Question for SleepWellNow.

[BrokeIn2011]

When the NOD was filed on our house, we came home to find a bag of micorwave popcorn with a couple of Realtor's smiling faces on it with the note "Just popped by to see if we can help". It was so insensitive we just had to shake our heads and laugh. Funniest part is, we are Realtors too!

On a side note Sleepwellnow, since I am unemployed and I am thinking about getting into real estate (i.e. getting a Real Estate license, to become a Real Estate Agent), I was very shocked to learn that someone in your field managed to get a NOD. YIKES!!! What basically happened that you ended up with a NOD?

During the past 2 months, I have talked with some Real Estate Agents who told me that due to the recession, the economy, the very poor housing market right now, they are staying afloat by doing short sales. Though I know that it is a bad time to be in the R.E. sector, however I know that one day things will get better. So since I am about 20 years from retirement, I figure it might be a good time for me to start a new career in R.E., so I can learn from the ground up, and take advantage of maybe being able to learn this field better by things being slow in this industry right now.

Right now the way I feel, as long as there are people on earth, there will always be a need to buy and sell property. So there will always be a need for a Real Estate Agent. So if all goes well, I do not think there is going to be any modern technology to take the place of a Real Estate Agent and the many necessary functions that a R.E. Agent does in order to buy and sell property in the next 20 years. LOL!!! . . . Because I figure if I become a R.E. Agent, I should make a decent career out of it until I retire. Because I know that the economy will get much better again . . . sooner or later, and the housing market will pick up again . . . sooner or later.

Do you have any “pros” and “cons” for me, before I take this big step and career change? Yet as it is, I am unemployed, so my being a R.E. Agent can’t do any harm now can it??? By the way, I live in a city adjacent to Los Angeles. So I would be working as a R.E. Agent in the Los Angeles area somewhere.

[SleepWellNow]

What basically happened that you ended up with a NOD?

We had a successful business for 23 years that went under. Fortunately, we saw the downturn in our business coming and had time to prepare for our real estate career. Although we have done well in real estate, our income could not support the 5 properties we purchased when our income was much higher. Thus, one of our propeties was lost to foreclosure, one was sold as a short sale and we are in the process of a short sale on our primary residence and our last rental property. We were able to save one of our rental properties through a loan modification, which we will be moving in to. It's been a long road but we now see the end of the tunnel. I will be happy when our challenges are behind us and we can concentrate on helping others as they struggle through this process. Heaven knows, there's nothing like first-hand experience. LOL!

We have been in real estate for almost 5 years now. Those who have been in the business for many years say these have been the toughest years in decades. I don't want to discourage you from going into this business but, you need to be aware, it may be difficult to sustain yourself for the several months it will take to close your first escrow without having savings or an additional souce of income. If we didn't have the income coming in from other sources when we first started, I don't think we would of made it. We've always heard a person going into this business should have 6 months of savings to fall back on becuase it takes a while to see any money. Also, there are a lot of "start up" expenses (ie. joining your local Realtors Association, MLS Fees, license fees, signs, business cards, lockboxes, etc.) It will be tough but maybe you can find a job (any job to pay the bills) and work real estate part time until you can get something going.

I wish you luck in your endeavors. You can be successful in this business but it will take a lot of hours and determination. I have to say, I've never worked so many hours in a week! Sometimes we go weeks without a day off. But, it can be a very rewarding career both financially and personally. If you love helping people, are willing to work hard and always put others above yourself, success will come to you.

[BrokeIn2011]

Thank you so very, very much SleepWellNow. I sincerely appreciate you taking the time to provide me detailed information on your NOD situation, as I originally thought that you just had the one home/your primary home when this happened, and not knowing that you had several homes. Yet I commend you for your desire to help others.

Thanks so much for shedding the light on how I can break into the R.E. business. For sure I know that it is expensive to get into, based on the basic necessities to just start as a R.E. Agent (as you had outlined in your reply), along with the hard work and long hours. In regards to the people that you know in the R.E. business as well and with it being one of the toughest years in this field in decades, are short sales not happening enough to keep the R.E. professionals afloat as I had heard a few weeks ago, would you think? I am not sure what part of California you are in, however there is one well known real estate franchise here (in Long Beach, about 30 miles southeast of downtown Los Angeles) that runs online ads every week for at least 2 career open houses that they have each week, trying to get people to take their offer of a free R.E. licensing course . . yet I know there has to be some catch to this. What do you think it might be? I have seen this office ads running for over a year now, so with our unemployment level being so high in California, you would think people would be jumping at a chance to go through their free licensing course and a job in that office. Yet one year later, they are still holding at least 2 career open houses each week. So what do you think about this?

