I performed a BPO on a house in a short sale situation a couple of months ago. The house was OBVIOUSLY priced way below market even for a short sale and I realized that before I even saw the house just from the listing, tax records and comps. When I got there, the house was very nice, had had obvious and extensive upgrades recently (and the home improvements loans to show for it). The listing agent showed up for about five minutes, then turned me over to an unlicensed "short sale negotiator" who proceeded to do the suspicious song and dance about non-existent problems with the house. Including the supposed dire need for an entirely new roof on a house that looked like the roof was less than a year old. And a $50,000 solar system add-on, not even a repair item!

I said to myself, here's another one trying to pull a fast one. I especially thought so as I leafed through the "comps" they had tried to get me to use. This was a house over 3000 square feet on four acres and the comps were like 900 SF on less than one acre. Also in the "package" was an offer to purchase at a price at least $100,000 below even a fire sale price.

The BPO company asked for non-short sale, fair market comps. I provided a BPO based on that, the value of which, incidentally, came in right around where the listing agent had initally listed the house a few months earlier.

A week or two later, I got a message from the "short sale" dude, yelling at me that I was incompetent, blah blah, came in way too high, and that he was going to hire a licensed appraisal to "make me look bad" to the bank. I didn't respond, I've heard guys like this go off before and figured, let him throw away a few hundred bucks on an appraisal if he wants, the appraiser isn't going to come in much different than I did.

More than another month passes, then last evening when I was out of the office for a bit, this guy starts calling my number repeatedly and leaving threatening messages saying that he was going to "utterly ruin me", "run me out of town", he "knew where I lived (and gave my home address) all kinds of crazy crap if I didn't change my valuation. I came back to the office, saw all the messages, and had just finished listening to a couple of them when he calls again. I picked up the phone, asked him if he was the one who had left all the threatening messages, and when he said he was, I told him I was calling the police and hung up.

The idiot called me back TWICE MORE after that with the same crazy threats.

Long story short...I called the police and asked that they file harrassment charges on him. I am also considering reporting the listing broker (who is double-ending this deal, by the way, wanna bet there is an undisclosed dual agency problem here?) to the real estate commission for hiring someone who attempted to sway my valuation by using threats and intimidation. I also happen to think there is at least an 80% chance this short sale has fraud involved somewhere. NO ONE gets as insane as this guy did over the couple thousand a legitimate short sale negotiater gets out of a deal, he must have been counting on a LOT more than that and the only way that could happen would be through some kind of fishy flip or flop.

What do you think? I called my attorney this morning as I am going to come in with both barrels blasting if this fruitcake tries to make trouble for me or actually tries to make good on his threats.

Don't you just love the BPO business?

I think the police call is a good move. I would also report it to the BPO company that you did the report for. You probably should not have accepted the comps from him when he gave them to you. Finally, I would call the managing broker for the company and explain the situation, or better yet have your managing broker call their managing broker. I'm sure they don't want to get in the middle of a law suit over some rogue agent's fraud attempt.

Ellen, I wish I had your guts. I had a similar (but not as bad) situation with a short sale negotiator. It was on a listed vacant house on combo. I told the negotiator I would be there at a certain time and I actually showed up 10 minutes early. I saw him drive up as I was leaving. Well he called me several times that afternoon and even emailed me the comps he wanted me to use. He also said he would ruin me if I came in too high. I contacted the bank who issued the interior and even forwarded the nasty email with the comps to them. They put the order on hold while they contacted their client. Noone seemed to care at all. They just told me to proceed with the order. It just kills me how these banks make a big deal about us notifying them if something like this happens and when we do, they dont do anything about it. Its almost as if the bpo companies are hanging us out to dry when these things happen.

I accept the comps and then ALWAYS state that I will seek my own comps. If I ever do use a comp "suggested" to me, I note it in the report as such and only do it when it is actually the best available. In fact in such a case I usually pull a one line listing summary of the whole neighborhood and keep it on file, just in case.

The reason I accept them...on "iffy" deals like this they are very handy for backing up my suspicions of a deal. In fact, I just sent that background material to my lawyer, who is going to help me draft a letter to the managing broker. And in my case, I AM the managing broker.

And yes, I notified the BPO company.

I'm not so sure they don't do something about it that we don't know. For instance, the last time I had a similar situation to this (but not as bad, I've NEVER had one this bad) I noticed that the agent involved lost the listing and also disappeared from the roster of the brokerage he had been affiliated with.

You know, a year ago I probably would have just gotten upset about this but let it pass rather than raise a ruckus. But I am getting to the point where I am just sick to my stomach at all the fraud, bullying, pressure to use bogus comps, the crap we're put through over a $80 BPO.

If they push me, I am going to push back. HARD. I think we all need to do that so they know they can't get away with it.

And one thing is for DARNED sure, I am not going to take even the slightest risk of going down WITH THEM in their frauds because of caving to bullying.

I would call a local TV or newspaper reporter. They love stories like this in this economy. They can approach him with camera and microphone and out him on TV.

One quick question whose answer isn't apparent from reading the above . . . . are these Short Sale Negotiators now required to be Licensed in your jurisdiction?

And who actually hired this Negotiator . . . . the Seller, the Buyer, or the Listing Agency?

Whether Licensed by the Banking and Insurance Commission or by the Real Estate Commission, behavior like this surely would be prohibited.

In what State or Commonwealth is this activity occurring ?

All great questions. Negotiaters are allowed to perform LIMITED services regarding a short sale but providing comps and opinions on repairs and challenging the BPO probably aren't among them. Also there has been a large crackdown on unlicensed people doing anything that would give the appearance that they are licensed. I didn't know this guy wasn't until yesterday.

