Cartus Network® Asset Recovery
Specialist (CNARS)
How to Maximize Your Success
as a Certified CARTUS Network
Deed in Lieu Specialist
2010
Program Agenda
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Overview of Deed In Lieu Plus (DIL+)
Contacting the Customer – 2 Critical Paths
Broker’s Price Opinion (BPO)
Program approval
o Client Approval
o Customer Execution of DIL
o Listing the property
o Marketing the property
• Fannie Mae DIL acceptance
o Cash For Keys
o Vacant Property Report
o Rekeying the property
o Relisting REO
Cartus Asset Recovery Announces:
Deed in Lieu Plus!
• Alternative to foreclosure for financial institutions
• Property Deeded to investor by borrower =
Customer
• Helps to eliminate expensive and adversarial
foreclosures
• Cartus manages resale of the asset
• Utilizes resources of the Cartus Broker Network
Benefits to Financial Institutions
• Saves costs of:
– Foreclosing
– Selling a distressed property at a low price
– Extended property maintenance
• Removes a non-performing asset from its
books
– Reduces reserve capital requirements
– Frees up funds for other investments
Benefits to the Customer
• Minimize adverse impact on his/her credit
• Eliminate a stressful financial situation
• Offers a means of transitioning to a more
affordable, long term housing solution
• Faster transaction than awaiting foreclosure
proceedings
Benefits to the Broker
• New stream of referrals
• Commission is paid at reasonable and
customary rate (5.5% - 2.5% - listing agent;
3% to buyer’s agent)
• The fee is 35% (paid on your split)
• Cartus and the lender are backing an
aggressive strategy to sell and close quickly
Agent Requirements
• Must be certified in Cartus Network Asset
Recovery Specialist (CNARS)
• Must be a full time residential Real Estate Agent
• Must understand the DIL+
• Must have strong influencing skills
• Must be able to provide an accurate and timely
Broker Price Opinion (BPO)
• Must agree to follow the strict Fannie Mae
operating procedures and complete all reports in
the required timeframes.
The Deed in Lieu Plus Program
• Cartus will obtain an independent Broker’s Price Opinion
(iBPO) and a BPO from Cartus Broker Network member
• Cartus will complete a title search on the property
• Cartus and Fannie Mae determine eligibility for program and
offer Customer Deed In Lieuhe property
• Cartus will work with Network agent to list the property
• Title passes from customer to Fannie Mae upon DIL
Acceptance
• Cartus and Network Broker Market REO property to obtain
sale
DIL+ Time Line
Day 45-60 Customer vacates property, Broker delivers Cash
for Keys, Cartus re-lists property and begins
REO Marketing
Day 25
Customer executes Deed In Lieu package
Day 20 Cartus notifies Broker to list property and obtain executed DIL
Day 20 Customer approved for program
Day 10 Cartus orders Title Search, Broker BPO, and independent BPO
Day 10 Customer provides verbal authorization to proceed
Day 5 Initiation Process - Cartus offers Deed in Lieu (DIL) to Customer – or –
Cartus orders Door Knock from Broker
Day 1 Cartus receives authorization from client
Initiation Process
Cartus will receive authorizations from Fannie Mae for Customers identified as
potentially benefiting from the program. There are two ways a Customer is
initiated into the program.
Path One – Cartus Initiates
Contact
Path Two – Door Knock
Services (Agent Initiates
Contact)
Path One - Cartus Initiates Contact
The Cartus Asset Recovery Consultant (ARC)
makes several attempts to contact the
Customer.
