| Author |
Previous Topic | Next Topic |
WizardLending
161 Posts |
 Posted - 08/24/2007 : 12:26:17 PM
|
I obviously had my last post deleted, since I was offering a service and posted it under this "mortgage brokers" forum. I was just trying to get the word out to anyone that will listen, that there are alternatives available and we could help you close those unfundable deals.
I realize that this forum states that it is for loan requests and to discuss mortgage and realestate related topics. But, I also see post for sports, people quoting songs and jokes. I don't see any seriousness in any of these extras, but they haven't been deleted.?. So I am turning this post into a question for any of you that get people that are in need of a foreclosure. So here it is:
When you get a client that has an NOD or a FORECLOSURE and they have below 500 credit and their LTV is over 80%, what do you do with thier file?
I know from my own personal past experience that probably 75% of you throw it to the side and never call the client back. (Now this is my own personal experience. I am sure there are some of you that do help, so I don't want anybody saying that I am putting them down by saying this.) Most of the people going through foreclosure, didn't get their by choice and bad things do happen to good people. A lot of times it is from medical problems, death in family, accidents, etc. Things that come out of nowhere and create a huge financial burden on a family. I really believe these people deserve a chance to save their home and hope most of you feel the same.
I realize that there are a lot easier deals to be done and better things come along, but these people come to you for a reason. They need your help and trust you to get it done.
http://www.wizardlending.com/pro_lossmitigationspecialists.htm |
|
|
|
Dana Point
2820 Posts |
Posted - 08/24/2007 : 1:49:33 PM
|
| Do i have to pay you to sign up for your services? i can sell you tons of my leads i have i just tell them seek a BK attourney. last time i checked out any loss mitigation deal they wanted me to cut them a check. |
|
|
forsociald
2140 Posts |
Posted - 08/24/2007 : 1:52:15 PM
|
| Looks like another ad to me |
|
|
WizardLending
161 Posts |
Posted - 08/24/2007 : 2:12:04 PM
|
Thanks John for your encouraging words. I truly want to know what you do with your foreclosure bailouts, that you can't fund. Are you the guy that they come to and when you can't fund the deal, you avoid all calls from them and/or never call them back, then quietly put the file under the rest of the stack on your desk? Or are you someone that helps these people?
I want to know, because I would like to put together a think tank of lenders, brokers and LO's, that really want to help these people. I get calls from all over the United States. The main problem I am seeing, is that by the time they come to us, there isn't enough time left to help them. Mainly because lenders, brokers and LO's have sat on their file for weeks, stringing them along and passing on false hopes to the client and not addressing the problem head on and fixing it. Yes, we can all make a little money on it, but most importantly we can help these people save their home. Bankruptcy isn't always the answer.
I am looking for lenders that are sitting on these files and lenders that can help the situation. I am looking for Brokers and LO's that are sitting on these files and have nowhere else to turn. Instead of throwing the file away, let's get together as a group and help them in a timely manner. Not wait until the last minute and then hand them off, when you know it is too late.
Are you in or out? |
|
|
WizardLending
161 Posts |
Posted - 08/24/2007 : 2:27:59 PM
|
quote:
Originally posted by Dana Point
Do i have to pay you to sign up for your services? i can sell you tons of my leads i have i just tell them seek a BK attourney. last time i checked out any loss mitigation deal they wanted me to cut them a check.
Dana Point:
You do not pay anything for our services. I do charge the borrower a small fee. The way I look at it, if they can't pay our small fee (which would be a fraction of their mortgage payment) and they want bailed out of a foreclosure on their $500,000 home, then something is drastically wrong with their situation. You can check out our website for full details on our fees, etc...
http://www.wizardlending.com/pro_lossmitigationspecialists.htm
Send them to me and I will work my "magic". I will negotiate a short-payoff (short-refi) and then give them back to you with the LTV you need to close the deal. That's it. Short, sweet and simple. |
|
|
Dana Point
2820 Posts |
Posted - 08/24/2007 : 2:40:45 PM
|
| if i dont have to pay **** to send clients there |
|
|
WizardLending
161 Posts |
Posted - 08/24/2007 : 2:49:51 PM
|
quote:
Originally posted by Dana Point
if i dont have to pay **** to send clients there
What does that mean? I know what the **** stands for, but what do you mean by this comment?
|
|
|
Bobbi
306 Posts |
Posted - 08/24/2007 : 7:46:57 PM
|
| Most people that are having trouble with their house payments are not likely to put out a fee of that amount and take a chance that it won't go through and then they are short on their payments, and the hill gets steeper as they roll down it... |
|
|
WizardLending
161 Posts |
Posted - 08/24/2007 : 8:17:18 PM
|
quote:
Originally posted by Bobbi
Most people that are having trouble with their house payments are not likely to put out a fee of that amount and take a chance that it won't go through and then they are short on their payments, and the hill gets steeper as they roll down it...
How do you consider my $375 upfront fee and a remaining fee of $300 (remaining only paid if negotiation is completed to the satisfaction of the lender) is too much to pay. I am charging a total of $675.00 to save their home. It's the brokers and LO's taking 4 pts on the loan and the hard money lenders wanting 5-8 pts that put them in the hole. I am just here to do them a service to enable them to keep their home. And just so you know, if I broker the deal myself I normally charge only 2 pts, not 4 like most. It's bad enough with the situation these people are in, but most like to kick these people while they are down and charge max points, just because you can. Maybe you are saying I should do my service for free, so you can charge max points and that would make you feel better about sending them to me.