GOSH I wish I could just start my own successful business and be rid of some of my financial troubles. Out of curiosity, I did see a manual for sale online last year for about $200, where you could get into the foreclosure home clean up business . . . where you would be hired by lenders and R.E. professionals to go to a foreclosed property (after the occupants had moved out), and basically clean up the house and yard from top to bottom . . . to make it showable to sell and to make the house look tidy and not be an eyesore to the neighborhood. It seemed like a good idea, but I did not want to spend $200 for the manual and then worry about trying to market the business. Since you are in California as well, do you think starting a business like that would still be successful in today’s market or is that market over saturated with companies already doing this? Yet since I am unemployed, plus I have several friends that are unemployed, if this type business is lucrative enough (while foreclosures are on the rise), jumping into a business like this sure would help me and my friends tremendously . . . as long as we could get paid rather quickly upon completion of doing each job. Yet if I do get into R.E., I will take your advice about having another job to sustain me, while waiting the get the R.E. Agent gig off the ground.

Yet it was sad to hear that you had been in business for 23 years and it went under. Good luck to you and your family. I am glad that you are seeing the light at the end of the tunnel. For sure, it sounds like you and your family have been through quite a lot. If you don’t mind my asking, what type of business did you own for 23 years that eventually you decided to get out of it due to the downturn? I myself used to have my own in-home full service travel agency for several years, however with the popularity of the Internet and people booking their own travel, I never got my business off the ground and I had to close my business last year. Yet I got into this business too late, because when I started my business in 2004, there were many former brick and mortar travel agencies around Los Angeles that had already gone out of business by then.

Thanks a MILLION SleepWellNow, I appreciate all of your help and advice.

[SleepWellNow]

You are correct there are a lot of short sales happening these days. There also are a lot of agents going after this business. To best serve your clients, you will need to go through training specifically for short sales and should become certified as a distressed property expert. The short sale business is very time consuming and stressful for both the homeowner and agent. You really need to know what you are doing. Many agents will not even get involved with one. However, some agents are doing a tremendous amount of business almost exclusively doing short sales.

It’s my belief, the reason you are seeing real estate companies continually advertising for agents is because of the turn-over. Many agents have quit the business in these hard times and others getting into the business leave after a short time because of the costs and time it takes to finally see a paycheck. A new person can go months and months without an escrow closing. If you are serious about this business, go to one of the meetings and see what they are offering. Many companies like Century 21 and Keller Williams will offer assistance in getting your license if you agree to work for them. You can expect your “split” to be low at first because they have to recoup their training and license expenses with each recruit.

I know there are many companies out there that are preparing REO homes for sale. Many are contractors out of work because of this economy. I don’t know what the market is like in your area but, from what I have heard, the bank does not pay for the work that was performed until escrow closes. So, I wouldn’t expect to be paid upon completion of the work. It may take a while.

I wish you success in whatever you choose to do.

[BrokeIn2011]

Thank you so very, very much SleepWellNow. I greatly appreciate you taking the time to elaborate and give me more detailed feedback on my questions, as it certainly is a tremendous help, and gives me quite a lot of food for thought. Yet it was interesting to be enlightened on short sales, WOW!!!

It was great to learn your thoughts about that one real estate office in Long Beach (the office that has at least 2 career open houses each week). Yet I guess if people do not really do their homework before entering into the real estate field, they can really be clobbered by all of the fees to get up and running and maintaining their R.E. career until they can see their first paycheck and start to close regular escrows to stay afloat. Yet it was great to learn how Century 21 and Keller Williams works, in regards to new recruits. Yet since you suggested taking on this endeavor part-time, I guess it would not hurt for me to go down to that office to check things out to see what they are offering.

Also, thank you very much for your feedback about the companies out there that are preparing REO homes for sale, which some are fueled by the many out of work contractors. Yet that was a bummer to learn that the bank may not pay for the work that was performed until escrow closes. MAJOR FROWN!!! So in this economy and if that is the way things work with a business like that, it does not sound like a good or lucrative business to be in, just because one might have to wait a long while until escrow closes in this very bad real estate market. Yet I appreciate the insight you have provided to me on this subject.

SleepWellNow, thanks a MILLION for everything, and I wish you and your family much success. Hopefully all of your problems are now or are almost now behind you.