• The ARC will:
– Mail Customer Welcome Package
– Review the program with the Customer
– Complete Needs Analysis
– Obtain verbal permission to complete a BPO
– Place referral/order for BPO with Network Broker
– Order independent BPO
– Place Title Order
Path One – Agent Contact
Once ARC makes contact and obtains
permission to proceed, they will place referral
via Broker Center requesting BPO
• Assigned Agent to make contact with Customer
and to complete BPO
• Use a positive, upbeat greeting to introduce
yourself and your company
• Explain your role
• Explain the BPO Process
Path Two – Door Knock Service
The Assigned Agent will make two attempts to
make face to face contact with the Customer to
introduce the DIL+ program. Assigned Agent
will:
• Use a positive, upbeat greeting to introduce yourself and
your company
• Introduce Cartus Asset Recovery, client and the DIL
program
• Determine if the Customer has an attorney already
involved
• Provide the Customer with the sample Fannie Mae DIL+
Customer Introduction Welcome Package (Handout 2)
Path Two – Door Knock Service
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Utilize the DIL+ Agent Door Knock Scripting (Handout 3)
Ask permission from Customer to proceed
Provide background on Cartus
Highlight the benefits to the Customer of working with Cartus
1. No cost to Customer
2. Experienced Real Estate Agent
3. Dedicated Asset Recovery Consultant
• Customer to agree to move forward with program
• Update your Relocation Department on the outcome Door
Knock attempts
• Relocation to update ARC on outcome of Door Knock
Service
Path Two – Door Knock Service
Breakout Opportunity: Break class into teams
of 2 and have teams role play. Have one
team member play the Customer, and the
other team member play the agent. Utilizing
the scripting the agent should approach the
Customer to introduce the program,
anticipate objections, and overcome those
objections.
Broker Price Opinion (BPO)
Obtain objective, expert opinion of the value and
condition of the property
• Critical Function of the process
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Critical in mitigating credit losses
Critical in setting marketing strategy
Critical in negotiating sales
Critical in measuring Cartus and Brokers performance
MultiForms Software
• MultiForms is electronic forms software housing all
Fannie Mae REO management documents
• MultiForms is required to service Fannie Mae REO
properties and allows for auto upload into Fannie
Mae’s asset management system
• Cartus will only request Brokers purchase the
MultiForms software at the point of placing a referral
• Brokers obtain MultiForms by calling 800-235-1600
Broker Price Opinion (BPO)
• The BPO provides critical information to setting the
marketing strategy for the property determine if the
Customer and the home qualifies for the DIL program
• The completed BPO is due to Cartus within 3 days of
the appointment date
• Agent submits BPO with digital photos of interior and
exterior to Relocation Department
• BPO forms must be reviewed by the Relocation
Department before sending to Cartus
• The BPO is not to be shared with the Customer
Key Components of the BPO
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Current Market Conditions
Subject Marketability
Competitive Closed Sales
Competitive Listings
Marketing Strategy
Recommended Repairs and Improvements
Market Value
Comments
Photos
BPO – General Marketing Conditions
• Reflective of current marketing conditions
• Provide any additional detail in the
Comments section
BPO – Subject Marketability
• Pay specific attention to the Unit Type
• Provide any additional detail in the
Comments section
BPO – Selecting Comparables
 Relevant selection
– 3 Sold Comps
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Most recent - sold within last 6 months
– 3 Listed Comps
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Most recent
– Properties should be similar
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Size
Room count
Amenities
Age
– DO NOT use REO properties unless they are
predominant
 Adjustments are adequate
– Consistent and reflective of market
– Repairs indicated in separate section
 Include at least one “As Is”
and one “Repaired”
comparable
BPO – Marketing Strategy
 Opinion should be based on
• Target buyer needs
• “Dollar for Dollar” investment strategy
 Other considerations
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Owner-occupancy ratio
Under/Over improvement
Supply
Average Days on Market
Financing
Condition
BPO – Repairs
 Include those repairs you recommend
• Return property to “average marketable condition”
 Itemize and provide cost estimates
 DO NOT Include
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Maintenance items
Debris removal
Landscaping
Initial clean
BPO – Market Value
 Provide both “As Is” and “As Repaired”
values
 “As Is” market value should fall within the
indicated adjusted value of the competitive
comps
• State whether most weight is on the sold or listed comps
 Range of values not acceptable
BPO - Comments
 Be descriptive
 Inform reader of nuances not
covered elsewhere in the form
