Using your servicers attorney

12 Replies

Curious to get others opinions but has anyone EVER had a desirable outcome from using your servicers attorney?

If I was “forced” to use them I find they are:

1. Lazy

2. Lack communication skills

3. Extremely slow

4. Rack up costs

I would also not recommend asking your servicer who they use or recommend as I know of an attorney a servicer recommends and they are the biggest POS on the planet.

Always ask other investors and IF THEY USED THEM. I see far too many people recommending individuals they have not personally used because they read a post on Facebook etc.

I had a servicer’s attorney tell me I lost an asset at tax sale when I actually didn’t. They found an old tax certificate and got confused. It had been redeemed a few years ago. It scared the hell out of me and I didn’t feel better even when I found out they were wrong. So I prefer to pick my own attorneys too.

@Chris Seveney The issue is not the attorney, it’s that no attorney is involved. The firms your referencing typically rely on paralegals to do all the work. That’s fine if it’s a good paralegal, but if you get a bad paralegal it’s a disaster. 

It’s a huge problem for me as an attorney because I know how the process should work and recognize when they are being lazy and not working the file.

I tried it a couple of times as I was getting started years ago.  Bad idea.  I ended up working with the attorney directly anyway because the servicer was not managing things at all.  Just a bad idea.  My advice, hire your attorneys directly.

@Mike Hartzog

I agree. When starting out you try and outsource as much as possible to reduce your liability but you increase your financial risk sometimes because of two many cooks on the kitchen.

It’s one of those things that you almost want to tell a newer investor to try it so they can see how “painful” it is as it is a good learning experience.

I've actually not had an issue with attorneys referred to me by my primary servicer, FCI. Although now I will contact Daniel singer and ask him for a referral since he's got a pretty good Network especially when it comes to foreclosure attorneys. 

Originally posted by @Chris Seveney :

Curious to get others opinions but has anyone EVER had a desirable outcome from using your servicers attorney?

If I was “forced” to use them I find they are:

1. Lazy

2. Lack communication skills

3. Extremely slow

4. Rack up costs

I would also not recommend asking your servicer who they use or recommend as I know of an attorney a servicer recommends and they are the biggest POS on the planet.

Always ask other investors and IF THEY USED THEM. I see far too many people recommending individuals they have not personally used because they read a post on Facebook etc.


Chris, I don't understand what the likely scenario would be in which you would need to hire your servicer's attorney. Perhaps the borrower stops paying and now you need to start sending them notices in the mail in accordance with their state laws, or worse, begin foreclosure? And because the property might be in TX and you're in MD, you probably can't use your local attorney, so you just the servicer to get a referral to who they use?

And, in a perfect world, part of doing the proper diligence ahead of time involve find an attorney in that state early on before there is a problem? 

@Paul Winka I think Chris means that his servicer would recommend an attorney in the state where the property is located. FCI has a list of Fannie Mae authorized attorneys for every state. I've had good results with this over the past few years

Originally posted by @Chris Seveney :
1. Lazy

2. Lack communication skills

3. Extremely slow

4. Rack up costs


Agree whole heartedly.  I wouldn't and don't... (and in many cases the adjectives also apply to servicers we've had).

If it's ok to extend the conversation, has any had any luck picking up an attorney that was working a NPN when you purchased it. We tried several times thinking it would save time and only found we had to go find (or use existing) attorney's.

 

@Bob Malecki we've had a combination of i) poor communication, ii) crazy billing (we once had a 45 min charge for reading and replying to a single email - 3 questions that we had explicitly instructed and worded for yes / no answers) iii) lying about who was performing work and what work was performed (they were job shopping our work to an out of state attorney) and iv) poor performance (weeks to subcontract and execute service).

I once had a paralegal (or legal assistant, can't remember which) from an attorney's office try and tell me that a pending HOA foreclosure was wiping our 1st mortgage so they wouldn't proceed with our foreclosure action any further. I didn't take long to switch legal firms......

@Bryan Hartlen We generally use whatever attorneys that our sellers are using when there's a foreclosure in progress. As soon as we buy, we contact the foreclosing attorney or firm and assess the progress. (We don't wait until interim servicing is completed. We get resistance from some who tell us that the transfer has to be completed first.) We set our expectations and some firms adjust and some don't. Some firms act like they're calling the shots. They won't keep us for clients if they do. We end up keeping about half of the existing attorneys or firms. The other half, we replace with attorneys who are competent.

No one care about your asset as much as you do. You have to set expectations and make sure that your vendors are doing things the way that you want them done. If not, find another vendor.