The listing agent actually OWNS the company this guy works for, which muddies the water even more. Who knows how he is getting paid.

And yeah, licensed or unlicensed, this kind of behavior is definitely not permitted in this state, which is Colorado.

Ellen:

Since the property was listed, I assume the MLS sheet was attached to your report. My question is how did the MLS remarks describe the property?

So often I will see MLS remarks give the subject glowing reviews, and then come BPO time the LA (or short sale negotiator in your case) wants to rake the home through the coals. When that happens I tell them, "How can I throw this home under the bus when your not willing to do that with your own listing? I'm not going to stick my neck out if your not!" That always shuts them up.

Good luck Ellen with everything. I hope this scumbag doesn't give you anymore trouble.

Thanks. And you nailed it, glowing description in the MLS.

It would be a cold day in hell when anyone tells me what comps to use, expecially a pinhead, unlicensed "short sale negotiator." LOL.

the ethical duties of licensed agents and appraisers are very clear under the state licensing laws.

unfortunately, ethics isn't, or hasn't been a priority in this industry.

In MA, it is technically illegal for anyone unlicensed in RE to even discuss matters regarding RE in a professional manner. For instance, many firms will not allow their unlicensed receptionists to give out info on listings because they don't want them to give the impression of that person being a licensed RE agent.

I would call the other broker and ask them if they are aware that they have an unlicensed individual handing comps out at one of their listings. I would also notify your board.

I would also ask how long the unlicensed individual has been working for them. The threat to the broker of putting their license in jeopardy and risking commissions that they've already spent and may have to pay back, will probably clear this right up.

I'd give him the "treatment" It can vary depending on what I can get away with.
I'd find out where he works, hangs out, etc. I'd minimally f*** his vehicle up. Key it, break off side view mirrors, slit tires. If I could catch him stumbling out of a bar I might beat his azz, if no witnesses.

Suspicions of mortgage fraud should be reported to the FBI, not locals. Possibly the state's attorney general and definitely, in this case, the state licensing board. Definitely locals for threats to your safety but I wouldn't count on them to investigate the mortgage fraud.

http://www.fbi.gov/about-us/investigate/white_collar/mortgage-fraud/mortgage_fraud

I've never had that happen, I would be terrified and applaud you for how you're handling it.

Amen.

The police won't do anything until this person hurts the person he's threatening.

I say, "Nip, nip, nip it in the bud". DIY.

This is one of the reasons why I carry a gun, and have a few in the house too. Too many nut jobs in this world.

The police did in fact, give this guy a visit and they are filing charges.

I am now debating whether to call the FBI as well. If I knew for CERTAIN this was fraud, but I am hesitant to do so on just a gut feeling.

And yes, on the number of nutjobs.

I have been thinking about this a lot and I think what we are seeing here is the result of the increasing desperation out there. Many agents and other people involved in real estate are really starting to lose it from the loss of income, the stress and generally bleak outlook. For some people, that means they stop worrying about ethics and the rules and are just out there trying to make a buck by any means available.

The fact that this guy went totally nuts over a deal that quite frankly, never had a chance of getting to a closing speaks volumes to what is going on out there. It feels like the Wild West.

Be careful out there, people.

Sounds like experiences I have had with these 3rd party people and there ridulous comps and pages of repairs. If it is such a **it hole, why would anyone want to buy it?

Another thing I been noticing is some of the big mills and there QC's with suggested comps or "we have a prior which is much lower". please look at there comps and comment.

I had 1 today and responded to there email: The comps I provided are best found in nearest proximity, best matching subjects features, age and condition and original order stated that fair market and NOT distressed value was needed. I have made no changes to order. They closed it out without further communication.

You rock Ellen 45! I don't post often, but this one drew me out.

Can't say I've had that much pressure from short sale 'negotiators,' but I've had a few interesting experiences lately with one bpo mill. I got this as a QC comment on a rejected bpo. "Your value is well above the current list price of the home."

WTH? The QC guy got a really fast email back from me asking if it was my job to meet the list price of the bpo. No answer to that from him. The bpo has now sat in the 'awaiting approval' line for a while with no approval. I spoke with two other QC people who added my comments to the order and agreed with my opinion.

I had to ask myself, who is working for whom in the whole foodchain.

TexasGal you are so right. I try to always do the right thing and the banks NEVER care. Collusion this, fraud that....but they don't do anything.

Your professional manner is awesome Ellen. I would sue the company who the idiot works for, make sure you get a settlement amount for stress and whatever else a civil attorney can come up with. I hope this happens to me as I would consider it hitting the lotto jackpot or should I say lotto crackpot. I would also report it to the FBi and you may have just eliminated a source for fraud and remove one of your competitors. People have to be responsible for their actions and I hope you take them on.

Ellen - you're a hero!!

You calm resolve is a thing of beauty - I am so impressed.

I also wonder, how did the fruitcake find these comps and in what form did he hand them to you in?

You state the company the fruitcake works for is owned by the agent that listed the house - but is he the broker of the firm he works for?

What I am getting at - you might be able to have your MLS and Association come down on the agent and the firm that agent works for - and this seems to be worth investigating as we need to rid our ranks of such people.

Then there is always you state licensing authority - without accusing the agent of anything - just drop them an email of these events and what you have found out - the police reports and all.

There are many desperate people out there doing some really risky things - so be as careful as possible - but contacting the police was a great first step - no do something to protect yourself as well.