PEOPLE! … THERE IS NO SECRET TO DOING A LOAN MODIFICATION! – Over 9 Million People Will Qualify!

Doing a loan modification is easy. All you need is the right instructions and the forms the lender will require. Frank Wible, the nation’s number one short sale realtor has performed hundreds of these loan modifications for his clients.

NOW, the same documents and instructions that have been used by his staff are now available for download. You will not believe how easy it is to modify your own loan. It’s time to take advantage of this governmental opportunity to reduce your payments and possibly, your entire loan amount.

Take a look at the website we have setup for you and you will see what we mean…
NewLoanPackage.com

Frank Wible, LLC
Turnersville, NJ 08012
fwible@gmail.com
Phone: 856-745-7700
Fax: 856-228-4433

PS: Realtors and Agents are welcome to use this package to provide Loan Modification Services for their clients

In February, I successfully completed and closed a short sale with Countrywide. The process was a nightmare and it took almost 6 months to get completed (many complicated issues on this one).

I represented the buyer and the seller in this transaction. Although I was able to keep it together, the buyer was frustrated by the time it closed. But, all is good now, they are happy with their purchase.

Now almost August, the new owner calls me today (6 months after he closed) FREEKING out. Why? Because he has a notice on the door that the home was just sold in Sherriff sale!

After the call from the new owner, I ran to the office. I pulled the file and reviewed everything...it was all fine.  I called Countrywide immediately.  After reviewing the documents with the person on the phone we discover the loss mitigation representative reversed a digit in the account number on the approval letter and closing instructions. OMG!!  So OK, how are we going to fix it!??

That loss mitigation representative and their boss no longer work at Countywide. The account we wired the money to is a Bank of America account (we closed right in the middle of the merger), and the person I had on the phone had no idea what to do. The highest person I could get to; the regional director also had no idea what happened and what to do about it. They told me they will start an investigation! WHAT DO I TELL THIS HOMEOWNER RIGHT NOW?

The moral of this story, and it is a true one, verify everything on your approval letters. Do not leave anything to chance! I have no idea how this is going to turn out, but it's a big mess!!

I can honestly say this is a first for me!

Good Luck!

Frank Wible

If you read 100 different agent blogs about foreclosures and short sales and you undoubtedly will have 100 different opinions about how to successfully achieve and complete one. You will also hear to (1) avoid them if possible; (2) tasks to complete when you have a short sale listing; (3) what you should do first; (4) what lenders to avoid and which to work with; (5) and what to do as a buyer or seller stuck in a short sale scenario. All good advice by the way…and there really are no wrong opinions. This is a business that truly has no rules, and as much as "the experts" would like to give you advice to this problem, it really is a "learn as you go approach." Each problem and situation is unique.

Providing advice via a blog like ActiveRain, seminars or training classes; criticizing or bashing lenders about the short sale process; and giving our own personal direction and secrets on doing short sales all seem to be a tactical and misguided approach to the overall inflating foreclosure problem. As agents and legal professionals, what is our strategic approach to resolve this problem? Tactical vs. strategic defined as: If you no longer want milk in this world, do you take on the overwhelming task of killing every dairy cow in the world? (Tactical approach), or do you simply destroy the few dairy farms that are producing the milk? (Strategic approach)

It's fairly obvious that a tactical approach to our nation's short sale problem is never going to get the job done. We, as professionals need to define a strategy that does not include facing this major systems flaw one short sale at a time.

I've completed so many short sales I've lost count. I've trained agents across the country on every facet of short sales, and I've done radio, television and blogged until my fingers hurt to help and assist homeowners and agents facilitate and streamline the short sale process. Overall, I feel great on the work that I have done, so why does the situation seem to be getting worse? Like most, I did not focus on the strategic problem, only the tactical solution.

Recently, my focus and energies have been to create a group of professionals and with the help of some of the top consulting firms, address these lender process issues from a more strategic approach. This goes way beyond me trying to create a short sale business selling homes; it's more of a 911 call to the lenders. (If you've completed quite a few short sales in your area, and would like to be an professional associate in this venture, you can email me directly fwible@remax.net).

