Top 15 Reasons Why I Stopped Brokering Foreclosed Properties

With each email alert I send to subscribers, it now includes a reminder that I have stopped brokering foreclosed properties. It’s a personal decision that has made our lives better, and this post will try to explain the reasons why.

Reminder: I might be stating the obvious, but I want to make it clear, since we have stopped brokering foreclosed properties, we can no longer entertain inquiries about any of the foreclosed properties in the listings I share… it simply does not make sense! So please go to the banks/lending institutions directly to inquire and get additional details, thank you for understanding.

Actually, so many of our friends and colleagues have been wondering why I stopped brokering foreclosed properties, and I often have to give a lengthy explanation, just so they’ll understand.

Well, I am tired of explaining, so I’ll  just explain everything in this post.

Anyway, this is long overdue, so here goes…

My top 15 reasons why I have stopped brokering foreclosed properties

1.Change of priorities – I simply have to take better care of myself, my health, and family matters. This means I have to be physically present (and also physically fit) and give undivided attention (no multi-tasking, no phone calls, no trippings). Not that I didn’t take care of these things before, it’s just that it now takes more of my time.

As mentioned in my post on how I was able to stop diabetes, I also need enough exercise and enough sleep, so no telephone calls late at night and the wee hours of the morning. I believe this has also helped me manage my hypertension very well.

If you think about it, we strive to achieve the freedom to do what truly matters, and for me, I am setting aside brokerage for this purpose.

2.Brokerage must be done full-time – I believe that in order to attain a worthwhile level of success with brokerage, it deserves focus and dedication. In other words, it has to be done full-time. In order for me to do justice to brokerage, it deserves my 100%, but because of my change in priorities, I simply can’t.

3. It feels awkward – As someone who advocates smarter real estate investing, some people see my honest advice (In summary: not all foreclosed properties are good deals) as discouraging them from buying. Of course, I can just shut-up and let people buy those properties so I can earn a commission, but that would be totally wrong.

Which is why I end up saying my honest opinion, and at times I get a question like “Are you really trying to sell properties… It’s like you are discouraging me?”. Awkward!

4. Highest and best use – I would rather focus on doing the things I am passionate with, things I love to do, and would have a bigger impact to humanity (Ayos ba?!). But when it comes to brokerage, I have to admit that there are some aspects that I really hate doing, and I end up asking myself “Why the heck am I doing this?!”. The solution is to build a team so that people who are passionate about the things I don’t like to do, can do those things.

5. Brokerage needs focus in terms of location, and/or the banks you want to focus on. This requires building a team that can do the legwork.

6. Building a team takes time and effort, and I can’t do this right now because of my priorities. By the way, we actually tried to partner with a number of people, but sadly, those did not turn out so well due to issues, so we had to end those partnerships. One turned out so bad, refer to #10 to have an idea.

7. It’s hard to focus on your own deals when other people are asking you to find good deals for them. If you are an investor who is also a broker, you will understand what I mean. Guess what, after quitting brokerage, we suddenly have a deal that came out of nowhere!

8. A higher purpose. As Tim Ferris said in this blogpost, we should focus on doing our true calling, the reason why God put us here on earth. Tim said:

“ARE YOU DOING WHAT YOU’RE UNIQUELY CAPABLE OF, WHAT YOU FEEL PLACED HERE ON EARTH TO DO? CAN YOU BE REPLACED?”

In other words, if something can be done by others and you can be easily replaced, then maybe that is not your true calling. This was exactly what I felt when it comes to brokerage. Not that I am downplaying real estate brokerage and other real estate brokers, or anything like that. I just feel it’s better to let someone else do it.

In the same article, Tim also said:

“Are you squandering your unique abilities?”

It was like a wake-up call. I would rather focus on using my unique God given talents to serve His purpose.

9. We don’t want to be a bottleneck – Getting property information is crucial to deciding to buy a foreclosed property or not.  But getting complete details for a foreclosed property is hard, it takes a lot of time and effort. As a broker, it will likely be your responsibility to get that info.

Unless you have a team, you will realize you can’t do everything yourself, and you will just become a bottleneck. But as mentioned earlier, building a team for brokerage is not my priority right now. Frankly speaking, I would rather build a team for something else, something bigger (It’s a secret for now… hehe!).

10. Challenges working with other brokers – It’s so frustrating to deal with unprofessional and unethical real estate professionals, and also colorums, even with the RESA Law! I just wish it had more teeth and good implementation so that those who are violating the RESA Law will not go unpunished.

It’s disheartening to see a few bad eggs tarnishing the real estate industry, and I’m just sick and tired of it. I still have high hopes that there will be better enforcement/implementation. Without it, legitimate brokers will get bypassed and scammed by other unethical brokers. Which is why I would rather own properties than just broker them, and now we focus on our own deals.

11. There are so many grey areas when it comes to brokerage right now. For example, how do you handle taxation between brokers and salespersons? For us we stick to conservative practices and it means a lot of taxes to pay, which affects minimum percentages to make it all worth the effort. most of the time, it’s simply not worth it.

