REALTORS, you will inevitably come across a homeowner while prospecting who says; I am not interested as we are trying to do a loan modification. The homeowner attempting to do a loan modification is going to run into some problems especially if they are already in pre-foreclosure meaning that there has been an NOD (Notice of Default) filed against the homeowner with a projected sale date.
It has been my experience there are three reasons a homeowner is motivated to do a loan modification:
1. Reduction in wages
2. Owe more than the home is worth and selling is not an option.
3. They want to SAVE their house.
Most homeowners will start by calling their lender. Here are some complaints I have heard out in the battlefield from homeowners who are frustrated with the process:
1. I submitted my paperwork weeks ago and when I finally got a hold of a representative I was told they have no record of our modification on file.
2. I cannot get anyone to call me back.
3. I am not successful on my own so I was thinking of hiring an attorney or someone from a loan modification company who will work with the lender on my behalf.
Keep in mind that these are people that are stressed out and do not know who to trust and they need a professional to explain to them what is about to unfold.
First off, truth be told, most homeowners approved for a loan modification in this market ARE NOT truly qualified for a loan modification and are a foreclosure waiting to happen. More than half of loan modifications are re-defaulting. I can appreciate them wanting to save their home as no-one wants to uproot their families but the reality is we are also in an economy where employment has been challenged. If they are experiencing a wage reduction the questions to ask are the following:
1. Do you see your financial picture improving or staying the same over the next year?
2. Is this a temporary fix?
3. When taxes and insurance adjust and your payments increase yet again, are you going to be able to continue to make your mortgage payments for the life of the loan?
4. If the lender does approve your loan modification is it going to be lowered enough to make sense for you to accept the terms?
5. Are you aware that most loan modifications will only lower your payment by roughly $200?
6. Are you aware there is a sale date on your property and that not hearing from you lender is not a good sign?
7. Are you going to be able to avoid your home from going to foreclosure?
8. Did the person working on your case charge you an upfront fee?
Depending on the answers that you receive from your potential client to these questions will assist you in encouraging them to look at all their options as their answers to these questions could show HUGE red flags that they are in trouble.
Most homeowners owe more than their home is worth. They actually do want to sell but that is not possible traditionally. Most home owners do not realize all of their options. Their first thought is to try a loan modification. That is fine to try, but that does not really solve their problem and they need to have a plan B. Though a short sale is a long process, foreclosing would be much more damaging to their credit.
The number one motivator for families is to SAVE THEIR HOUSE. Most homeowners are devastated and are clinging to some sort of hope that the lender will have their best interest in mind. REALTORS, we all know that could not be farther from the truth. As a short sale negotiator I have the opportunity to hear both sides. I know what is most important to the homeowner and the lender. Neither parties are wrong, but at the end of the day it comes down to numbers. Everyone is going to lose something so the idea is to make sure we are meeting in the middle.
As Real Estate professionals you have the opportunity to help them stop the bleeding and find a solution that will best fit their needs and help them get back on solid ground.
(Quote) When one door closes another door opens;
but we so often look so long and so regretfully upon the closed door,
that we do not see the ones which open for us.
-Alexander Graham Bell
REALTORS, what is in your business plan this year? What are you doing to create a system that will allow you to build your short sale business? How often are you out there prospecting and how do you know if you are taking the listings that are going to be successful and not a waste of your time?
Call us today and let us show you a system that works to help you expand your business and effectively and efficiently close short sale transactions.
LOTUS REALTY GROUP
PROFESSIONAL SHORT SALE NEGOTIATORS
At Lotus Realty GROUP, helping people ethically succeed is at the forefront of who we are...
Call today to find out how Lotus Realty Group can assist you in closing your short sale transactions or go to WWW.LotusRealtyGroup.com
Thursday, May 19, 2011
Monday, May 9, 2011
Set up your revenues for the future by giving back in a depressed market!!