Plus let's put it this way..... If they already have a $2000.00 monthly payment and they haven't paid it for (usually) 4 months, where has that money gone? If they can't afford my small fee, how the he11 are they going to aford their new payment at 12.5% interest, compared to the 7-8% ARM that they were just in? This game is only for people that can play and really want to save their home. It's a temporary fix for a year or two, until they can get their credit and finances back in order. I apologize if I sound harsh, but I see this crap everyday and nobody wants to help these people unless there is enough in it for themselves. I want to help them and not see them out on the street. |
|
|
Loans4All
1082 Posts |
Posted - 08/24/2007 : 8:32:08 PM
|
| How are saving their home? Is the bailout lending based or is it a quick claim deed to lease option deal? |
|
|
WizardLending
161 Posts |
Posted - 08/24/2007 : 11:08:44 PM
|
quote:
Originally posted by Loans4All
How are saving their home? Is the bailout lending based or is it a quick claim deed to lease option deal?
Personally I think the lease/buyback option is just that, another option and in my opinion, a last resort option. There are only a handful of these quick claim deed, lease/buyback companies that I would maybe trust. This idea is actually lending based.
From what I am seeing, there is only a handful of lenders that will do a foreclosure bailout, if it is done in time and before the customer's FICO's drop below 500. Once they have an NOD and their score falls below 500, their only option is hard money or bankruptcy (or sell).
The people I am dealing with fall into the catagory of NOD or sheriff sale set and below 500 FICO's. Their only choice to refi the house is through a hard money lender. Problem with this is that hard money is equity based and most properties do not fall into their criteria (60%-70%LTV). This is where a negotiator, like myself, can help these people keep their home, by working out a short-payoff with their current lender, to bring the LTV down where it needs to be, so brokers, lenders and LO's can get these deals funded.
I am just wanting to work together with everyone that sees these deals as dead files and possibly save some of them. I realize that not all can be saved, but what a rewarding feeling to know that when you do make a deal work, you helped someone save their home.
I was also put down, for charging a fee to the customer for my negotiating, because the borrower can't afford it. But on the other hand, a lot of lenders, brokers and LO's answers to these people is to bankrupt. Now think about this..... My idea works on the principle of the people keeping their home. In my experience, approximately 8 out of 10 lenders are open to negotiation, which is pretty good odds. And, if all goes well, the business is kept within the mortgage community. Now, if you are sending these people to a bankruptcy lawyer, the only people making money are the lawyers and most of the time, the people end up loosing their home in the bankruptcy anyway. Plus, if they can't afford $375 out of their pocket to possibly save their home and not have a bankruptcy or foreclosure blemishing their credit report for ten years, how can they afford a Chapter 13 bankruptcy, which is costing them around $2000.00? A chapter 13 isn't cheap and it doen't guarantee that they will keep their home. If the payment plan set up by the attorney doesn't fly with the trustee or the lender on a chapter 13, the bankruptcy is dead in the water. And in a chapter 7, they will still loose their home. When it comes down to it, they don't have many choices that won't cost them something. Plus, if they let it go to sheriff sale, they will have a foreclosure on their credit for 10 years. If they bankrupt they will have a bankruptcy on their credit for 10 years and either way, they will or might loose their home. At least with my plan, they have a damn good chance of keeping it and it won't end up haunting them on their credit file for 10 years. To most, it's a risk worth taking.
Now the whole lease/buyback option is a completely different ball game. But, in most cases I would rather put a client in a lease/buyback option, than tell them to bankrupt, as a last resort. The only people I tell to bankrupt, are the ones that come to me 2-4 days before a sheriff sale (usually with a weekend in there, so those 2 days are out) and want help. What were they doing for the past month or two, which would have given us plenty of time to help them and exhaust all options, before getting to this stage? About 90% of them tell me that they were dealing with a le |
|
|
munson
231 Posts |
Posted - 08/25/2007 : 12:26:46 AM
|
| on avg, what kind of time frame are we talking about from the time you collect the $375 (which is when I assume you start working w the lender) till the time the short payoff is negotiated and approved. 1wk?, 2wks?, a month???. By the way in Fl if your house is homesteaded you can't lose it in a BK. However this sounds interesting because the BK laws have gotten tougher down here and there not rubber stamped like they use to be. Do you work in FL ??? |
|
|
WizardLending
161 Posts |
Posted - 08/25/2007 : 01:21:30 AM
|
quote:
Originally posted by munson
on avg, what kind of time frame are we talking about from the time you collect the $375 (which is when I assume you start working w the lender) till the time the short payoff is negotiated and approved. 1wk?, 2wks?, a month???. By the way in Fl if your house is homesteaded you can't lose it in a BK. However this sounds interesting because the BK laws have gotten tougher down here and there not rubber stamped like they use to be. Do you work in FL ???
John,
I appreciate your interest. First off, I will negotiate for anybody facing foreclosure, in all 50 states. So, yes I do Florida. In fact I just helped a gentleman from Lakeland, FL. I unfortunately wasn't able to negotiate a short-refi for him, but instead helped him set up a re-payment plan with his current lender. His current lender was Option One and out of all of the lenders I have dealt with, they were the first not to accept a short-payoff. What was strange was that they would definitely have done a short-sale, but not a short-refi. To a lender, you wouldn't think there would be any difference. Either way, they would be getting less for the property, but wouldn't have to go through the hassle or the cost and time of a full foreclosure. But Option One would not budge. The difference to the homeowner, obviously is a short-refi, they get to stay in the home or short-sale, they have to leave. But, both ways would avoid a full foreclosure on the property and their credit. I guess Option One figured they were one up on the homeowner by not allowing them to keep the property, if they had to accept less, for some reason.
To answer your other question, it usually takes 2-3 weeks to negotiate a short-payoff. It can take a little longer, but mostly depends on the lender and how quick they are to respond. Longest I had one take was 5 weeks, but that was because the lender insisted on a BPO of the property, which took them three weeks to complete (order it, get it done, analyze it in two differnt departments, then get back to me once they were happy with it). If we have less than two weeks, before a scheduled sheriff sale, we will concentrate our efforts on postponing the sale first, so we have enough time to complete the negotiations and get the deal funded.
