G.M. Filisko is a Chicago area freelance and former editor for REALTOR® Magazine.
Profile: Sellers Need Quick Solutions
Ralph Roberts Real Estate Inc. launches innovative solutions for clients through cash-buying and foreclosure departments.
February 1, 1996
Ralph Roberts Real Estate Inc.
President: Ralph Roberts
Location: Warren, Mich.
Size: About 35 salespeople
Innovation #1: Cash-buy department
"There's a saying that you don't make a lot of money in real estate sales; you make a great deal more buying, owning, and selling your own real estate," says Lanette L. Louwers, cash-buy and sales department manager. "I think that holds true."
That's why the company hired Louwers to work with sellers who want to cash out of, rather than market and sell, their property. "For example, if sellers need to do a lot of repairs, I tell them, 'If you were to do x amount of dollars' worth of repairs, list your home, sell it, and then pay a commission, you'd probably end up with this figure,'" says Louwers. "Often, my cash-buy offer is equivalent to that figure, and cash-buy is a much faster and easier way to get out of a property."
The company finances cash-buy purchases with its own money or through equity lines set up with local lenders. The cash-buy department brought in about 50 of the company's approximately 500 closings last year, and its profits totaled about $300,000.
Innovation #2: Foreclosure department
"We help folks who are in foreclosure," says James Scandirito, an attorney and vice president of foreclosures. "We explain the alternatives to losing their home, such as selling, refinancing, using a lease option or a land contract, or filing for bankruptcy."
The company offers the service for two reasons: It helps consumers deal with a difficult situation, and it's profitable. "We try to create a win-win situation," Scandirito says, "where the company wins financially and by helping people. And consumers win by saving their home."
Scandirito scans legal publications for lists of sellers in foreclosure and then sends a series of letters explaining the company's services. "Most letters that sellers get are from people wanting to buy their house, but that's the last thing we want to do. We want to help them save their home," says Scandirito. "I send a letter saying that I'm sorry to hear they're in foreclosure but that they have a lot of options."
The company offers various solutions. For instance, it may refinance the sellers' loan. Or it might offer a land contract or a lease option, and then after the sellers make a steady stream of payments, the company will refinance the loan.
Scandirito runs into several problems working with distressed sellers. For instance, not every home can be saved. "There are times when there's really nothing we can do," says Scandirito. "And we just try to give the best advice we can."
The other problem is that many sellers are simply too embarrassed to ask for help. "A lot of sellers are in denial," says Scandirito. "They think that if they don't worry about their problem, it'll go away. That's probably the biggest stumbling block I run into."
Notice: The information on this page may not be current. The archive is a collection of content previously published on one or more NAR web properties. Archive pages are not updated and may no longer be accurate. Users must independently verify the accuracy and currency of the information found here. The National Association of REALTORS® disclaims all liability for any loss or injury resulting from the use of the information or data found on this page.