All Forum Posts by: Mike Madden

Yes and no. I brokered almost all REO deals to survive during the dark years. It works this way. Some giant bank, usually in the Northeast gets boxes of foreclosure files. The bank then assigns these foreclosures to various asset management companies (AM) all over the country. The AM then hires a local broker to find out if it's occupied, then send pics and descriptions back to the AM. If it's occupied, the broker is usually authorized anywhere from $1,500 to $3,000 to ask the occupier to leave, and leave the property in broom swept condition. And yes, the cash for keys can be paid to a squatter!

Once the tenant leaves, the agent (or the AM) hires contractors to change the locks, trash out, clean up, landscaping, & repair.  The agent will then perform endless broker price opinions on the place.  Hopefully, the agent gets to list and sell the property and earn a modest commission. If the property sits on the market too long, the house goes to a national auction firm.  So, per you comment about tenants occupied houses during an auction, ...I've never seen that happen.  Hope this helped!