This post started as a comment to Matthew Rathbun’s brilliant post.   At the end I decided to make it a post

Truly a great post, Matthew!

I believe that the bulk of the clamor for “more professionalism” that emanates from agents is mostly self-serving gibberish. A person gets into real estate and then observes that the public does not tend to hold Realtors in extremely high regard. Personally, they want to be held in extremely high regard but can’t really see how they can differentiate themselves in the eyes of the public from all the other Realtors – so naturally, establish how “professional” they are by endlessly talking about how “unprofessional” some other Realtors are.

All the while, without once ever bothering to even trying to define “professionalism”.

You hit the nail on the head here with regard to more education: lawyers, for example, are all “highly educated” and yet are not much more highly regarded than Realtors. Why?

Professions that are “highly regarded” tend to be professions where the advice being given is *exclusively* for the benefit of the public or the person receiving that advice: a librarian, for example. The librarian’s personal biases and preferences may well be part of their recommendations – but few people would suggest that certain books get recommended for reading so the librarian can get extra money. The same “high regard” holds true for professions like nursing but tends to fall off a bit when it comes to physicians (they *are* sometimes thought of as money motivated).

We are all salespeople and therefore will always be – rightly – regarded by the public as salespeople. Some of us are quite “professional” at selling, some aren’t. No set of rules or regulations is going to cause people who have low or questionable morals to suddenly act right. Enforcement alone does that.

What would have to change is the complaint procedure – so that agents (who are in a *much* better position to observe wrongdoing) can easily, and in a very short amount of time, file a complaint (sort of like calling 911). Then the investigation and enforcement unit would have to be able to actually look – instantly dismiss complaints without merit or grudge motivated complaints – and take swift action. In short, we would have *real* justice. As we don’t have such a thing (real justice) anywhere else in our society – in this country or any other – I’m not holding my breath waiting on that one.

The most effective thing one can do is to BE the change they hope to see in others. That isn’t an original thought of mine. But I don’t know a better one.

Bank of America is to be Highly Commended for their complete willingness to give so many intellectually challenged people jobs as executives. Sure, year in – year out, most other banks have always been willing to hire a few people who couldn’t think straight. But those other banks aren’t getting any awards for what they did for one simple reason: what they did was so darn common. Now any buzz kill who cares to can go look and find some other division of Bank of America / Countrywide that isn’t being run totally by retards (for example, their REO loss mitigation department).

But I challenge anyone to find any other bank that even comes close to Bank of America / Countrywide’s short sale loss mitigation departments for non-stop, over the top policies and procedures that make life difficult, impossible or at least a lot less profitable for the following four groups (not listed in their order of importance and there may well be others).

• All agents – either on the buyer or seller side
• All potential buyers of any property where B of A holds a 1st lien position
• All of the sellers (their borrowers) trying to work with them to avoid foreclosure
• Themselves.

If B of A is in a 2nd lien position, oddly enough they have workable policies in place (seller IS going to sign a note prior to close to pay the bank a small part of what they owe). They don’t flex on this issue but it is a knowable and not completely unfair rule. If they are in 1st lien position their standard and unvarying behavior (if that behavior were being attributed to an individual person) is nothing short of psychotic or completely retarded – at least down at the imbecile level. No rational judgement, no possibility at all of dealing with them the same way we deal with all the other banks on short sales.

Other than limited personal – and for the most part, completely anecdotal data, most agents doing short sales on the buy or the sell side have a very odd picture of the overall scene. Loads and loads of mostly worthless gibberish. Notice how Chase and Wells Fargo are grouped in the same category as Bank of America? Wells does not ever pay any of the buyer’s closing costs and won’t pay for a home warranty. But ….. you can routinely close an escrow from start to finish with Wells in about 30 days. Actually close, it takes less then two weeks to get an approval. Same with Chase. Try that with B of A / Countrywide (who collectively have about half of all problem loans in the U.S.) It takes a minimum of 90 days to get any response back from B of A. And if you send them anything after submitting the original package (anything, even a better offer) that 90 day clock is reset. So, with B of A four to five months to actually close a transaction is not uncommon.

It gets better. Here is a charming response we received from B of A a month or so back:

“Bank of America is now requiring most sellers to contribute to the loss in order to qualify for a short sale. Please prepare your client for that probability and be ready to let me know how much cash the seller can bring to closing. If no cash is available, the alternative is a promissory note for a larger portion of the loss. this requirement is firm–no contribution from the seller will result in the short sale being declined. There are vary few exemption made to this. The approval time once the file has been submitted will depend on the size of the loss, the investor and the MI insurer, if any.”