You can call me over the weekend or Monday and we can discuss things further if you like. You can also see more about our service and download our contract through our website at: http://www.wizardlending.com/pro_lossmitigationspecialists.htm
Thanks,
Loren Gingerich |
|
|
munson
231 Posts |
Posted - 08/25/2007 : 10:46:40 PM
|
| Lakeland, home of the doublewides, snowbirds, hardcore FL rednecks, meth labs and misfits from up north. I lived there for 3mos..... worst 3 mos of my life. I swear I went into a bar on the West side of town once and there was a cardboard sign on the wall when you walked in that said "3 tooth minimium"(sic) written in magic marker. One of the true armpits of Fl. |
|
|
WizardLending
161 Posts |
Posted - 08/25/2007 : 11:36:47 PM
|
quote:
Originally posted by munson
Lakeland, home of the doublewides, snowbirds, hardcore FL rednecks, meth labs and misfits from up north. I lived there for 3mos..... worst 3 mos of my life. I swear I went into a bar on the West side of town once and there was a cardboard sign on the wall when you walked in that said "3 tooth minimium"(sic) written in magic marker. On of the true armpits of Fl.
Wow, I've never been there, but it sure doesn't sound like the same place judging from this guys appraisal. I wish I could post a picture of it. It was an $840K home, in a gated community, 3000+ sq. feet of living space with an enclosed in-ground pool and spa, in the back. Pictures of the home are awesome. I've never been to Florida, but from what I'm seeing and what your saying it sounds like two different worlds. The home I was dealing with, sure didn't look like something you really wanted to give up.
|
|
|
munson
231 Posts |
Posted - 08/25/2007 : 11:51:26 PM
|
| Obviuosly I embellished a bit. Other than East St Louis Mo, I think every city w a pop > 50,000 has a good side of town and that sounds feasible. I know there are some good neighborhoods on the South Side over by the Exec airport, however that's not the norm for Lakeland. That kinda money could get you something on the Gulf of Mexico or certain parts of the Atlantic. Why would you want to live around a bunch of phosporous & limestone plants and have the major East/West artery running thru your town be I4. 1 out of 10 vehicles going down Memorial Hwy is a semi and Memorial runs thru many neighborhoods. But if your ever driving thru Fl and are getting white line fever stop at one of their many Patel Hotels. You can cut a deal because they rent rooms by the hr |
|
|
WizardLending
161 Posts |
Posted - 08/25/2007 : 11:56:12 PM
|
| I uploaded a pic of it and hosted it on my site, but the link won't work. Really wanted you to see a pic of the place.. Oh well. I pretty persistant on getting things to work, but kind of tired tonight...lol. Something that would take me 10 minutes would probably end up taking 2 hours.. Not worth it.. At least you know what I mean.. And I wasn't trying to save a trailer,down there, even though I have elsewhere...lol. |
|
|
Mandyvilla
6392 Posts |
Posted - 08/26/2007 : 07:38:08 AM
|
Here is my problem with this - and I do run across this more frequently and rarely can help.
It's no secret, I am an A paper lender. So, even if you were able to negotiate a short refi, or anything for that matter, chances are I could not help them with the end loan.
Another question I would have, if the homeowner has already discussed a short refi with their current lender is there any benefit to them contacting you? And finally, have you tried (and if so, been successful) to negotiate the amount the bank will show to the IRS as written off debt? |
|
|
WizardLending
161 Posts |
Posted - 08/26/2007 : 12:43:42 PM
|
quote:
Originally posted by Mandyvilla
Here is my problem with this - and I do run across this more frequently and rarely can help.
It's no secret, I am an A paper lender. So, even if you were able to negotiate a short refi, or anything for that matter, chances are I could not help them with the end loan.
I can get the loans done and can make sure you are compensated in some way... Call me to discuss this further. So what I am saying, is that if you send them to us, we can help them in everyway and it wouldn't be a waste of your time.
Another question I would have, if the homeowner has already discussed a short refi with their current lender is there any benefit to them contacting you? And finally, have you tried (and if so, been successful) to negotiate the amount the bank will show to the IRS as written off debt?
My answer for this question would be the same as above. We have lenders that will go 70%-75% LTV and in some cases 80%LTV. As far as negotiating the written off debt, I have had some success with getting a few of the lenders to show the written off amount up to the principle amount that was due at the time. And not include all of the interest, legal fees and late fees that have been building up. What I mean by this is let's say I had a house I negotiated a short-payoff for $100K. The principle owed at the time,was $120K, but by the time they came to us and since the foreclosure had started, they built up interest, late fees, legal fees, etc.., making their complete payoff $140K. Looking at the complete picture, this lender would be writing off $40K, but a few will show it at the principle amount of writing off only $20K. Plus, we do have ways of reducing the amount that is shown as written off, that gives us some leverage in the negotiation process, but I can't reveal all of our secrets... Hope this helps.
|
|
|
todoforu
775 Posts |
Posted - 08/26/2007 : 2:02:14 PM
|
I have a situation where the Foreclosure Sale was already executed, but there were no buyers. At least I don't think so...
Can you assist in this type of scenario? |
|
|
WizardLending
161 Posts |
Posted - 08/26/2007 : 2:57:31 PM
|
| I just popped in to check my e-mail and saw your two new posts. I don't have time at the moment to answer your questions in detail, but wanted you to know that I am aware of them. I will be back in a few hours and will answer both of your questions in full detail, when I return. Thank you both for your interest. See you in a few. |
|
|
MaJa
143 Posts |
Posted - 08/26/2007 : 3:40:45 PM
|
| I'm interesting in finding out more about this as well. When do you step in? Is it after the first NOD, or can you help a client prior to them going into default? They're hanging on by a thread right now. |
|
|
WizardLending
161 Posts |
Posted - 08/27/2007 : 03:37:21 AM
|
quote:
Originally posted by todoforu
I have a situation where the Foreclosure Sale was already executed, but there were no buyers. At least I don't think so...
