marketability and cost effectiveness.

AGENT SIGN-OFF SHEETS

Once you leave the property and head back to your office to upload your OCR into the bank platform, you will be emailed one final task to complete. This happens if the property you visited was marked “vacant.” Once the bank platform shows the property is unoccupied, it automatically triggers an email to their in-network cleaning crew to visit the property and clean it. Your job is to re-visit the property within twenty-four hours and rate the cleaning.

If the cleaning was done sloppily, or if the cleaning was incomplete, you need to note the deficiencies in an agent sign off. This sheet has everything that you will look for when checking the cleaning work. If everything is good, you will sign off on the cleaning job. If the cleaners need to go back to finish, then you will not sign off on the cleaning job and will mark what needs to be redone.

It is important that you do not base the rating on the condition of the property. The rating should be based only on the initial cleaning, trash out, and landscaping (if any) performed by the cleaning company. If you have a property that has a concaved roof, it should not influence your rating on the quality of work the cleaning company did. Banks have a lot of checks and balances in place. You will check the cleaning company’s work while an appraiser will check your BPO to make sure you are not low-balling the value.

Don’t let cleaning companies take advantage of your eagerness to list the property for sale and do a low-quality job. Cleaning companies know that after a property is cleaned, it will be listed for sale (assuming there are no repairs needed), and if you’re in a hurry to list the property you might overlook a less-than-professional effort. However, as the listing agent, it is your responsibility to make sure that you check the quality of their work and ensure that all items have been cleaned to satisfactory conditions.

Even if one item is deficient, you must flag it. Let them make a second trip out there to fix it. Remember, it can only help you market the property to a customer and will help the bank achieve a maximum value for it. No one wants to open a door and have a spider fall on them or have a dead rat in the middle of the living room. I have experienced both. It is not pretty.

Below is a sample agent sign-off sheet checklist (see Appendix N) that you can use when inspecting cleaning. You will be required to confirm that each area has been cleaned to satisfactory conditions. If it hasn’t, you are to mark the respective area as “deficient,” so the cleaning company can redo the cleaning in that area.

Agent Sign-Off Sheet

Cleaning—Initial (Completed __/___/____):

Some agent sign-off sheets will ask you to give an overall rating as a big picture consensus. When providing an overall rating for the initial cleaning, be sure you keep these categories in mind:

• Excellent: all cleaning criteria were completed to satisfactory conditions. No areas were deficient; the subject is clean, safe, and presentable.
• Good: most of the cleaning criteria were completed to satisfactory conditions. If only one area was deficient, then you should mark the overall rating as “good.”
• Fair: some deficiencies require the cleaning company to go back to resolve the cleaning issues. If two or more areas are deficient, you should mark the overall rating as “fair.”
• Poor: serious deficiencies are present and the cleaning company must go back to immediately resolve the deficiencies. Mark the overall rating as “poor” when there more than three line items are marked as deficient.

Also, inform the cleaning company of any special requests that you have. Remember, since you will be completing the initial inspection before the cleaning services are approved, you will be able to assess the condition of the property. Here are some items you may ask the cleaning company to take care of:

• Replace any light bulbs
• Replace any air conditioning filters
• Remove any appliances that are a safety hazard or that depreciate the value and appeal of the subject
• Remove any curtains or blinds that may be outdated
• Remove mail and trash from the property
• Secure any outside gates
• Board up any broken windows
• Fix any toilet valves that do not allow toilets to be flushed
• Add air fresheners to a particular part of the home
• Fix any exposed wires
• Add receptacle plates
• Add smoke detectors, or add batteries to remove any “chirping”
• Provide landscape package

Be sure that the cleaning company bills your bank directly. Most banks have an allowance that they provide cleaning companies with.

Remember, the first assignment that you receive is the most important assignment you will ever get. Treat it with as much detail, precision, and care as you can. Using the previous guidelines will be to your benefit. You will soon see assignments start piling up. Remember to treat each new assignment with the same diligence and precision as your first one. But before getting excited about future assignments, it’s time to learn about Step 2 of the REO Cycle: Conducting the Perfect BPO.

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POINTS TO REMEMBER

• Add special requests to your agent sign offs. Start thinking of marketing when doing your agent sign-off sheet so you can find a buyer fast.
• Be very detailed when signing off on the cleaning. You don’t want to put your name on the line when something is deficient and requires attention.
• Turn breaker switches and water valves off before turning on utilities.
• Set up a master account for your utilities but do not use auto pay.
• Have the estoppel bill added to the final pay-off amount so you do not incur the costs upfront.
• Gain cooperation from managers at condos and HOAs. Explain that you want to help them get all their past-due amounts paid and current. Establish rapport, smile, and don’t argue unless you have to.
• Schedule your locksmith or cleaning crew in advance for a property eviction, as the sheriff or police can take two to six hours to show up.
• Resist the temptation to not complete cash for keys. Even though your cost is the time in which it will take to be reimbursed, the benefits far outweigh the negatives.
• Know the three occupant options posting rules: tape the letter, take a date-stamped photo, and then knock on the door; the number one defense in court is, “I never received the notice.”
• Know what you’re getting into before making your first trip. Check out the tax record, call the association, call the utility company, and find out as much information as possible so your trip will be efficient and worthwhile.