Arizona is one of ten states that have “anti-deficiency protection” due to the nature of how foreclosure works here – it takes only 90 days from the time the lender files for a Trustee’s Sale for them to take the house back. Therefore, the anti-deficiency protection (very basic rules – there are others: The same purchase money loan is still on the property, e.g., they never took any money out of the house via a refi and it was a residential property of 2.5 acres or less).

The response from B of A above was on a transaction where our seller would have no possible liability of any kind if the bank were to foreclose. None. In this case there was precisely nothing they could legally do to go after him and yet, even after being told this and being asked to please verify it with their legal department, they were not willing to budge – forcing the seller to let them foreclose. They get a house back that they really don’t want for many reasons, a neighborhood winds up with an abandoned home that will invariably sell for less money after the bank gets it back and so it goes.

It is as though a complete division of Bank of America executives went looking and anything they found that could slow down the process, make it more difficult for everybody involved or simply thwart the actual goal completely – they carefully noted what that was and then adopted it as firm policy. I’m impressed.

This was just now posted on AzCentral with the headline, "Foreclosures surged in July.  This is what passes for "reporting" by most media about the real estate market.  June foreclosures were 5,149.  July’s numbers (per the article) were 5,316.  A difference of 167 foreclosures or 3.24%.  And that is being called a "surge".

I wonder if anyone’s paycheck went up at an annual rate of 3.24% they would ever consider it a surge?

This isn’t to suggest that the number of foreclosures going up is ever a good thing – just that reading past the headlines and actually looking at the numbers might shed a bit of light on the subject.

If anyone cared to truly examine some relevant market statistics for the Greater Phoenix area here are a couple I personally find quite interesting: The current "success rate" for all listings in ARMLS is 64.8%.  You can see that (along with some other very interesting numbers) here.  But since most of the sales occurring are lender owned properties, that number doesn’t mean too much to me.  Let’s break it down.

Scroll down on this page and you will see the breakdown, based on types of listings.  The success rate (percent of all listings of that type that sell) for lender owned is 91.4%.  Not very surprising – at least not in our market.  But look at the comparison between "normal listings" and short sales.  The numbers are almost the same!  Normal listings success rate is 50.2% and short sales success rate is 49.4%.

I know, I know, the normal listings stat surged way ahead. 🙂

For Immediate Release: Arizona MLS Takes Stand on “Scraping” and “Indexing”

RECENT NAR INTERPRETATION CREATES COMPETITVE DISADVANTAGE FOR REALTORS®

PHOENIX, AZ – JUNE 10, 2009 – The Arizona Regional Multiple Listing Service  (ARMLS) is taking a stand on a recent National Association of REALTORS® (NAR) ruling on the technical interchangeability of “scraping” and “indexing” as it pertains to display of the IDX Database on the Internet. A recent controversial interpretation issued through the Center for Real Estate Technology (CRT), NAR’s technology arm, advised members that “scraping” and “indexing” are in effect the same practice and represent misappropriation of the IDX Database. ARMLS believes that this ruling places NAR members at a distinct and serious competitive disadvantage. ARMLS maintains that the CRT opinion does not factor in the end use of the “scraped” and “indexed” listing data. It fails to distinguish between benign and malicious “scraping” and “indexing.” These practices are termed benign if they provide intended benefits to the consumer and the buyers and sellers whom the REALTOR® serves, and are not in conflict with the ARMLS IDX Policy. They are deemed malicious if they utilize the listing data in a manner foreign to the original intent of the REALTOR® and the property owner, and are incompatible with the ARMLS IDX Policy. The practice of “scraping” or “indexing” by search engines for the purpose of displaying or indexing the data for consumer property search, and which ultimately directs the consumer back to its source, is benign, and is in sync with the REALTOR’S® intention when displaying listings on the Internet. When a third party, e.g. a search engine, through “scraping” or “indexing” misappropriates and uses the listing data for purposes not intended by the property owner or REALTOR® , these practices become malicious and should be prohibited. Any interpretation by NAR prohibiting REALTORS® from allowing search engines, such as Google, from benign “scraping” and “indexing” listing data puts the REALTOR® at a distinct competitive disadvantage. The ARMLS IDX Policy contains the statement that “IDX Brokers must protect the IDX Database from misappropriation by employing reasonable efforts to monitor and prevent “scraping” or other unauthorized accessing, reproduction or use of the IDX Database.” The interpretation of this policy was not intended to discourage dissemination of listing information through search engine indexing or to discourage brokers or their permitted licensees who offer listings from optimizing their listings to achieve higher search engine placement. ARMLS supports and encourages a change in NAR’s interpretation of “scraping” and “indexing” that factors in the results of such activities and removes any competitive disadvantage that NAR’s current opinion creates.