Can you assist in this type of scenario?
Fifi,
I see you are in CA. In California, it depends on whether the forclosure was judicial or a non-judicial. A judicial foreclosure is pretty rare, but that is the only type that allows for redemption of the property. With a judicial foreclosure, the redemption period can be up to one year from the sale date. Most of the time in CA, you will see a non-judicial foreclosure, which is basically is a clause in the original loan documents, giving the lender the right to forelcose on the property in the event of a default in payment. I have never worked on a situation, after the sale has taken place. But, if there were no bidders, the lender becomes the owner and will usually evict the homeowner within the first 30 days. They will then send a realtor out to do a BPO, to give them an idea what the property is worth. They won't do this, until the owner is out of the home (usually). They will then send in a crew to clean up the home and then list the property with a local realtor. In my opinion, if you have someone interested in the property and you can contact the foreclosing lender, before they clean it up and put it on the market, you would probably be able to pick it up for a short-sale price, depending on what kind of condition the home is in. So to sum it up, in CA, with a judicial foreclosure, the homeowner has a right to redemption. With a non-judicial foreclosure, the homeowner has no right to redemption. |
|
|
mjrosov
3332 Posts |
Posted - 08/27/2007 : 03:42:27 AM
|
| I'm curious what the tax implications are on a short sale? |
|
|
WizardLending
161 Posts |
Posted - 08/27/2007 : 03:45:53 AM
|
quote:
Originally posted by MaJa
I'm interesting in finding out more about this as well. When do you step in? Is it after the first NOD, or can you help a client prior to them going into default? They're hanging on by a thread right now.
Sally,
I usually can work with a lender and get them to negotiate, when the homeowner is at least 60 days behind on their mortgage. The earlier they start working on it, the better. The lenders are more willing to negotiate after the first NOD, but if you know it is going that direction, then it's all the same. Once the NOD hits, then the clock starts ticking. I would be glad to speak with you about your clients situation. Give me a call today. |
|
|
roborg
106 Posts |
Posted - 08/27/2007 : 04:00:13 AM
|
Wizard Lending - are you performing these services yourself or are you contacting it out? Reason I ask is because I have come across a few organizations that will do the work and have tried one but was very displeased with their efforts.
For anyone interested in helping people stop their foreclosures, here's something you should know. I know of this woman that performs loan auditing. She examines every single document involved from respa to the closing documents. In a high percentage of cases, she finds mistakes or improprieties that allow borrowers to actually rescind their mortgage! The rescision period for these types of mistakes is actually 3 years! I have never heard of this before but she is actually helping someone I referred to her and it looks good so far.
I'll let you know how it goes. I cannot give out her name or info - she already has too much business right now and has not trained others to perform her work. But just to know that something like this is available with the current sorry state of affairs in this country is helpful. |
|
|
WizardLending
161 Posts |
Posted - 08/27/2007 : 04:28:05 AM
|
quote:
Originally posted by Michigan
Wizard,
To help me with your Credibility, could you describe in detail the Actions that a Homeowner can take before I recommend he call you? I have many people I toss to the side, if I had someone I could Trust I would send business their way, even if I wasn't compensated.
I'm assuming you know more than me, so I will await your answers.
Thanks
Mike,
I would have to say that first and foremost, when a homeowner starts getting behind on payments, they really need to communicate with their current lender. Communication is the key to the help they can receive from their current lender, before things get to the point of no return. This has to be the biggest mistake most homeowners make. When they get behind on that first payment, they don't answer the phone when the lender calls, they avoid them at all cost, because most of them are afraid to just tell them the truth, for fear of the answer they may receive. But the truth, is that most lenders will do anything for a homeowner, to avoid a foreclosure. Mortgage companies are not like credit card companies, when you fall behind on payment and I beleive that most people have a real fear of dealing with companies like that. Credit card companies and their collection agencies use such scare tactics that most people think that mortgage companies will treat them the same way. And in most cases that is not true. And in my opinion, most people that are behind on their mortgage are also behind on their credit cards, so they are getting calls from both, all day long. Foreclosure proceedings vary from state to state and I am not going to break things down for evey state, so what I am going to tell you here, is a general concept for the most common things these people face when receiving an NOD and what their most common options are. I would have to say that the most common thing a person that is behind on their mortgage payments can do is a forbearance agreement. It does take some time and does have a lot of paperwork to fill out, but in my opinion this can be done by the homeowner themselves. I see a lot of companies charging big money for this concept, which can be done by the homeowner for free. The forbearance agreement basically takes the amount of payments they are behind, along with late fees and breaks them down into an additional monthly payment (along with their normal mortgage payment). The amount behind, can be spread over 12 months and I have seen some lenders split the payments up to two years. But 12 months is more common. Some lender will try to tell you that they can only split it over 3-6 months and some people will agree to it, just because they don't think they have any other choice. In this case, the payment may be too large for them to keep up on and they fall behind again, putting them into the same situation a few months down the road. I guess this is where some people could use someone like me, to negotiate the terms of the forbearance agreement, so they can actually get the terms they can truly live with. But, if the homeowner is persistant and really knows what they are getting into, they will be alright. The lender will ask for basic documentation (w-2, pay-stubs, etc.)along with hardship letter and they will usually have them fill out a questionaire, asking them to explain their situation, when it started, if it is over, etc.. In my opinion, this would be the best thing a homeowner can do, to avoid foreclosure. But then you get some people that put it off until it's too late. Another thing a homeowner can do to avoid foreclosure is refinance, before they hit 60 or 90 day lates. There are a few lenders out there that will treat rolling 30's like one or will allow 1x60 or 90, with unlimited 3 |
|
|
WizardLending
161 Posts |
Posted - 08/27/2007 : 04:43:11 AM
|
quote:
Originally posted by roborg
Wizard Lending - are you performing these services yourself or are you contacting it out? Reason I ask is because I have come across a few organizations that will do the work and have tried one but was very displeased with their efforts.
