BiggerPockets

No Bad News For Realtors

Thursday, February 24

In November 2006 at a weekly real estate marketing meeting a broker named Craig stood up and said he thought it may be a good idea to disclose to buyers that values may not continue to increase at the exponential rates we had been experiencing.   He almost needed security to escort him out.

 

Oftentimes professional sales people make the mistake of avoiding any news that could be considered “negative”.  I believe it is important to point out that there is never really any bad news,  only clues for new opportunity.

 

Imagine if an agent had listened to Broker Craig and made some changes in his marketing plan based on the fact that values may not continue to increase.   He may have attended a BPO certification class and started making money doing BPO’s.   He may have gone to the asset management sites when they were soliciting for new agents and found a link on their site “click here to sign up to be an approved REO agent”.  He may have even taken a hard look at his own real estate portfolio like Sean O’Toole the Founder of ForeclosureRadar who was busy liquidating his real estate investments in 2006.   

 

The news today is filled with stories on modification failures, strategic defaulters, negative equity, unprecedented delays in the foreclosure process and litigation. Some of the folks I have interviewed for our ForeclosureRadar Short Sale report have indicated that they believe short sales will become easier this year.  What if 2011 does become the year of the short sale?

 

You cannot afford to look at market news as good or bad. People still desire to live in a home regardless of whether the interest rates are high or low, delinquencies are up or down, or the median home price is lower today than last month.  One thing is for sure, the news will always provide you with clues that may affect how your business looks in the future.

 

I am sure we would all agree that there will be a lot of homes bought and sold in 2011.   The rest is just marketing strategy.

ForeclosureRadar 2011 Market Predictions

Tuesday, December 14

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A few month’s ago my boss, Sean O’Toole, the Founder of ForeclosureRadar, came to me and asked me if I thought there was a housing bubble.  I should have known it was a trick question!

After he let me answer he quickly showed me a chart and explained that it was NOT a housing bubble but it was in fact a credit bubble and he went on to explain that he had researched the history of home values and every spike in value could be attributed to government loan programs or lax lending standards. http://www.foreclosuretruth.com/blog/sean/want-to-know-when-prices-will-rise/

Based on this historical perspective it was no surprise to me to read Sean’s 2011 Housing Market Predictions where he states “The government’s role in housing is so huge that decisions made in Washington, and our state capitals, over the next twelve months will have more impact on home sales and prices than any other factor.” http://www.foreclosuretruth.com/blog/sean/the-only-surefire-2011-housing-market-prediction/

Just in case you think I am a card-carrying member of Sean’s fan club because he is my boss, think again.  Any real estate investor that liquidated their real estate investments in 2006 at the peak of the market should certainly have an audience when he gives his predictions.

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It's OK to Be Early But Always Show Respect

Tuesday, December 14

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At ForeclosureRadar we track all public record notices.  I routinely hear from people who are looking for “mortgage lates”.  What they want is a list of people who have missed loan payments (30/60/90 days late) but are not yet in default.

It is possible to purchase delinquent loan data.  If you have not done a credit opt out  (http://www.ftc.gov/privacy/protect.shtm) then all of your credit history can be sold.  Years ago I knew a lender that purchased “loan triggers”.  This was a list of people that had a credit report pulled for purposes of getting a home loan and this lender would buy that data so that they could target that individual.  It is important to know that all credit data can be purchased for a price.  Now you know that if you get those pre-approved credit card solicitations in the mail it is no coincidence.

There are seminars out there that teach real estate professionals to go after homeowners with “mortgage lates” to see if you can get a short sale listing.  Keep in mind that when you purchase this “mortgage late” data you must use it in compliance with the Fair Credit Reporting Act (http://www.ftc.gov/os/statutes/031224fcra.pdf) since this in not information that is a matter of public record.