For example, a hedge fund buys the paper (a mortgage note) from the lender. The purchase price for this note is thirty seven to forty five cents ($0.37) on the dollar. The lender sells 500 notes to this hedge fund, and they are paid "today", in advance for these notes. However, the hedge fund requires the lender to continue to service the note until a short sale or REO sale is complete. When money is ultimately collected, all proceeds go the hedge fund. Remember, the lender already took the loss and got their money back at the beginning! Have you ever heard as a short sale agent, the "investor" has to approve this? Now you know what that statement means. In some cases, it's the initial investor of the loan, but lately, not often.

What motivation does a lender president or CEO have to implement a streamline process in order to facilitate a quick short sale? They have already taken a loss on the note when they sold it to the hedge fund, received their money upfront, and now are nothing more than collection agents for the hedge fund. And remember, in most case they do not receive any additional money once the loan is closed with the borrower (via a short sale or payoff). Have you recently receive a counter offer on your short sale that you thought was crazy? That could be the lender trying to receive a bonus for collecting more than the hedge fund was expecting on the return. Additionally, lenders are paid, (almost as commissioned agents), from the hedge fund if they have to take the property back and sell it through their REO department. In other words, they get paid more to take it back!

If you as a short sale agent ever thought you were fighting an uphill battle, you're right. This is big business and huge profits are made on these hedge fund levels. I personally never have a shortage of hedge funds calling me asking if I have REO tapes (lists) for purchase. Now we all know why.

So, the lender collects the money they need fast (to stay afloat and pay margins), the hedge fund makes a ton of profits for their investors, and the collateral damage is well worth the return.

The major flaw is simply that the damage it is creating is more than just collateral. We see the damages continuing and starting to worsen and dig deeper as these hedge funds continue to get rich. The real estate market is never going to correct itself as long as qualified buyers continue chasing the fantasy of this foreclosure inventory. If this continues, traditional inventory will sit much longer and become stale. It could even force traditional listing into short sale or foreclosure scenario. This circle will never end until this is cleaned up. As we see it, this will eventually affect more people than they can call collateral. Just FYI, quite a few politicians have money in these hedge funds!

Don't believe that greed cannot blind! The amount of money being made at levels is more than you and I may never understand…is amazing. Let's face it, if that was my/your money in the hedge fund we would not see the flaw either, or maybe we would not want to (blind by greed).

The example above is only one of the process flaws we've identified in the lender short sale systems. So I ask, helping sellers on an individual short sale basis does help, but how much? We are so focused on the tactical planning, training, education and assistance of the short sale that we never thought about if we were really helping the overall situation. And do we care? We as agents have to make a living, so knowing how to do a short sale is not a bad thing and it keeps us going. However, overall, I would rather focus my talents and knowledge to assist in the normalization of this insane market. My opinion is that it does not, or did not, have to be this bad, but studies show it will get worse before it gets better.

Thanks for reading!

Frank Wible

Jack Broad wrote a very compelling article about the time lines from State to State. I would never post his entire article, however I will post some of his data. (His website: http://www.theticasystems.com/)

Jack wrote: In this article, I want to convey some thoughts about foreclosure timelines.   What they are and how they can impact various market participants.  Recently I performed an analysis of state-level foreclosure timelines.   Here's some of what I found. ----

Fastest Foreclosure States (listed alphabetically)

State                     #Months
Alabama               2.34
Arkansas               3.08
DC                          2.70
Georgia                 2.58
Maryland             2.79
Michigan              3.22
Missouri               2.06
New Hampshire 2.88
Tennessee          2.15
Texas                    2.85
Virginia                 1.89

Slowest Foreclosure States

State                     #Months
Delaware             6.92
Florida                  6.13
Iowa                      8.54
Illinois                   7.28
Indiana                 7.23
Kentucky             7.34
Louisiana             6.19
Maine                   8.83
New Jersey        7.51
New York            7.05
Ohio                      8.03
Pennsylvania     7.10
Vermont              8.39

Since I started serious blogging about foreclosure and short sales, my national referral business has exploded. I have given out quite a few referrals nationwide. Yet, to this day, I still have no idea how a short sale or foreclosure agent can help a client that let's say lives in Maryland where the process before a client is on the streets is less than three months. We all know (for those of us that do short sales), that it takes much longer than three months simply to get a short sale approval. What can you tell these clients and how can you help them? Being that my national referral business is really starting to climb, I would like to know what your process is to help these people in the states where the foreclosure process is so quick. Please post your comments on what can be done and what you do to help. Thanks for your feedback. Part of this post is for my business research, but most of it is because I feel the stress my clients have (and put me through) when we in New Jersey have quite a bit of time, I can only imagine how your clients (and yourself) feel when the time line is such a crunch!!