Common REO
Environmental Issues
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Lead-based paint
Asbestos
Discoloration
Oil Releases
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Methamphetamine Labs
Bio-Hazardous Conditions
Drywall
Miscellaneous
Lead-Based Paint
Which action to take depends on facts
Primary Concerns
oChildren under 7
o Court Order
o Must Disclose
Asbestos
Which action to take depends on facts
 Concerns
o Friable asbestos
o Location of the asbestos
Discoloration
Three Options
1. Sell As-Is
2. Clean
3. Remediate
Primary Concerns
o More than 100 contiguous square feet
~ (remove lockbox/sign waiver & release)
o Condo/shared wall situation
o Must disclose - can’t disclose as “remediated” if
only cleaned
Oil Release
 No Option/Must Remediate
 Primary Concerns
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Reporting requirements
No further action letter from state, if required
Threatened litigation
State agency involved
Clearance from EBI
Must disclose
Methamphetamine Labs
Primary Concerns
o Notice
o Remove lockbox/no entry until cleared
o Don’t complete eviction/trash out until cleared
o Must disclose
Bio-Hazardous Conditions
No Option/Must Remediate
Primary Concerns
o Potentially infectious material (PIM)
o Hypodermic needles
o Blood/suicides – murders
Miscellaneous
o Marijuana Houses
o Urns
o Buried Bodies
BPO - Photos
 Exterior and back of subject
property
 Include street scene
 Interior photographs – all rooms
 Point out issues or needs for
repair
 Exterior photographs of comps
(both sale and listing)
 Anything that may affect the
market value
Assistance in prepping your BPO
BPO Checklist
• Ensure all required
details are captured
Additional Assistance
BPO Completion Aid
Broker Price Opinion (BPO)
Relocation Department Review
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Must be consistent with current market conditions
Fully explain any market changes in the last 6 months
Must be typed
Must be thorough – no blanks - use “n/a” if appropriate
Include the appropriate market time and associated
value as indicated in the initial instructions
• Must include data that supports the most likely probable
sales price
• Must support the anticipated sale price, not influence
from the Customer’s expectations or needs
Broker Price Opinion (BPO)
Relocation Department Review
• The BPO includes recent (closed within 6 months)
comparable sales that support value
• If closed comparable sales are not available, explain why
• The BPO must include recommended strategies
• The BPO must include support for recommended
strategies, i.e., if you do X, the payback would be Y.
• The BPO must include 3 competing listings and a
discussion of the current absorption rate
Cartus notifies Broker to list
property and obtain executed
Deed In Lieu (DIL)
In this section:
• Customer Approved for DIL+
• Customer to Execute Deed In Lieu
• Customer and Broker Execute Listing Agreement
• Marketing the Property
• Negotiating a Sale pre DIL Acceptances
Customer Approved for Program
• Title Search complete and clear
• Deed In Lieu sent by Title Resources Group
(TRG) to the Broker
• Cartus will notify the Broker if the Customer
and house have been approved by the client
• Cartus will instruct the Broker to contact the
Customer to list the home
• Cartus will communicate the approved
marketing strategy to the Broker
Executing the Deed In Lieu (DIL)
• Deed In Lieu Package (Handout 11) sent by title
company to the Broker
• Agent to set appointment to deliver DIL to
Customer and list the home
• Offer assistance in helping Customer notarize DIL
• Send executed Deed back to Title Resources
Group (TRG)
Listing Agreement
• Utilize local Listing Agreement
• Executed between Customer and Broker
• Must execute Broker Exclusion Clause
(Handout 12)
Marketing the Property
• Initial list price established by Cartus Asset Recovery
Consultant (CARC)
• Enter into local MLS and provide copy of MLS listing
to CARC
• Customer listed as Seller
• Place lockbox on property and set showing
procedures with Customer
• Place and maintain signage
• Schedule a Brokers open house and a public open
house
• Place Listing on all applicable websites
Marketing the Property
MLS and Website postings
• Include positive comments to describe the
property
• Do not refer to property as Bank Owned, REO,
Foreclosure, or Short Sale in the comments
• Utilize appealing inviting words to describe the
property
• Take multiple and good photos – minimum 6
Marketing the Property
Marketing Updates are due every 2 weeks from
listing date and must include:
• Advertising efforts
• Number of showings
• Buyer feedback
• Recommendations on marketing and pricing
• Changes in property or market conditions
Marketing the Property
Inspect the property once a week and encourage
the Customer to make the property as appealing
as possible. Recommend:
• Lawn maintenance, weed removal, shrub
trimming, and snow removal as necessary
• Interior should be clean and uncluttered
• Kitchen appliances, bathrooms, windows and
mirrors should be kept clean and sparkling
• Working light bulbs should be in all sockets
What if I get an Offer?
