A Q&A with Auction.com’s EJ Kite
Understanding REO best practices can be challenging. Much of the difficulty lies in trying to adequately gauge the market.
In September, Five Star put together an REO brain trust at their annual conference in Dallas to discuss strategies and solutions for navigating the REO market.
One of the sessions, called “Preparing for the Future: REO Market Update,” included panel member EJ Kite, Auction.com’s VP, Client Performance Management. Kite recently addressed some questions that surfaced after the Five Star session.
How are Auction.com clients selling more to foreclosure buyers?
Our clients all have their own unique strategy. Auction.com tools and services are not one size fits all. We customize solutions that help our clients to be more effective and reach their strategic goals. As a part of that, setting the credit bid correctly at foreclosure is integral to success. We use historical data, analytical tools and auction experience to help each client adjust accordingly in order to zero in on their goals. We fully understand that the road to success can be more like a marathon than a sprint. Our team is laser focused during the entire process and we’re able to continue optimizing with clients throughout.
We’ve seen a continuing shift in foreclosure sales, more and more selling to third-party bidders. How has this impacted REO inflows and supply?
The continuing shift starts with banks and non-banks working with defaulting borrowers from the day they become delinquent until the only choice left is foreclosure. Successful loss mitigation efforts, a declining delinquent inventory, and pricing to sell to a third party at foreclosure all help to reduce REO inventories across the nation.
While these positive actions help to reduce REO inventory, we still see pockets where the current REO inventory is aging, and at times, growing. Reasons include market compression and some areas simply not fully recovering post-financial crisis.
Another cause is the devastation caused by winds, rain, fire and flooding. Our focus shifts immediately to those families affected by storms to provide the necessary relief needed. In these areas, as time goes by to repair and rebuild, often there is no supply for months while moratoriums are in place to prevent loss of home to foreclosure/REO. When those periods are over, and all loss mitigation efforts have failed, we do see large spikes of inventory where there had been very little for a long time. Investors are not always prepared to purchase larger volumes. Auction.com leverages data science to hyper-target assets coming to auction with massive marketing efforts going out to millions of users. Leading up to an auction event, we continue to educate buyers and refine the marketing focus using all our digital channels to ensure we can maximize the sale of an REO asset at Auction.
With 93,000 unique visitors per day to Auction.com and over 5.5 million searches per month, we continue to see new users become asset buyers on our platform. With data and information we help clients maximize their REO and foreclosure disposition strategies by optimizing the opportunity for buyers and sellers to interact.
If you have questions, contact EJ Kite, VP, Client Management, at ekite@auction.com