Frank Wible
REMAX ALL PROS

When you negotiate your client's short sale, there is no doubt that you and the buyer's agent stand to have the commissions cut. It has become more common and understood that when involved with a short sale, you will be paid less.

You don't want to post this assumed cut down commission in the MLS because the lender may in fact pay the full commission, or even higher sometimes. So you take the listing at 7% (just in case they cut you), and you publish 3.5% in the MLS. Once you have an offer, you start the process. Months later you are approved, but with a cut commission (of course), and you settle.

Just so we are all clear, no matter what the lender cut your commissions down to (normally 5% - 2.5% for each broker), you published 3.5% in the MLS. The buyer's agent and broker DOES have the right to seek your office for the remaining amount between what they received at closing from the lender and what you published in the MLS! If this happens, it can only add insult to injury when you've worked so hard just to get your listing closed.

Even in the contract you've created and sent to the lender says 7% as you try to slip that larger amount by them. However, to protect yourself, you add in your contract that "commissions are subject to the same third party approval." Yes, we agents know the deal. We know if our buyer's purchase a short sale our commission can be cut. This is now just a general understanding among agents. Or is it?

Remember, what is published in the MLS is what YOUR office is offering, not what the seller is offering. It's your office listing! So are you responsible for the balance? I sure hope I do not start a landslide of agents going back to their short sale deals and trying to get more commission from this post, but I want to know what everyone's thoughts are on this topic.

I recently started to post "50%CS" or "Fifty Percent Commission Split" in the MLS. I place in the agent notes that the listing was taken at 7% but subject to third party approval. This issue has never come up with my office, but it gives you something to think about!

Frank Wible

Just FYI for all agents not doing their own loss mitigation/negotiation work for their short sales...

H.U.D announced that legal fees for sellers, processing fees, loss mitigation fees, as well as many other fees will NOT be allowed on a short sale settlement sheet where the home was purchased with, and shorting an FHA loan. This was a major hit for quite a few deals going on from what I understand. My lawyer friends that do loss mitigation work for other agents and are paid on the settlement sheet for legal fees to the seller lost 30% of their files today (because they now can't get paid).

Loss mitigation companies that charge for their services on the settlement sheet back to the lender will be removed from this as well. Make sure you check with your sellers to see what type of loan they have if you are outsourcing your negotiations. Ultimately the money for these out sourced services (if you need to outsource it) has to come from somewhere, looks like the agents are about to take another hit on their commissions!

Any comments or further details on this subject are welcome.

Frank Wible
REMAX ALL PROS
http://www.ShortSaleNJ.com/

The short sale foreclosure business seems like a smart place to start when looking to enter the investment properties business, but is it? Being an investor for many years before I started my career as a Realtor, and seeing the business from both sides, I'm not sure that it's something worth getting into.

Sometimes the temptation to get involved with a short sale deal is great, but each time I find it better for me to walk away. The sheer intrigue has lead me to explore different options that other investors have presented (to me) for purchasing short sales. Each one always lands at a dead end. I will create a blog posting for each that has been presented to me (just for length issues alone). Any comments are certainly welcome.

The straight through title…
Investors have approached me on this quite a bit. The seller signs the quick-claim deed of the house over to the investor, and the investor hires me or some other agent to sell the house on the market. All-the-while, the investor has it under contract to purchase the home as a short sale. Sometimes they even want to hire me to capture both sides of them purchasing it and negotiate the short sale itself. Greed can really kick in, and this starts to sound real good. You get both sides on the initial purchase and you will get a least one side when the retail buyer buys it from the investor. To a starving agent this sounds really good! The problem is this. If you place the home on the market and get offers higher than the one you presented to the lender from the investor, there is an element of mortgage fraud on your part. Additionally who do you represent? The investor never filed that deed, so the homeowner is still on the hook for the mortgage, deficiencies, transfer taxes, etc. And quite frankly still owns the home. If you know the home is worth more (and the proof is in the higher retail offers you have been getting while on the market), you are screwing the lender and possibly the home owner in the deal. This is bad!