For anyone interested in helping people stop their foreclosures, here's something you should know. I know of this woman that performs loan auditing. She examines every single document involved from respa to the closing documents. In a high percentage of cases, she finds mistakes or improprieties that allow borrowers to actually rescind their mortgage! The rescision period for these types of mistakes is actually 3 years! I have never heard of this before but she is actually helping someone I referred to her and it looks good so far.
I'll let you know how it goes. I cannot give out her name or info - she already has too much business right now and has not trained others to perform her work. But just to know that something like this is available with the current sorry state of affairs in this country is helpful.
Ron,
I do this all myself. My wife works with me, keeping things in order, but the negotiating is all done by me. It is time consuming and the way things are going, I will probably have to bring on a few people to work with me in the near future. But, I am very micromanagment..lol. It is one of my worst faults. The way I look at it, is that by the time I take the time to train someone and show them the ropes, I might as well have done it myself. But, if the industry stays in this mode for a while, I will have to hire a staff. It really stinks when I get a cold or flu, because it makes it hard to talk, when I am coughing every two minutes, which is what usually happens. Can't conduct business very well when my entire operation depends on speaking.
So to sum it up, I work these deals alone and I am very passionate about trying to help everyone that comes across my desk. Some of the cases I see, just can't be helped and it bothers me that I can't help them in some way. I try to point them in the right direction, if I can't be of service, but it still weighs heavy in my mind.
Keep me posted about the lady you are speaking about. Sounds like an interesting concept and would like to know more about it.
Thanks. |
|
|
WizardLending
161 Posts |
Posted - 08/27/2007 : 04:55:11 AM
|
quote:
Originally posted by Michigan
Wizard,
To help me with your Credibility, could you describe in detail the Actions that a Homeowner can take before I recommend he call you? I have many people I toss to the side, if I had someone I could Trust I would send business their way, even if I wasn't compensated.
I'm assuming you know more than me, so I will await your answers.
Thanks
Mike,
I forgot to mention in my last post to you, another important thing that homeowners can do to avoid foreclosure. If they have an FHA loan, they might be able to do a partial claim. This can only be done, if the loan is FHA and they are at least 4 months behind on payments, but no more than 12. They will have to work with the lender to do this, but they can get an interest free loan from HUD, that will pay the current lender the amount needed to catch up on their mortgage. HUD puts an additional lien on the home, but the loan does not need to be paid off, until first lien is paid off or the home is sold. Sorry I forgot to mention this the first time. |
|
|
Rampart
1284 Posts |
Posted - 08/27/2007 : 05:01:57 AM
|
quote:
Originally posted by munson
Obviuosly I embellished a bit. Other than East St Louis Mo, I think every city w a pop > 50,000 has a good side of town and that sounds feasible. I know there are some good neighborhoods on the South Side over by the Exec airport, however that's not the norm for Lakeland. That kinda money could get you something on the Gulf of Mexico or certain parts of the Atlantic. Why would you want to live around a bunch of phosporous & limestone plants and have the major East/West artery running thru your town be I4. 1 out of 10 vehicles going down Memorial Hwy is a semi and Memorial runs thru many neighborhoods. But if your ever driving thru Fl and are getting white line fever stop at one of their many Patel Hotels. You can cut a deal because they rent rooms by the hr
Embellished a bit is an understatement. BTW, did you get turned down by one of those FL rednecks once you got to the Patel motel? |
|
|
Rampart
1284 Posts |
Posted - 08/27/2007 : 05:25:32 AM
|
quote:
Originally posted by WizardLending
quote:
Originally posted by munson
on avg, what kind of time frame are we talking about from the time you collect the $375 (which is when I assume you start working w the lender) till the time the short payoff is negotiated and approved. 1wk?, 2wks?, a month???. By the way in Fl if your house is homesteaded you can't lose it in a BK. However this sounds interesting because the BK laws have gotten tougher down here and there not rubber stamped like they use to be. Do you work in FL ???
John,
I appreciate your interest. First off, I will negotiate for anybody facing foreclosure, in all 50 states. So, yes I do Florida. In fact I just helped a gentleman from Lakeland, FL. I unfortunately wasn't able to negotiate a short-refi for him, but instead helped him set up a re-payment plan with his current lender. His current lender was Option One and out of all of the lenders I have dealt with, they were the first not to accept a short-payoff. What was strange was that they would definitely have done a short-sale, but not a short-refi. To a lender, you wouldn't think there would be any difference. Either way, they would be getting less for the property, but wouldn't have to go through the hassle or the cost and time of a full foreclosure. But Option One would not budge. The difference to the homeowner, obviously is a short-refi, they get to stay in the home or short-sale, they have to leave. But, both ways would avoid a full foreclosure on the property and their credit. I guess Option One figured they were one up on the homeowner by not allowing them to keep the property, if they had to accept less, for some reason.
To answer your other question, it usually takes 2-3 weeks to negotiate a short-payoff. It can take a little longer, but mostly depends on the lender and how quick they are to respond. Longest I had one take was 5 weeks, but that was because the lender insisted on a BPO of the property, which took them three weeks to complete (order it, get it done, analyze it in two differnt departments, then get back to me once they were happy with it). If we have less than two weeks, before a scheduled sheriff sale, we will concentrate our efforts on postponing the sale first, so we have enough time to complete the negotiations and get the deal funded.
