BiggerPockets

I just attended a 1 1/2 hour spiel at the local library from this loan modification company called Home Loan Preservation(HLP). Having just heard Obama's "plan" I was curious to hear what they had to say. Anyone know of them or have any insight?

Here's the poop I got from the meeting. They recruit "consultants" to join their network and prequalify homeowners in need of loan modification. The consultant markets to find homeowners and once connected, inputs the homeowner's info into software HLP provides. Analysis is done real time to determine if the homeowner qualifies to move forward with a modification attempt and if so, the info is forwarded to a lawyer in the network. The lawyer will contact the homeowner and if they move forward with the modification the lawyer collects a $3000-$5000 up front fee (fee is higher for higher loan amounts) and handles the modification. Supposedly this does not violate foreclosure regs such as CA Civil code 1695 because a lawyer is handling the transaction and collecting the fee.

From that point all communication with the homeowner including any documents the homeowner provides is recorded on the site provided by HLP. They claim this provides all the transparency of all that was done for the homeowner should it ever come into question. In addition the homeowner can follow their status real time.

If the modification goes through the consultant collects $1000. There is an semi-MLM component which allows the consultant to recruit and train others and collect fees for those they've recruited.
If the modification doesn't go through the homeowner gets all of their money back (exception is if the homeowner isn't truthful with their info).

HLP was clear to say they are in the business of providing software that enables loan mods and not in the loan mod business.

The fee to become a business center (recruits agents) is $1000 and $249/month and to become an agent only is $69/mo. This of course is to pay for the maintenance of the software, online training, marketing, blah blah.

I asked why a homeowner would pay $3000-$5000 when a loan mod can be done for free and I got the answer I expected which was that they(well the lawyers) have such a high success rate and generally can negotiate a better deal than a homeowner could on their own.

I was also curious to find out what the "analysis" that qualified the homeowner consisted of but ran out of time. My suspicion is that if your temperature is at or near 98.6 degrees- you qualify.

Looking forward to hearing your comments.

I will no doubt tweak some folks off here. But, IMHO, this is just barely better than a scam. Opportunists see a group of "customers" for a service. They pitch this as homeowners needing a service to get these loan mods done. They really see a group of people like you two who are willing to spend some money to learn to "serve" these homeowners. Their real product is the education and their customers are the people willing to pay for that education. No different, IMHO, than 90% of real estate gurus.

Congress does not intend this program to be a opportunity for a bunch of "consultants" and their uplines to extract five grand from these distressed homeowners. Congress is incenting the loan servicers to do these transactions. If this is really worth their while, the servicers will make it easy for the homeowners to do these mods. There won't be any need for consultants.

Its one thing for an attorney who's experienced in a specific area of law to charge someone $5000 to do a transaction that leverages that experience. It another thing for someone who's had a weekend's training to, frankly, scam a homeowner out of $5000 to make a few phone calls the homeowner could make.

I would like to see some real data that says "consultants" have more success at getting mods done than homeowners doing it themselves. Some independent data, not from people involved with the mods. And, data that says someone can take a weekend boot camp and buy some piece of software and be more effective than homeowners. And, that will be more effective when the loan servicers get them minds changed from trying to stall mods to getting mods done.

I have also attended one of their presentations. I am skeptical, but have not said no yet. I do think a couple of these posts are off base. The person that goes out to take the initial information does not negotiate anything on the homeowners behalf and does not collect a fee. I am trying to find out what their success rate is, but do know 6 or 7 people who have gone directly to their lenders to attempt this on their own; actually, I tried it myself. Not one of us was successful. Hours were wasted on hold, etc. I know 2 others who were offered ridiculously bad modifications and both contained charges of $10K to $15K from the lender that were tacked on to the principal. How many of you know people directly who successfully negotiated a reasonable modification directly with their lenders?

I was just introduced to HLP and I think they have a good approach in servicing the homeowners who want to get a loan modification and stay in their home. Despite what you may think a homeowner is better off if the loan modification is initiated by a law firm as opposed to themselves. The attorney knows exactly what to say and who to talk to and how to get the best deal for the homeowner. The bank is buried with foreclosure work and it's money well spent for a long term investment since in some cases the negotiations involve more than one mortgage or lean. The attorney gets their attention immediately but the homeowner will not be able to do that effectively.

Another good thing about HLP's program is how they handle the money from the homeowner. It goes into an escrow account just like a deposit for a house when you make an offer to buy. That way it's not in the possession of HLP and it's held there until the attorney knows that they can help the homeowner. This is a good for the homeowner and it eliminates the fear that the homeowner will get scammed by the salesperson and HLP.