Now you have sold the home on the market and the investors short sale is approved (let's say for $150.000 short sale approval and a $190,000 retail sale). The investor is happy and you schedule the closing. But wait, whose name is on the retail contract of sale, the original home owner or the investor? Most likely it will be the investor even know the deed has not yet been filed. Ok, so you go to closing. Now the investor wants to so a simultaneous close. He has convinced the title company to close the retail deal first and use that money to fund the deal of him buying it. Don't laugh; I have seen this done quite a bit! These are the non-closing investors…the ones that try to do a deal when they have no money to close first. The title company does a class A title from the homeowner to the investor and never insures it. The retail buyer uses the same title company so they insure it then, so it should be OK…NOT! Even if the investor owned it for a split second, and the title is passed straight through, if that investor has judgments, the title is not clean to the retail buyer. Wonder what will happen when the retail buyer goes to sell it? What a STUPID title company!!!

In this scenario, so many laws have been broken and so many things went wrong. Yet, every day I hear it being done. So many investors have asked me to do this with them, and I simply walk away. Everyone has the story about the guy that made $30k for doing nothing. Did you hear about the 25 guys that are now facing law suites and possible jail time because they did the same thing. Be careful when investing and always have a lawyer review your process. The short sale business has become a large flood-gate for people wanting entry into the real estate investment world, but make sure it does not land you in jail! In the days to come, short sale deals that take place will be under a huge amount of scrutiny and you want to make sure your deal is clean. The bottom line is, when it comes to a short sale deal. Purchase the deal if you can at a good price…CLOSE IT…then sell the property. It's not the "No Money Down" way they tell you can happen on TV infomercials, but I'm telling you it's the only legal way in my opinion. And again, I don't know the laws in all states.

My next post will be about the new and fancy "transfer deed to a real estate trust" process.

Frank Wible
REMAX ALL PROS
Foreclosure and Short Sale Authority
http://www.ShortSaleNJ.com/

Each and every short sale holds hostage a buyer waiting to know if they own the home. If an investor is the buyer, they can wait for the answer, but what about the young couple waiting to see if this is going to be their new home? The wait could be devastating.

I have agents working for me on my team, and even they're beginning to say, "Frank, we would rather show our buyer a home that's not a short sale." In many ways, I am starting to agree with them. Sure, short sales may be a great deal sometimes, but with lenders now looking for almost full market value, is it really? Plus, is it worth the long delayed wait?

Lenders seem to be so focused on protecting their investors and creating their profit and loss on the deal that they forget there is a buyer allowing this deal to exist at all. Sure, it's not really the lenders problem, but if they think about it, it soon might be. Obtaining buyers in my business is not hard; selling short sales and foreclosures is very sexy business. Everyone wants to work with the foreclosure agent because they have the best deals and buyers think we hold the key to the treasures. When foreclosure agents begin to say they don't want to show a short sale to their own buyers, this speaks volumes, and should make the lenders take notice to the problem!

I'm sure my agents aren't the only ones that feel this way. With this rumbling starting to take place now; soon the masses will be made aware of the issues, if not already, and begin to walk away. Lenders will no longer be bogged down with short sale applications, because there won't be any buyers for these foreclosed properties. Short sales and foreclosures will become known as the "the good non-obtainable deal not worth pursuing."

Short sale listing agents complain about the time it takes for a short sale to be approved, yet we push forward to assist the sellers in a bad situation. The buyers however seem to get lost in the shuffle and are expected to be patient with the good deal they are getting. Buyers that leave the deal while waiting for an answer are tagged as "uncooperative." This could not be farther from the truth. How can we expect them to put their lives on hold as we protect the sellers from the bad situation they face with the lenders? In fact, additional wait time is sometimes a good thing for sellers.

Lenders seeking market value only continue to hurt themselves as broader marketing and additional buyers that assist in driving the price to this value disappear. Buyers that do dare to venture continue to cancel contracts after long waiting periods, and short sale agents continue to work harder for nothing. The only remaining buyers will be investors that will drive the prices opposite of what the lenders expect. It seems to me that the short sale craze for traditional buyers could come to a fast halt.

Lenders and hardships have placed homeowners in very bad situations. I will always continue to help these people! It's what I do, and what I'm passionate about. However, my next sales meeting with my staff will be the green light to avoid short sales if they so choose, and bring their clients/buyers to non-foreclosure homes.