You can call me over the weekend or Monday and we can discuss things further if you like. You can also see more about our service and download our contract through our website at: http://www.wizardlending.com/pro_lossmitigationspecialists.htm
Thanks,
Loren Gingerich
Sounds just like my former employer's house- real nice right on the golf course at Eaglebrook. What a shame... |
|
|
Kager911
77 Posts |
Posted - 08/27/2007 : 2:33:34 PM
|
| Sounds like you offer a good service at a good price. I know only a little about short-sale/refi. Is it true that the amount shorted in the sale or refi shows up as 1099 income for the homeowner? I recently heard that this was the case and wondered if anyone here knew the answer. I was told the lender that was shorted actually issues the 1099 to the former home owner. |
|
|
WizardLending
161 Posts |
Posted - 08/27/2007 : 3:01:27 PM
|
quote:
Originally posted by Kager911
Sounds like you offer a good service at a good price. I know only a little about short-sale/refi. Is it true that the amount shorted in the sale or refi shows up as 1099 income for the homeowner? I recently heard that this was the case and wondered if anyone here knew the answer. I was told the lender that was shorted actually issues the 1099 to the former home owner.
Kevin,
That is correct. The lender will issue a 1099 the following year, for the difference, which will show up as an income for the homeowner. Some lenders will show the difference between the principle amount owed at the time of the short-payoff and what the accepted payoff was. Then others will show the diffence, including the late fees, legal fees and the interest that built up on the loan, but in my experiences, most lenders just show the difference between the principle and the short-payoff amount. This is kind of hard to explain, when typing it out, so here's an example: Let's say you have a home that the principle only owed on it was $120,000, but since the homeowner has gotten behind on payments, the interest, late fees and legal fees have built up making the entire amount owed to the lender (if paid in full) $140,000. This would be $20,000 in just interest, late fees, legal fees, etc. Now, let's say the lender accepts a short sale for $100,000. Some lenders will issue a 1099 in the amount of $20,000, while others will issue one for $40,000. Now, truthfully, the home owner just saved their home and $40,000. But yes, they will have to pay tax on the forgiven amount, which at $40,000 (this would be the worst case scenerio), could be as high as $12,000 or so, depending on the tax bracket they fall in to. The way I look at it, is that even though they have to pay the IRS, it is a far better deal than having to pay the entire $40,000 to catch up their loan or worse, loose their home completely. And, the IRS will allow payments at a very low interest rate, if they need to go that route. The homeowner just needs to be aware of this and be prepared to deal with it when it comes. After typing all of this, I wanted you to know that what I am talking about here is a short-refi, not a short-sale. Both cases, are the same, but obviously in a short-sale, they are giving up the house. And in both cases, they avoiding a foreclosure blemishing their credit for ten years. There is obviosly a price to pay either way, but a much smaller price than what could happen if the home goes to a complete foreclosure. If it goes to a full foreclosure on the property, in some cases their could be more money owed after a sale, than the tax paid on a short-sale or short-payoff (deficiency judgment), along with a foreclosure on their credit for ten years. In my opinion a short-payoff or short-sale is still a better way to go. |
|
|
Kager911
77 Posts |
Posted - 08/27/2007 : 3:11:07 PM
|
| Oh I agree, it'd be way better to keep the house and have to show a higher income for one year, than to lose the house. Thanks for the clarification! |
|
|
1stintegritymort
1782 Posts |
Posted - 08/27/2007 : 10:14:09 PM
|
| sounds like one of those things where it sounds too good to be true. i dont doubt that you are able to negotiate a short refi. but the states that are mainly affected by foreclosures are california, florida, michigan, and georgia. i dont have a source to back it but i think these states make up alteast half of all the foreclosures in the country. in states such as california and florida, where values are declining 20% a year or more how are you able to negotiate a payoff down to 65% ltv for a foreclosure bailout? most homes in florida are bought as investment properties and were puchased with high LTV's. we all know the situation in california... stated pay option arms up to 90% with a second behind it. michigan and georgia, well i dont think the housing appreciated much at all during the boom. realistically, how many of these states are you able to short refi? besides that, even if you can by some miracle talk them down 15% (80%ltv) to 25% (90ltv) why would any lender do a foreclosure bailout in a declining market? |
|
|
WizardLending
161 Posts |
Posted - 08/28/2007 : 01:17:42 AM
|
quote:
Originally posted by 1stintegritymortgage
sounds like one of those things where it sounds too good to be true. i dont doubt that you are able to negotiate a short refi. but the states that are mainly affected by foreclosures are california, florida, michigan, and georgia. i dont have a source to back it but i think these states make up alteast half of all the foreclosures in the country. in states such as california and florida, where values are declining 20% a year or more how are you able to negotiate a payoff down to 65% ltv for a foreclosure bailout? most homes in florida are bought as investment properties and were puchased with high LTV's. we all know the situation in california... stated pay option arms up to 90% with a second behind it. michigan and georgia, well i dont think the housing appreciated much at all during the boom. realistically, how many of these states are you able to short refi? besides that, even if you can by some miracle talk them down 15% (80%ltv) to 25% (90ltv) why would any lender do a foreclosure bailout in a declining market?
Steve,
The states that I get the most business from are California and Florida. I have received several calls from brokers in Michigan and Georgia, but nobody sending any business from those two states yet. If you don't include the clients that come to me with 48 hours before a sheriff sale or the clients that have Option One as their current lender (Option One will allow a short-sale, but not a short-refi), my success rate has been around 80%-85%. If you include the rest I am more like 70%-75%. Like I have said before, these lenders that are foreclosing on these people do not want to go through a foreclosure. It cost them a lot more money to foreclose, than taking a cut in payment on a short-payoff (whether it be a short-sale or a short-refi). Most of the time, especially in a declining market area, these houses are sold at auction and nobody shows up. which in turn, just creates another problem for them, by having an empty house sitting on their books, that they have to maintain and try to sell through a realtor. It's a lot easier for them to work a short-payoff and be done with the property. Last, you asked why would any lender do a foreclosure bailout in a declining market? I really don't have an answer for you. But, if you look at where probably 90% of the hard money lenders do business, it is California and Florida. |
|
|
ML
4970 Posts |
Posted - 08/28/2007 : 04:02:12 AM
|
| What states are you licensed to broker loans in? |
|
|
WizardLending
161 Posts |
Posted - 08/28/2007 : 04:15:51 AM
|
quote:
Originally posted by ML
What states are you licensed to broker loans in?