A couple of years ago Sean O’Toole wrote about the 5 stages of grief and how they apply to homeowners in foreclosure.  It is probably not surprising that one of the early stages is anger.  He wrote “I suggest it is important that you learn to have some understanding for which stage your customer or partner may be in at the time. For example a homeowner that is currently in the anger stage may be better left with some comforting words and an offer to follow-up rather than a full-tilt sales pitch”. http://www.foreclosuretruth.com/blog/sean/foreclosures-and-five-stages-grief/

Getting there early only means making a contact, not looking for a fast way to get a listing.  If I had to give an analogy I would liken this to selling burial plots.  When people are in need they will have many questions and be grateful that you are there.  If you try to “get to folks early” by hanging out in the emergency room thinking that a certain percentage will need your services you could risk offending those that have not yet given up hope that they will recover.

At the end of the day, this is a relationship business.  It isn’t about being the first one there it is about being the person that is there when the time is right.  Most importantly, being the person that is there with good information and compassion to help folks make the decision that is best for them not for you.

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Marketing SB931

Monday, December 13

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There’s a new law taking affect in California on January 1, 2011 that could provide additional relief for homeowners seeking to Short Sale their properties.  Although it only affects first mortgages, Senate Bill 931 (http://www.aroundthecapitol.com/Bills/SB_931) may offer additional protection for those homeowners that really want to avoid a foreclosure.

Short Sales Prior to SB 931 allowed the lender to pursue collection on a deficiency if the short pay agreement did not have full satisfaction language. SB 931 prohibits banks from pursuing deficiency judgments against sellers on 1st liens in California, regardless of whether the seller has refinanced or pulled cash out.

In California, once a seller has refinanced their mortgage, whether it is a cash out refinance or simply a refinance to lower the interest rate, the loan becomes a “recourse loan”, meaning the bank can pursue the seller after the short sale for the deficiency, unless they state in writing that the debt is settled on the short sale approval letter. SB 931 prevents banks from pursuing short sale sellers on all first mortgages in CA.

Now is the time to reach out to homeowners and let them know about the new law.  RadarPrint.com the third party print site of ForeclosureRadar.com has just posted a new SB931 postcard specifically designed to announce the new law and encourage homeowners that may be interested in additional information to pick up the phone.  We hope you find this helpful in getting conversations started with homeowners in distress.  You won’t know if you can help them until you get them talking!

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Market Update on REO's

Friday, July 16

We have recently seen a decrease in the number of new foreclosure filings (See the CA Foreclosure Report http://www.foreclosureradar.com/foreclosure-report/record-number-foreclosures-cancelled).  We also hear the the number of seriously delinquent loans continues to rise. (See the ForeclosureRadar facebook page 7/12/10).  If you are a REO listing agent or working with investors your question is probably the same as ours... "what's up??"

We sent this question to numerous sources. We chose some asset managers, bank executives, top REO agents and even a contact at Fannie Mae.  The best repsonse that we received was this:

"My thoughts are that this is for the most part due to HAFA. Now that most servicers have systems in place to administer the program they are removing delinquent loans from the foreclosure pipeline to allow a reasonable short sale time period. Predictably (also my opinion) the period would be expiring just AFTER the November elections so there would be less political blowback as those properties that don't conclude with a successful short sale are taken to Foreclosure and ultimately, REO"

Since Realtors and Investors are always trying to speculate where the market is going and where the opportunities may be in the future we thought we would share this with all of you.

FORECLOSURE MARKET UPDATE

Wednesday, June 23

The Founder of ForeclosureRadar Sean O'Toole will be giving a webinar on the Foreclosure Market tomorrow, June 24, 2010 at 10am.  Don't miss this opportunity.

He will be talking about where we are and how we got here as well as how the government programs are affecting foreclosures. Hear what he has to say about future real estate opportunities. If you've heard Sean speak you know that he predicted that last market turn and liquidated all of his investment properties at the peak of the market.   

You will surely want to hear Sean question whether or not there really was a real estate bubble, whether foreclosures cause price declines, and if real estate actually appreciates. 

Register HERE: https://www2.gotomeeting.com/register/116935026