Thanks for reading my blog posts;

Frank Wible
REMAX ALL PROS
ShortSaleNJ.com

The foreclosure process is just that, a process, not an event. Once you have missed payments, a process will begin in order for the lien holder, your lender to take back the property. Some states are so quick while other take much longer (see chart below).

Unless you live in Tennessee or Virginia, you do have time to deal with the issues and possibly save your home. I'm not sure what the deal is with those two states, can anyone shed any light on the subject and confirm this time period being true?

Either way, when my mailings go out to people that are in foreclosure, it's a staggering number of returned postcards marked "property vacant." Most people think once they receive the notice of foreclosure, there will be a police officer or sheriff at their door in a few hours to remove them. Other feel as though there is a huge sign they nail to the front of your house that says, "This house in foreclosure because they did not make their payments." So embarrassed by the thought, they abandon the home. I'm not sure about all states, but in New Jersey, none of this happens. Make sure you call a lawyer or real estate professional in your area before just walking from the home.

On another note, and there may be some bankruptcy lawyers here, so I'm sorry, but what is the deal with telling your clients to simply walk away from the home? Why would anyone want to do this? I hear this all the time, and I don't understand why the homeowner should do this. Is a short sale or possible regular sale not better? I know if there is equity, you need trustee approval to sell, but why not try instead of making a recommendation to just walk away?

Real Estate agents that are in the foreclosure and short sale business will always provide you with additional options when you're facing foreclosure.

Thank you for reading my blog!

Frank Wible
REMAX ALL PROS
ShortSaleNJ.com

Buyers, waiting in the wings to purchase that fantastic deal on their new home may not want to wait much longer. Personally being a major name in the foreclosure and short sale markets, buyers contact me constantly asking me to find them that steal, and willing to wait for it. Working with many of them, I'm starting to advise not to wait for that perfect deal/steal. Being a buyer in this market has afforded you the time to wait and see, but this time may be coming to a close. Interest rates falling to new lows have sparked even the most gun-shy buyers to pull the trigger. Traditionally, February through June has been the busiest months for home sale transactions, and it looks like we are off to a great start for this year as well.

Over one hundred and twenty five showings already logged for my listings the first three days February. This compared to only sixty eight the entire last week of January. Smart buyers are now thinking this is the time to move forward may leave the deal you've been waiting for unavailable. At my closing on Friday, my buyer purchased a $300,000 home with a fantastic payment of around $1574.00. The interest rate was bought down to below five percent, and the value of the home came in at around $340,000. This buyer saw the opportunity to own a new home, with $40,000 in possible equity, for a little more than he was paying for rent.

I cringe when I make the statement "lenders know what's going on," but on my short sales, lenders have started negotiating to "market value" in order to be accepted. What do they know, and what do they see to begin this shift in their short sale and foreclosure decision making? They don't want them back so how do they know they will obtain market value if they wait? Although greed blinded them in lending money during the boom, I guarantee they are monitoring everything closely now.

Buyers in today's market are in a much better position than before, but may need to make their move in order the seal a great deal. So close to the foreclosure and short sale market (a major factor in what drives the market down), I see the winds of change. Thank God for the global economy, it's looking like strong stabilization is coming.

FRANK WIBLE //Turnersville, NJ// For more than two years, unpleasant surprises and market rumors have continued to create mayhem in the real estate market.  Government agencies, although ambiguous, have announced repeated solutions for homeowners facing foreclosure; however, are lenders prepared to provide this support?

Countrywide Homes Loans, the largest lender in the nation, is reportedly receiving over one hundred and fifty short sale applications each day. Loss mitigation and customer service departments are so overwhelmed with requests that it could take as long as six weeks simply to be assigned an account representative. 

The process of homeowners seeking foreclosure resolution from lenders seems to imitate the "take a number" line at the local deli. Even after communication is achieved, does the lender's proposed solution warrant the wait? 

Homeowners struggling with their mortgage payments are offered a "loan forbearance" almost immediately.  This forbearance agreement creates equal monthly payments to pay off any past due amount on the loan. The repayment plan is based on the homeowner's current financial situation, and a large deposit is normally expected from the homeowner upfront.  Once an agreement is reached, the homeowner makes the added payments each month in addition to the normal mortgage amount. Helpful for some, homeowners currently struggling with their mortgage payments often cannot afford the extra payment each month. In most cases, this solution will only delay the inevitable, and can be a formula for quick devastation.

