Questions to ask a homeowner attempting a loan modification

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