I work with a lot of REALTORS who are targeting homeowners who are defaulting on their mortgage. One of the main questions that is asked is how do you approach a home owner who is in default and going through one of the most stressful and difficult times of their life?
Let me share with you my experience. Two years ago I was an active and aggressive door knocker. DAILY I would pick ten homes in Foreclosure Radar all within a 5 mile radius and with a sale date of at least 2 months out and I would visit these houses in the afternoon when most people are getting off work. I quickly learned a few things and had to adjust my approach accordingly:
1. These are not expired listings or FSBO'S, meaning this is not a traditional market and my ways had to soften in order for someone to want to hear what I had to say. The traditional “Sign the contract” was not going to work.
2. These homeowners were inundated with mailers from REALTORS claiming they were short sale experts but the majority of them were charging an upfront fee which led to distrust within the Real Estate market.
3. Some of the homeowners were trying to do a loan modification and were in complete denial about the reality of their situation. They were unaware that most loan modifications fail and foreclosure was therefore imminent.
4. Most homeowners were not educated about all of their options and were not aware of the California foreclosure timeline.
I realized that in order for me to be successful in getting the homeowners to speak to me I needed to consider the following:
1. I needed to remain open, compassionate, non judgmental and KNOW that my job is to build a relationship and trust. Listen first and then ask questions.
2. I did not want to sound like I was reading a script. Although that works well when you are calling expired listings and FSBO'S, in a delicate matter such as this where a lot of negative emotions are flying around coming from the heart is where I knew I would be most effective.
3. I needed to know my content in order to handle objections as there are many in short sale transactions. There is a level of distrust so the more professional, compassionate and knowledgeable I was, the more I would be able to get through to them.
4. I needed to EDUCATE the homeowner on all of their options. Help them to decide on their own what the best choice would be in order for them to achieve their goals.
What I sense from home owners who are losing their homes is a level of fear, shame and guilt. That’s a lot of energy to hold space for. The question to ask yourself is can you be still and listen, really listen? That’s what they are looking for along with a solution. Here are “3 ways of giving” I like to use when I am on a listing appointment:
a) Give them reality
b) Give them their options
c) Give them hope
They are looking for you to tell them the truth not what they want to hear. By listening and asking all the right questions you will be able to intelligently explain what is about to unfold.
Go over the pros and cons of all options for a homeowner in default and then put the ball in their court so they can feel a sense of empowerment that they made this decision and it was not forced upon them.
Lastly, offer to help. Help them find a rental at the end of the short sale or offer help with a credit recovery program. If all is done properly, in 18-24 months they could be in the market to buy a home again.
What does this do for you as agents?
These homeowners are not broken; they just need the proper guidance. If you allow yourself to give back to the community and to people that truly need help you are creating 3 things:
1. Build strong relationships.
2. When you help them through this process and break through to the other side they will come back to you therefore setting up your revenues for the future.
3. You will be the first person they think of when they are in a position to refer you to others who could benefit from your services.
It is no secret that we are in a time where our entire livelihood has been challenged but one of the greatest gifts I have learned in this market is the more I slow down and take the time needed to connect with people and listen the more effective and efficient I am. I have great connections with wonderful people and the feeling I get when I am able to help someone through this time and make it a win for them is something that money can’t buy yet I am rewarded anyway. How does that happen?
(Quote) The place to improve the world is first in one's own heart and head and hands.
Robert M. Pirsig
REALTORS, what is in your business plan this year? What are you doing to create a system that will allow you to build your short sale business? How often are you out there prospecting and how do you know if you are taking the listings that are going to be successful and not a waste of your time?
Call us today and let us show you a system that works to help you expand your business and effectively and efficiently close short sale transactions.
LOTUS REALTY GROUP
PROFESSIONAL SHORT SALE NEGOTIATORS
At Lotus Realty GROUP, helping people ethically succeed is at the forefront of who we are...