Another solution, "loan modification", may also be available, but is much more difficult to obtain or even be offered by the lender. Utilizing the existing mortgage company to refinance the debt, extend, and/or change the terms of the debt, back payments are added to the principal balance and a new loan is created. The interest rate and payments are normally higher, but in most cases manageable.

A short sale is a proposed solution we hear lenders offering clients regularly, and is the process of the lender or lenders accepting a discounted payoff on the mortgage and allowing the homeowner to sell the home and avoid foreclosure costs.  Lenders are quick to offer this solution, but huge backlogs make the process painstaking for both the borrower and buyer of the property. 

If this insurmountable task of dealing with this overflow is even possible, lenders need to address the situation as foreclosure numbers increase throughout the nation. Lender representatives I have spoken to directly, where backlogs are so massive, obtaining a resolution to save each home due to this backlog is impossible.  "Well, sometimes we just have to write them off", said this senior loss mitigation representative.  National title company representatives we 'have spoken to believe that lenders are letting properties go into foreclosure and sheriff's sale simply because they cannot handle the workload. Homeowners trying to digest losing their home because the lender was too busy, then wrote them off, will probably not sit well.

If you find yourself in the situation where you need to speak, or negotiate a solution with your lender, it may pay to seek professional assistance from a lawyer or real estate professional. Agents or lawyers specializing in lender negotiations, traditionally have a specific individual, and their contact information, for most lenders. Having this existing relationship helps cut through the backlog and allows them to speak directly with a decision maker.

Frank Wible from REMAX All Pros in Turnersville, NJ is a nationwide foreclosure, short sale and real estate market authority. If you have any questions, Frank can be reached directly by emailing fwible@remax.net or calling his office at (856) 228-7990 Ext 150.  Additional information is available at http://www.shortsalenj.com/.

- Courier-Post Newspaper
- USA Today
Weekend of 1-11-08

FRANK WIBLE-- Friday night, and I sit here thinking of the many appointments I have tomorrow. Most entries on my calendar are listings that will probably require a short sale. I wonder how much more I want to do. I don't mind hard work, but this is getting out of control. Countless short sales under contract in full blown negotiations, 60+ additional active short sale listings, and my phone NEVER stops ringing off the wall. Can't miss a single one...it could be a lender!

I don't mind hard work, but the lenders are sucking the life out of me. I've been doing this a while folks and have great contacts at these lenders. Even with that special direct line to the right people, it does not help as much as I'd like.

As you prepare your short sale package with a smile, you're proud that you obtained a great offer for this lender (just shy of full market value). Quickly and without reason they come back with a counter offer. Thank God you hit the mute button before you say out-load what they can do with their counter offer! As your jaw drops, you start to believe every negotiator makes their own rules as they go along. No consistency even throughout the same lender.  The last one you sold for 70% of market value gets a quick approval and settlement. The one you're working now with the counteroffer, they want more than principal balance on the damn loan! It drives you crazy! I can read client financials quickly, understand the mortgage backed securities market, mortgage insurance criteria and underwriting data, completely understand lender guidelines and market valuations, work with, and make recommendations on proposed profit and loss statements, and can do borrower credit based analyses quickly. Plus, I can negotiate better than most! None of this matters. Lender negotiations seems to be an event without rules. 

Weeks, sometimes months later, buyer agents have given up and now have their buyers contacting you directly for updates, and openly share stories on how they will soon be homeless if you don't get them an answer soon. Your seller is sitting in the kitchen contemplating taking the cyanide pills sitting in the downstairs bathroom. You on the other hand, come home, kick the dog and look through the medicine cabinet for the Ambien (sleeping pills) so you even stand a chance of sleeping tonight. You begin to realize you're not getting paid a psychiatrists salary, yet you have become one on many levels. It all starts to hit you.

Soon the idea of getting back to traditional real estate looks as good as that brownie loaded with vanilla ice cream and chocolate syrup you just ate; as you stress eat yourself into pants 4 sizes larger than you wore when you decided short sales where a good idea!