Here is a list of the states I am licensed in:
Alabama,Alaska,Arizona,Arkansas,California,Colorado,Connecticut,Delaware,District of Columbia,Florida,Georgia,Hawaii,Idaho,Illinois,Indiana,Iowa,Kansas,Kentucky,Maine,Maryland,Massachusetts,Montana,Michigan,Minnesota,Missouri,Nebraska,New Hampshire,New Mexico, North Carolina,North Dakota,Ohio,Oregon,Rhode Island,South Carolina,South Dakota, Tennessee,Utah,Vermont,Virginia,Washington & Wyoming. |
|
|
ML
4970 Posts |
Posted - 08/28/2007 : 04:55:57 AM
|
| What states are you registered or licensed as a credit counselor or debt negotiator? |
|
|
1stintegritymort
1782 Posts |
Posted - 08/28/2007 : 06:54:51 AM
|
| sorry wizard but i am still skeptical when you say you have an 80% success rate. in california for example when someone bought a house 90% for 800k sisa pay option arm and now with the foreclosures that same house is worth 600k. to get that house down to a 65% ltv is 390k. i find it very hard to believe the bank is willing to take a loss for that much. sounds very fishy to me. like i said, i dont doubt you have done this before and had success, but in declining markets such as california and florida where values are dropping every day, it seems very far fetched to me that lenders are willing to take a huge loss on a short payoff. just like you said, why wouldnt they just short sell it and take less of a loss? i dont believe that these auctions are empty. i believe that now is the best time for real estate investors to step in and make even more money. there are huge real estate investment company's out there that were waiting for this to happen. they are called REIT's and are traded publicly on the stock market. these REIT's will take a short sale and i am sure there are plenty of other real estate investment companies out there that would love to buy a 800k for 600k... let alone 500k... but to settle for 390k? sounds pretty ignorant if the lender is actually going to do that and i dont believe it. |
|
|
WizardLending
161 Posts |
Posted - 08/28/2007 : 07:13:18 AM
|
quote:
Originally posted by ML
What states are you registered or licensed as a credit counselor or debt negotiator?
Wow Stephen, aren't we full of questions. To answer this question as legally as I can, I am not a credit counselor nor am I a debt negotiator. By law a debt negotiator is defined as a company that negotiates settlements on unsecured debt. The terms you are using are geared more towards credit card debt relief companies. I am becoming a member of USOBA and TASC if that helps you any. Are you going somewhere with this line of questioning or just trying to burst my bubble? Because people facing foreclosure need people like me that actually care about their situation. Not some broker that takes their app and throws it in a pile, because they found a better file to work on. |
|
|
WizardLending
161 Posts |
Posted - 08/28/2007 : 07:46:34 AM
|
quote:
Originally posted by 1stintegritymortgage
sorry wizard but i am still skeptical when you say you have an 80% success rate. in california for example when someone bought a house 90% for 800k sisa pay option arm and now with the foreclosures that same house is worth 600k. to get that house down to a 65% ltv is 390k. i find it very hard to believe the bank is willing to take a loss for that much. sounds very fishy to me. like i said, i dont doubt you have done this before and had success, but in declining markets such as california and florida where values are dropping every day, it seems very far fetched to me that lenders are willing to take a huge loss on a short payoff. just like you said, why wouldnt they just short sell it and take less of a loss? i dont believe that these auctions are empty. i believe that now is the best time for real estate investors to step in and make even more money. there are huge real estate investment company's out there that were waiting for this to happen. they are called REIT's and are traded publicly on the stock market. these REIT's will take a short sale and i am sure there are plenty of other real estate investment companies out there that would love to buy a 800k for 600k... let alone 500k... but to settle for 390k? sounds pretty ignorant if the lender is actually going to do that and i dont believe it.
Steve,
The example you give is quite extreme. I know these types of situations exist, but I didn't say I had accomplished such a task at all. I have not ran into such a situation yet. The people I deal with, in a typical scenerio, have a home appraised at $500K. They owe $440K. That's 88%LTV. Typically on this, I would try to take them through a lender that would at least do 70%LTV. Then I would successfully negotiate a short-payoff down to $335,000 (67%LTV), leaving around $15,000 for closing costs. Knocking off $105K on a house of this value is a pretty good deal. Your scenerio using a home that is valued at $600K, but owes $800K is more like starting out at 150%LTV and negotiating down to 65%LTV....ummmmm ya, that might be kind of impossible. I like to help people stay in their home, but I am not a mircle worker! Hell would freeze over before that scenerio would fly. So yes I have to agree, if I had said that I have an 80% success rate on situations like that, I wouldn't believe myself either...lol. First off, I don't charge anything to take a look at a deal. And furthermore, if such a deal came across my desk, I would have to pass. Hope this helps explain it a little better.
Thanks,
Loren G. |
|
|
1mortgagebanker
2 Posts |
Posted - 08/28/2007 : 3:12:16 PM
|
| If negotiating a short-refi were an option for my borrowers, I could pick up a ton of deals here in Indiana. Most calls inbound are seeking help from foreclosure...this could be good. I have assisted a few clients with loss mit departments for anything from a quit claim deed-in-lieu, to a full short sale. In all contacts with loss mit departments from several companies, never did the company suggest this as an option. I will visit your website and try to research this much more. Experience shows that assisting a borrower through this process gives you a very appreciative client for life. |
|
|
ML
4970 Posts |
Posted - 08/29/2007 : 05:49:25 AM
|
quote:
Originally posted by WizardLending
quote:
Originally posted by ML
What states are you registered or licensed as a credit counselor or debt negotiator?