Call today to find out how Lotus Realty Group can assist you in closing your short sale transactions or go to WWW.LotusRealtyGroup.com
Let me share with you my experience. Two years ago I was an active and aggressive door knocker. DAILY I would pick ten homes in Foreclosure Radar all within a 5 mile radius and with a sale date of at least 2 months out and I would visit these houses in the afternoon when most people are getting off work. I quickly learned a few things and had to adjust my approach accordingly:
1. These are not expired listings or FSBO'S, meaning this is not a traditional market and my ways had to soften in order for someone to want to hear what I had to say. The traditional “Sign the contract” was not going to work.
2. These homeowners were inundated with mailers from REALTORS claiming they were short sale experts but the majority of them were charging an upfront fee which led to distrust within the Real Estate market.
3. Some of the homeowners were trying to do a loan modification and were in complete denial about the reality of their situation. They were unaware that most loan modifications fail and foreclosure was therefore imminent.
4. Most homeowners were not educated about all of their options and were not aware of the California foreclosure timeline.
I realized that in order for me to be successful in getting the homeowners to speak to me I needed to consider the following:
1. I needed to remain open, compassionate, non judgmental and KNOW that my job is to build a relationship and trust. Listen first and then ask questions.
2. I did not want to sound like I was reading a script. Although that works well when you are calling expired listings and FSBO'S, in a delicate matter such as this where a lot of negative emotions are flying around coming from the heart is where I knew I would be most effective.
3. I needed to know my content in order to handle objections as there are many in short sale transactions. There is a level of distrust so the more professional, compassionate and knowledgeable I was, the more I would be able to get through to them.
4. I needed to EDUCATE the homeowner on all of their options. Help them to decide on their own what the best choice would be in order for them to achieve their goals.
What I sense from home owners who are losing their homes is a level of fear, shame and guilt. That’s a lot of energy to hold space for. The question to ask yourself is can you be still and listen, really listen? That’s what they are looking for along with a solution. Here are “3 ways of giving” I like to use when I am on a listing appointment:
a) Give them reality
b) Give them their options
c) Give them hope
They are looking for you to tell them the truth not what they want to hear. By listening and asking all the right questions you will be able to intelligently explain what is about to unfold.
Go over the pros and cons of all options for a homeowner in default and then put the ball in their court so they can feel a sense of empowerment that they made this decision and it was not forced upon them.
Lastly, offer to help. Help them find a rental at the end of the short sale or offer help with a credit recovery program. If all is done properly, in 18-24 months they could be in the market to buy a home again.
What does this do for you as agents?
These homeowners are not broken; they just need the proper guidance. If you allow yourself to give back to the community and to people that truly need help you are creating 3 things:
1. Build strong relationships.
2. When you help them through this process and break through to the other side they will come back to you therefore setting up your revenues for the future.
3. You will be the first person they think of when they are in a position to refer you to others who could benefit from your services.
It is no secret that we are in a time where our entire livelihood has been challenged but one of the greatest gifts I have learned in this market is the more I slow down and take the time needed to connect with people and listen the more effective and efficient I am. I have great connections with wonderful people and the feeling I get when I am able to help someone through this time and make it a win for them is something that money can’t buy yet I am rewarded anyway. How does that happen?
(Quote) The place to improve the world is first in one's own heart and head and hands.
Robert M. Pirsig
REALTORS, what is in your business plan this year? What are you doing to create a system that will allow you to build your short sale business? How often are you out there prospecting and how do you know if you are taking the listings that are going to be successful and not a waste of your time?
Call us today and let us show you a system that works to help you expand your business and effectively and efficiently close short sale transactions.
LOTUS REALTY GROUP
PROFESSIONAL SHORT SALE NEGOTIATORS
At Lotus Realty GROUP, helping people ethically succeed is at the forefront of who we are...
Call today to find out how Lotus Realty Group can assist you in closing your short sale transactions or go to WWW.LotusRealtyGroup.com
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