Tomorrow you wake up and make the call to the same lender once again. You stress, you worry, you feel burnt, but you put your best game on, and have your argument ready based on real factual data. On hold for 2 hrs this time, which is sadly not as bad as past calls, but you start self reflecting during the elevator on-hold music, and begin to think the whole world has gone mad (including you). Your phone has been beeping like crazy with call waiting and clients screaming, but you can't answer in fear of missing the slippery and evasive representative on your case. The loss mitigator finally answers, reads the standard "this call will be recorded speech", AND RIGHT OUT OF THE GATE  CUTS YOUR COMMISSION!  You quickly reach for another brownie!

This story, although extreme, is probably the sentiment of most short sale agents. It's not for the weak at heart and it may cost you your sanity before you see the closing table. This is me venting after a long day, but unfortunately bears so many truths.

As I sit here, I can only say this; if your goal is to make money in the short sale business, and your heart is not into helping the client, you will not make it!  It takes heart, integrity, and a true concern for your client for you to last. It's the only thing that keeps your beat up, tired body going and your mind focused. If you're in the short sale business because you're chasing the money only, get out while you can.

Best of luck to all short sale agents as we move forward and "Save a nation of homes...one at a time."

Frank Wible
REMAX ALL PROS
ShortSaleNJ.com

As we all navigate the short sale waters we realize no matter how much training we think we may have, something new seems to arise on every deal. Not because things are different in the methods, they always remain the same, but because the lenders change the rules all the time. The month of January, my team was able to produce 43 short sale closings, and get them to the table! (Yay me!) Each and every one has recently become a gladiator fight to the end.

A simple realization I've had, and have taught to my negotiators, is that the lenders need us more then we need them. Take a hard stance against all the bull crap the lenders dish out, and it will pay off.

I remember one pushy negotiator kept saying "FINE, can I close the file then!" I found myself backing up just to get the deal done for my sellers. I took on this case, because my negotiators could not handle this woman. Finally after being nice and getting my head pounded by this woman, I said "Then close the dam file! The sellers are going bankrupt! You and your investors can have the dam property back. Let your supervisor know that it was your arrogance that made this deal fall apart" and slammed the phone down on her.  She did call back (in about 15 minutes), and we closed the deal with our terms. Wow, it worked!

I can't say that this will work with every deal, but negotiate as if you have nothing to lose. It's not your house, or your loan, or your money. It's in this mindset where you can represent your sellers best.  You should always remember to push extra hard and not give in. Don't forget this!

•1.)    Who do they think they are to cut commissions? Negotiate for this! You work ten times harder on a short sale, so why should we be paid less. Fight for this commission. If you have to, take all listings at 8% and start there. Don't let them push you around on this issue. They will break when you push!

•2.)    Be pleasant but firm, act as if you're the market expert and they need to listen to you. You know values and fight for your case. Tell them you like working with them, and will they continue being the negotiator when the sellers go bankrupt if a deal is not be obtained soon. Befriend them without being their friend.  A fast NO, is better than a slow NO! If you don't see it happening, don't bend just to close the deal! (Within reason!) Get it back on the market (time permitting) and quickly get another offer...and most important; another negotiator!

•3.)    Promissory notes are bad! Lenders seem to be pushing for this much more. With a true hardship, ask the lender how they calculated the formula on how the seller can pay this note. Predicted answer is "they have extra money at the end of each month according to their financial workout sheet." You NEVER give an answer at this point. You will get back to them after you speak to the seller, and breath heavy like this is going to be a major problem. The next day, fax or email the negotiator that the seller said "no way!" Add your own comments like, "Sorry this deal does not look promising, and hopefully your REO department will be able to recover that additional money for your investors. However, in this seriously declining market area, another write off, on a much greater loss may be better for the holding investor. Buyers are extremely scarce in this area, but I will see what I can do for you. Mitigation has not been achieved."

•4.)    A trend I have noticed as negotiators have given up the secrets. "Frank, we would have accepted less on the second if the first was taking a hit as well." WHAT??? Use the fact that lenders are struggling to find a solution to this landslide. Holes still remain in their policy and you need to know what they are. Take notes on every deal while on the phone. Enter those notes into a database or address book so you remember what happened last time you faced off against this lender. Knowledge is power!

Short sale classes can teach you the foundational basics when handling a short sale, but they can't teach you how to handle yourself when negotiating (maybe some can). When all that's on your mind is closing the deal and getting your commissions, you will lose. Remember, it's not your problem. Close or not, you are walking from this deal and it will be a fleeting memory in a month or two. Take this attitude and you're providing your sellers the best possible service. Just don't tell them the details of your negotiating skills, it may make them crazy!