12. It’s a logistical nightmare because of the horrible traffic out there, coupled with the inefficiencies in real estate transactions. If you have been into real estate you know there will always be legwork and other things that would require your physical presence. Yeah, you can outsource, but only up to a certain extent. One perfect example: if you become a broker, you can say goodbye to your weekends. 🙂

13. It’s too stressful -I quit the corporate world to get rid of stress, it’s bad for my health. But when I tried brokerage, it’s like the stress got even worse. I remember the time when I took a break from everything to give my back-injury time to heal, and I suddenly enjoyed the feeling of not being a broker, and my feeling was, I should have quit as a broker a lot sooner.

14. No need to hide bank details. This is probably the best thing about not being a broker, because brokers usually have to hide the bank details, either to prevent prospects from going straight to the bank, or prevent other brokers from stealing clients (listings from banks are non-exclusive and offer little protection to the original brokers). This can get complicated when almost all listings have bank details embedded.

Since I do not broker foreclosed properties anymore, I don’t have to worry about these things, and I can share listings as they are, quickly! Anyway, this was actually how I did it from the start.

By the way, I believe that the fastest way to get foreclosed property details is to go directly to the banks/sellers, and now everyone can do so because their contact details are there, for everyone to see! Again, no more bottlenecks (refer to #9).

15. Brokering is best done with a team, and I’m talking about a real team with several people. A one-man team simply can’t cut it, it will lead to stress and burn-out.

Actually, there are so much more reasons, but I’ll just add them here when I have time.

Update: More reasons…

16. Our baby project was a success! I truly believe avoiding stress by quitting brokerage (both me and my wife) was a big factor. Thanks be to God!

17. People don’t realize how hard it is to be a real estate broker. We solve problems, we find solutions, we actually make deals happen, and we go for win-win. And yet, majority of the time, it’s a thankless job… it can get so frustrating.

But I guess I’m lucky because I was blessed with a lot of clients and friends (both buyers and sellers) who know the value of real estate brokers (Thank you guys… you know who you are!), which is probably why I stayed as a broker for a long time.

In parting…

I just want to remind everyone that I started this blog to share what we learned in our real estate investing journey, along with the listings that we found. And then we tried to broker foreclosed properties. It was very rewarding, we learned a lot from it, and it was good while it lasted, but things change.

Make no mistake, becoming a licensed real estate broker is still a good stepping stone to investing in real estate. But when it’s time to move-on, you just have to move-on.

Nope, I’m not entirely shutting my doors to real estate brokerage, it’s just that I have to approach it in a different way, and all of the above should give you an idea of the things I want to solve when the time comes.

Don’t worry, there are a lot of honest and trustworthy real estate brokers out there. I would recommend going to the various real estate associations like REBAP, PAREB, etc. You can also go to our friends like Eden and Bryan Dayrit, DJ and his team from Driven Marketing group, our mentors from REBAP LMP and REBAP Marikina, to name a few.

Anyway, for now, I have come full circle, and I’m back to doing what I love doing, which is building a blog/platform that empowers real estate investors in the Philippines.

8 thoughts on “Top 15 Reasons Why I Stopped Brokering Foreclosed Properties”

  1. chris sarmiento

    Hi Sir Jay, im an OFW and would like to attend your training.
    i would like to time my vacation for the training. do you always start the training at August?

    1. Hi Chris, thanks for the interest in the training. We have a batch in August, and another, either in November or January.

  2. You made the best decision in your life when you chose “Being Healthy” as your top priority! Even if you are the richest man on earth you can not enjoy it if you are sick. Secondly,if you have the capital,it is best to become the real estate investor & sell the property yourself because you earn the full benefit of your investment or you may entertain brokers to sell the property faster but with lesser profit because you have to deduct the commission etc. Lastly,how about studying on how to invest in the stock market? This is even better because less stress,minimal paper works and if you are lucky the earnings far exceeds one’s imagination. Good luck,GOD BLESS U& your wife for being generous in sharing your time,knowledge& concern to all of us subscribers of your website.I salute you both!

    1. Thank you Nanay Marie! As Ralph Waldo Emerson said “The first wealth is health”. 🙂

      Exactly po, better to be the owner, not just the broker. Hehe!

      As for stocks, my wife is the one who is doing that. I’ll just stick to real estate. Thank you and God bless you too!

  3. Doris Espinosa

    The first I came across your blog/site, i was amazed there is someone who shares his knowledge in the industry freely, with integrity and a good heart. Praise God for rare real estate practitioners like you.

  4. Hi Jay, thank you for brokering our acquired properties in the past.. it was also a question at the back of my mind why did you quit on brokering.. Now its answered.. Though i might agree that dealing with banks directly will be the fastest way for someone to acquire foreclosed property, i would insist that having an attentive and honest broker is always beneficial.. For first time buyers, an honest broker like Jay is an indespensable ally to know the ins and outs of the whole process as well as in avoiding the pitfalls of an undesirable property, not to mention it has no additional cost to the buyer.. For repeat buyers who already know the whole process, having a broker is still advantageous, as he can do property inspections for free and have somebody to bounce back ideas and for finding some hard to locate properties that are mostly cheap and often overlooked. Just my two cents.. and respect your decision all the way. Family and Health is more important than anything else. Best regards, Millionare Mar 🙂

    1. Wow, thanks a lot Mar for the kind words! Friends like you made me stay on as long as possible as a broker. Let me know pag napasyal ka samin, coffee tayo!

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