From a business standpoint the bad thing with HLP is they do nothing in providing a way for the affiliate or sales rep to easily source qualified leads. They expect the affiliate to knock on all the doors in the various neighborhoods or ask realtors for a list of their clients so you can contact them. Yes, you could do that but it doesn't work all that well as you will see if you try it. What they should be doing is providing a pre-negotiated "discounted" price with a data base company that can supply names, addresses and phone numbers of pre-foreclosure and early foreclosure homeowners for your specific geographic area. That eliminates a ton of wasted time and lost productivity not to mention your earn capability.

I can tell you from experience that the close rate for a sale person on loan modifications is typically about 50% of the "qualified" homeowners you call on. You have to remember, the homeowner is upset, embarrassed and possibly unemployed so you have work around that and establish a rapport with them. That involves educating them on what will happen if they do nothing…They will lose the house for sure.

HLP is all about the numbers and they are focusing their attention on enrollment for $500 from individuals and the $69 per month software website tracking user fee. The other enrollment fee is $1000 and something like $245 per month for the software website tracking system…

My guess is as time goes on at some point in time the banks will realize they have to begin to initiate loan mod's on their own as opposed to having all that bad debt on their books. Sooner or later that will probably happen but it may take a while since banks are pretty dumb when it comes to common sense…

Good Luck if you decide to use HLP as a business model. They have all the right tools expect the most important one and in my estimation it's providing foreclosure leads…

I believe in what HLP is doing and I will tell you why...FIRST: all negotiations are done by lawyers, I know this because I have used them. I have spoken to a lawyer. SECOND: as a realtor who has a husband who has been in lending for many years, we tried to negotiate our own and got NOWHERE. How do you expect joe public to be able to negotiate their mod if 2 people with years of experience were not able to do it. THIRD: there are a MILLION new companies popping up, employing the same unscrupulous loan officers that helped get us where we are. They collect $1500 to $5000 up front, pay the agent right off the bat, usually a third to half of the mod cost and when they are not able to help, because they have loan officers trying to negotiate, they refund only a portion of the clients payment IF they refund anything at all. And these same unscruputlous ex-loan officers are doing this knowing that they arre getting paid regardless of actually helping anyone...greed at it's best.

I just caution that before you bash HLP, do your research and see what they have done for people like myself THEN compare them to 99% of the other crack-pot companies out there...

Sorry to bring up an old thread but I wanted to provide some information to anyone who may be looking into signing up for HLP. DON'T DO IT!!!

I also attended one of their workshops a few months ago and it all sounded great. I mean, you get to help someone who is in desperate need and make money while doing it? You know the old adage "if it sounds to good to be true...it probably is"? This most definitely is the case with HLP.

THANKFULLY, I waited and kept doing research (initially I could not find ANYTHING about the company). I ran a google search on the address I found on their OLD site (they have since changed the site and the address). The old address didn't exist, or I should say the suite # for the address didn't exist. The address itself did exist, but it was for a completely unrelated business. I also looked up Loss Mitigation Network (the lawyer network they claim to work with). My search led me to the sight of a random attorney out of state and nowhere on his sight did he mention HLP, although he did do loan modification services.

When I went to the seminar, the guy hosting the event said business was SO GOOD that he had signed a lease on office space and was going to be opening an actual HLP Regional office. He could not have possibly known the location he mentioned was right down the street from where I live. It's been 5 months now...that office has never opened.

At the time I went to the seminar, I was really intrigued because I had just been laid off and was falling behind on my mortgage. I had originally thought, "Wow, if they can actually help me, what better selling point could a person have than 'I did it myself and it worked for me'?". Again, THANKFULLY I did not follow through with that idea. I was actually able to work my own loan modification with my lender and it cost me $0.

I kind of forgot about HLP after awhile, but I ran across something for it a few days ago and here is all the info I think anyone should need on this company or any other loan modification companies:

http://www.dre.ca.gov/cons_drs.asp

Scroll down to Home Loan Preservation and click on the H-# column.

Hope this info. is useful to someone.

I will support John's opinion that

"Their real product is the education and their customers are the people willing to pay for that education. No different, IMHO, than 90% of real estate gurus."
Its very true and smart from their end. we basically offer the services for this cause.

Bill, you're totally right--real estate fees and legal fees cannot be intermingled. Any decent lawyer wouldn't touch that situation with someone else's ten foot pole. Also, this may be new info for some of those in this thread, but it is now illegal anyone in CA, including lawyers, to charge up front fees for loan mods due to all the scamming that's going on. Anyone even charging money (even after the loan mod is complete) needs to post a $100,000 bond and file an $850 application at the CA Attorney General's office.

Here is a link to the law:
http://ag.ca.gov/consumers/pdf/mortgage_civil_law.pdf

This is a link to more loan mod people/companies being sued by the Attorney General:
http://ag.ca.gov/loanmod/

This company looks like bad news all around, if they were shady before, now they're definitely conducting illegal activity.