Best of luck with your short sale negotiations! Be prepared, be complete, and be firm. You are the rainmakers helping these lenders, never forget this. Get paid, by providing your sellers the best service.

I write what I experience. Your process or methods may be different. If they work then run with it. If you're frustrated and looking for new angels to win the gladiator showdown, then maybe this will help. I try to provide as much data as I can...take it or leave it.

Frank Wible
REMAX ALL PROS
www.ShortSaleNJ.com

Pulling up to a client's home today I noticed it looked vacant. I looked in the door and saw the young husband sitting on a folding chair watching TV. I knocked and he quickly answered.  A very nice family came running after him and I made my standard small talk. This was their first home and they were very happy to be living in such a nice neighborhood on their budget. 

As time passed, I learned that they signed an exotic loan to buy the home. The mortgage company convinced them they could afford the home of their dreams at a payment they could afford. I think he forgot to disclose the teeth on this loan!

The house looked like they were moving out. So I asked the client where they were moving to.  He replied, oh we do not know yet. I questioned why the house looked empty. The next statement is what shocked me. "The mortgage collections representative told them that they took the loan, and they should be responsible and sell their stuff in order to make the payments or they will be forced onto the streets through foreclosure." This house was cleaned out!

I don't blame mortgage companies, Realtors or anyone else for people not reading the small print.  If they don't, this is what can happen. Anyone can hire a lawyer for a few hundred bucks before they sign on the dotted line for a loan or home. I'm not even upset about what the collections department told these people to do (sell their stuff).  I only type this story to illustrate the casualties of this market are real people that need our help, education and compassion. We're all suffering from this difficult market, but let's be thankful for what we have.

At the very least, a bad day on Wall Street has a definitive end; the sound of the closing bell. After a full day watching the stock market drop, we take comfort in knowing tomorrow it may rally back.  When can we expect someone to ring this closing bell on the real estate market? How much worse will it get?

The past year has been the most painful in decades for residential real estate, as foreclosures increase, and defaults continue to rise on less-creditworthy borrowers creating a broader credit squeeze. House prices fell, home ownership dropped, foreclosures soared, and the housing market emerged as the entire basis of our economy.

Unfortunately, relief from these housing woes is unlikely anytime soon. Daniel Mudd, chief executive of government-sponsored mortgage investor Fannie Mae, expects prices to continue on this decline as foreclosures rise in 2008, possibly well into 2009. RealtyTrac®, the leading online marketplace for foreclosure data, released its October 2007 U.S. Foreclosure Market Report, which shows a total of 224,451 foreclosure filings nationwide.  House prices tumbled in 2007; 6.5% as of October, while an additional 3,711 New Jersey foreclosure have been filed this month alone.  

As bargain seekers line up to purchase their new home or investment property, finding a lender to approve their loan has become a real challenge. Metaphorically speaking, ringing the closing bell for real estate professionals has a whole different meaning.  Buyers not willing to commit, or last minute mortgage guideline changes, makes every closing a challenge.  It's become a nail bitter until the final closing day for all parties involved in the transaction.

Federal Housing Authority (FHA) backed loans may be the only light at the end of this dark tunnel. FHA reform reached an important milestone recently when the U.S. Senate overwhelmingly approved its version of the legislation, the bill passed by a vote of 93-1.

The new FHA reform will raise the limit on FHA loans to at least $417,000. Some areas of the country will see an increase go as high as $829,750. This FHA increase will help people countrywide who are facing foreclosure refinance under these new terms, and help many new home buyers obtain lower interest loans, with less money down (as low as 1%). However, the biggest stumbling block to a compromise is a feature of the House bill which establishes a new housing trust fund for troubled borrowers and would require FHA to contribute to it.

Experts predict a bottom to the housing market sometime in 2009, but only if the economy stays relatively strong. If it slides into broad-based recession, it won't be until the end of the decade that the housing market finds a bottom.

Frank Wible from REMAX All Pros in Turnersville, NJ is a nationwide foreclosure, short sale and real estate market authority. If you have any questions, Frank can be reached directly by emailing fwible@remax.net or calling his office at (856) 228-7990 Ext 150.  Additional information is available at www.ShortSaleNJ.com.