Wow Stephen, aren't we full of questions. To answer this question as legally as I can, I am not a credit counselor nor am I a debt negotiator. By law a debt negotiator is defined as a company that negotiates settlements on unsecured debt. The terms you are using are geared more towards credit card debt relief companies. I am becoming a member of USOBA and TASC if that helps you any. Are you going somewhere with this line of questioning or just trying to burst my bubble? Because people facing foreclosure need people like me that actually care about their situation. Not some broker that takes their app and throws it in a pile, because they found a better file to work on.
Wizard,
Kindly forgive me if I'm "full of questions" because overstating ones capabilities, licensing priveleges, and lending parameters NEVER HAPPENS in the mortgage biz, to say nothing of loan FRAUD.
1) I, and I believe the other members of this forum, are entitled to HONEST answers, not "as legally as I can answers". You either ARE duly licensed, or you are NOT!
2) You have mischaracterized the terms you should be familiar with. Allow me to acquaint you with the law. Debt negotiation includes: Negotiating to defer or reduce a consumer’s obligations with respect to credit extended by others, Debt Negotiation/ Settlement, Foreclosure Assistance, etc. This does not pertain strictly to consumer debt, "geared more towards credit card debt relief companies"
3) "I am becoming a member of USOBA and TASC if that helps you any" It might help you, but it doesn't help me until you are properly licensed.
4) people facing foreclosure need people like me People facing foreclosure need someone who is licensed and qualified to do the job. Someone who has first taken the time to get the BEAR MINIMUM qualifications as required by LAW. And if you think I'm picking on you, I would be no less generous with any individual purporting to broker loans with out the requisite qualifications.
5) There are many folks who need legal help, but I don't offer to counsel them because I'm not licensed in this state. |
|
|
WizardLending
161 Posts |
Posted - 08/29/2007 : 08:58:09 AM
|
Stephen,
Then what about brokers and realtors who negotiate short-sales for their clients everyday. I have ran into several in the last week, that do this on a regular basis. If they can't get the person refinanced, then they have groups of investors ready to purchase, so these people don't end up with a foreclosure on their credit. So they are negotiating short-sales for their clients, as another service to them. I started doing this for my own clients and just want to make others aware that it is an option (short-refi). From what I have read in the past couple days, not everystate requires this. I am all about upholding the law, so if I need it, I will get it, I have no problem with that. Here is a question for you. When searching, I really cannot find anything on obtaining licenses. But, I do find info on becoming certified. Now, to me, certified is taking a class and receiving a piece of paper showing you completed the course. In my opinion, this piece of paper means nothing more than that and I would rather use someone that has results. Kind of like street smarts vs. book smarts. When looking at other loss mitigation services, the only thing I see is maybe that they are certified. They say nothing about being licensed.? What are your thoughts? |
|
|
ML
4970 Posts |
Posted - 08/29/2007 : 09:41:50 AM
|
quote:
Originally posted by WizardLending
Stephen,
Then what about brokers and realtors who negotiate short-sales for their clients everyday. I have ran into several in the last week, that do this on a regular basis. If they can't get the person refinanced, then they have groups of investors ready to purchase, so these people don't end up with a foreclosure on their credit. So they are negotiating short-sales for their clients, as another service to them. I started doing this for my own clients and just want to make others aware that it is an option (short-refi). From what I have read in the past couple days, not everystate requires this. I am all about upholding the law, so if I need it, I will get it, I have no problem with that. Here is a question for you. When searching, I really cannot find anything on obtaining licenses. But, I do find info on becoming certified. Now, to me, certified is taking a class and receiving a piece of paper showing you completed the course. In my opinion, this piece of paper means nothing more than that and I would rather use someone that has results. Kind of like street smarts vs. book smarts. When looking at other loss mitigation services, the only thing I see is maybe that they are certified. They say nothing about being licensed.? What are your thoughts?
I have no beef with someone who actually knows what they're doing, and you sound like you have a clue, it's the other 50-60-90% that DON'T have a clue and happily collect their $395+ fee upfront, and perform little or no service, for folks that really need help. I believe that's what the State legislators are trying to protect against, when passing CCC regulations.
I've worked with local CCC's for years to help people refi out of bad situations. Many CCC's will milk a client dry (for the 15% "convenience fee" that the creditors pay the CCC's) when in reality they should have made a beeline to BK court and be done with it. Conversely, I have seen BK attorneys, who will gladly BK someone who is only $2-3,000 in debt, just so they can get their lousy atty fee, when that person correctly belonged in CCC.
There are abuses all around, and desparate people (many who aren't too bright to begin with) will listen to a song and dance, because they need help.
Insofar as a broker negotiating a short-sale/short-refi, brokers are licensed and/or registered and our disclosures state: our services are consultative in nature, we don't make loans, these are the costs associated with our transaction, etc., etc., etc. Brokers fees (with the exception of modest application fees) are paid upon completion of the job, not upfront. Some brokers are less competent than others. But at least the terms and responsibilities are spelled out. Realtors, I have a problem with. No disclosures, no terms spelled out. Realtors in most instances represent the Seller, and spent years trying to convince the Buyers that they were "their" real estate agent. I am a former NY licensed RE broker. Realtors work primarily for their own self interest, with everyone else a distant second.
Just because others are doing it, doesn't mean you should too. The Stated-Stated loans that everyone was doing, got us into the mess we're in now. Joining an industry association is one good way of codifying and setting standards of performance that this type of industry surely needs, the way things are with the economy I'm sure your service will be in great demand.
|
| | |