Customer should negotiate all offers to the fullest
extent
• Utilize local real estate contract
• The sale must be made subject to review,
approval, and assignment to Fannie Mae
• The Fannie Mae Assigned Real Estate
Purchase Addendum (Handout 14) must be
included as part of the contract
• Must include any required disclosures
• Fannie Mae’s Lead Paint Disclosure (Handout
15) if built prior to 1978
Fannie Mae Acquisition
In this section:
• Cash for Keys (CFK)
• Re-Key
• Vacant Property Report
• Reimbursement Procedures
• Supplemental Listing Agreement
REO marketing begins!
Cash for Keys (CFK)
Provide financial relocation assistance to customer
resulting in the following benefits:
• Minimize the high costs associated with the
eviction process
• Expedite Fannie Mae’s ability to take possession
of the property
• Encourage ongoing maintenance until vacate date
• Encourages the customer to exit the premises with
more dignity and in the least confrontational
manner as possible.
• Leave the property in broom swept condition
Cash for Keys Process
1. Deed in Lieu signed by Customer
2. Cartus will send CFK check to broker (made out to customer) 5-7
days before DIL contract vacate date.
3. Agent to set an appointment with the Customer on date of vacate
4. Agent to confirm property has been left in broom clean condition and
completes the Vacant Property Report (Handout 16) walk through
5. Agent to have the Customer sign the Deed In Lieu Receipt
(Handout 17)
6. Agent delivers CFK check once verified property is in broom clean
condition
7. Relocation Department notifies Cartus property vacated and
fax/email CFK Receipt to CARC with customer’s new address
Cash for Keys Process
This is not broom clean …
This is broom clean …
Re-Key Process Steps
• Coordinate with Locksmith to re-key the
property at the vacate date if broom clean
• Place a combination lock box on the property
• Locksmith costs will be reimbursed up to
$120
• All locks should be re-keyed
• Please utilize your areas standard lockbox
(i.e., electronic) for co-brokerage showings
Vacant Property Report
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To be submitted to Cartus within 7 days of vacate date
Provide photos of each room
Provide photos of all defects
Note overall condition of the property
Review and note personal property remaining
Note if property is in broom clean condition
Note if appliances are clean and in working order
Vacant Properties
• Verify all major systems are operational (i.e., heat/air
conditioning)
• Pick up any residual mail or newspapers
• Inspect property weekly
• Notify neighbors
– Ask to keep an eye on the property
– Contact you immediately if necessary.
• Make sure all windows and doors are locked.
• Disconnect or unplug automatic garage door opener,
remove garage door controls from property.
Vacant Properties – cont’d
• Make sure pools are not accessible.
• Having shades, blinds or coverings on windows
promotes appearance of occupancy
• Check for signs intruders:
– Damaged shrubs or flowers
– Cracked glass panes
– Torn or misaligned screens
– Visible tampering of doors or windows
– Update internet listing and pictures as necessary.
Reimbursement Instructions
• Submit invoices for Door Knock Services to CARC
1. Utilize the Billing Invoice (Handout 20) found in
CartusNetworks.com within 3 days of completing
Door Knock service
• Submit Expense Reimbursement for Re-Key on the
Monthly Expense Statement (Handout 22) found in
CartusNetworks.com with in 3 days of Re-Key
1. Invoices and proof of payment must be included
to receive reimbursement
2. Re-Key expense limited to $120
Supplemental Re-List
Agreement
• Cartus will deliver supplemental listing
agreement to relocation department
including;
1. Commission
2. Commission Split
3. Listing Duration
REO marketing begins!