Scottsdale, Arizona

On Thursday, the Professional Realty Council (PRC) launched PRC Access Realty, based in Scottsdale, AZ.  Since 2006, PRC has been building a national network of background and credential checked agents that is expected to hit 30,000 members strong in a few short years.  That equates to about 1 agent per every 5,000 households in the United States.  The relative exclusivity positions PRC's member agents in a way that they can separate themselves from their competitors in the markets that they serve.  Only PRC Council Members can offer PRC's "National Benefits for the Local Move", a managed benefits package normally reserved for national corporate transferees.  To learn more visit:  www.PRCStandards.net

With PRC Access Realty, PRC created a business model which is opening up new opportunities for brokers and agents.  Independent brokers who want all of the benefits of a national franchise can license an office edition package for a fraction of the high costs associated with a national franchise.  Agents who want to align themselves with PRC's consumer-friendly brand now have the option of joining one of the office edition brokerages (like PRC Access Realty in the Phoenix Metro Area) and can enjoy the benefits without paying the traditional high desk fees or splits of national franchises.

Professional Realty Council CEO Stephen O'Hara flew into Phoenix from PRC headquarters in Newport Beach, CA to dedicate the launch of PRC Access Realty on Thursday.  Below are some of the pictures commemorating the ceremony:

So, you have a Profile set-up on Facebook and you've become Friends with many of your old classmates, family, closest friends and a few colleagues.  You may have even learned how to leverage your current or recent client's Friend Lists to tap into their Sphere-of-Influence (SOI) to expand your own.  (See Turn Facebook Into A Prospecting Machine )  Now you might be wondering what do you need to say to turn all of these people into clients without boring or offending them?  The long and short answer is to BE YOURSELF, and this is going to naturally vary for each person.

First and foremost you need to keep in mind that Social Media is best served for SOCIAL relationship building.  It IS NOT a business advertising platform, but if you play the game by the 'rules', Social Media can be much more effective than the most expensive advertisement.  Since 74% of your business will on average come from your SOI, we at the Professional Realty Council (PRC) specialize in helping our selected member agents build their SOI in cost effective ways that positions them as the GO TO person for real estate related services in their market area.  We feel that Social Media is the most effective means of communicating and networking in real time on a large scale.  Yes, nothing beats person-to-person contact, but your time limits will prevent you from reaching enough people to be highly effective from a MARKETING standpoint.  (To learn more about PRC, please visit www.PRCStandards.net )

With this in mind, let's get back to what content you will provide.  Through our surveys of top agents participating in Social Media, we have found that the 80%-20% rule applies.  You will want about 80% of your contact to be personal and social, and about 20% to be business related, or roughly 4 out of 5 posts should have nothing to do with the fact that you are a REALTOR.  The 80% should be about you, your family, your hopes, your dreams, your hobbies, and within reason your political and religious views.  BE YOURSELF, and DO NOT be afraid to be POLARIZING.  If you try to be everything to everybody, you are going to come across as being dull and forgettable.  If you want to keep your life private, then Social Media probably isn't for you.  You may also want to re-think sales as your career choice.  People want to be in your Social Network because you add character, intelligence, humor and value to the collective stream of social consciousness.  If you have strong political or religious views, so long as you do not personally attack someone with differing views, you will gain Friends and Followers who share those views.  Yes, you may lose some of those who do not share the same beliefs, but the net gain of passionate followers will always outweigh the losses.  BE YOURSELF, comment on what is happening in your community, or with your children, or grandchildren, or charities, or on what is in the news.  BE ORIGINAL.  While it's okay to on occasion copy someone else's post (with credit being given), don't make it a habit.  Attach photos to your albums or Flickr account, and/or videos from YouTube.  Use your smart phone to upload status updates and content as you participate:  meetings, sporting events, visits to exciting places, gatherings with friends, etc.  The idea is to let people know who the REAL YOU is.  Trust me, you will attract the like-minded people that you'll want to become better acquainted with.

The other most important thing to do is PARTICIPATE in what others on your Live Feed are saying and doing.  On Facebook it is very easy to add a comment after someone's Status Update to engage them in conversation.  Be positive and supportive.  Be likable.  Ask lot's of open-ended questions.  Your comments will not only be seen by the person who wrote the original comment, but by their ENTIRE Friend List.  You can also send private messages to get to know someone better or comment on more sensative postings.  Show that YOU CARE about them.  Respond to comments that Friends add to your posts.  You want to keep the conversations moving forward.  Even if only a few people are involved in the conversation, many others will be reading the back-and-forth.

For the other 20% you want to just mix in enough content about your business to gently remind people that you are a professional and the GO TO resource for real estate information in your area.  Talk about how you helped a recent client, post links to newsworthy articles about the real estate market in your area, share classes, seminars or other educational opportunities that you've had or offer.  Talk about why a new listing is special or why you enjoy working with the client.  Remember, the idea is not to sell a house today, but to build long-term relationships where people in your SOI trust you enough to call you WHEN they have a need for your services.  This is no different than how you've positioned yourself to your SOI in the past, just with Social Media you are now able to leverage relationships much faster, in greater depth, and for FREE.  My only caution is that you manage your time wisely so that you don't spend too much time in this one area of marketing.

I'd love to hear what Social Media prospecting techniques have worked for you.  In my next installment I'll talk about using Twitter and Facebook in conjunction with your personal blog to reach an even wider audience.

Dennis Rosvall is the Broker/Owner or PRC Access Realty in Scottsdale, Arizona and can be reached at www.Facebook.com/DennisRosvall or www.Twitter.com/UberRealtyGuy

If you are one of the 10's of thousands of REALTORS to already create a Facebook profile, you may be enjoying networking with your old high school friends, family and industry colleagues.  Facebook can be addictingly fun, and can take up an enormous amount of time in your day if you let it, but is it working for you as a prospecting tool?  Are you making money from the time that you invest 'playing' on Facebook.

Since NAR studies show that 74% of an agent's business will on average come from there sphere-of-influence (SOI), we at the Professional Realty Council (PRC) teach our agents ways to increase their personal (SOI) and mine it for more profitable business opportunities.  One of our methods is to maximize Social Media as a prospecting tool.  There are many things that you can do with Social Media, but here is one of the easiest ways to turn Facebook into a zero cost yet highly profitable money machine:

First, ask all of your clients in your initial interview what social media they participate in and how often.  This should become as automatic as getting their cell phone number and email address - it's that important!  For this example, let's assume that they are on Facebook.  You need to sell the next line, but sound excited and let them know that you are big on Facebook and ask if it would be okay to send them a Friend Request.  They'll say sure and now you are on your way.

You might wonder what the big deal is since they are ALREADY your client, right?  Well, here's the magic.  Think of Facebook as a Rolodex on steroids.  If you use any kind of address book, either on paper, Outlook, or Top Producer, etc., the address book is a static file that you use to look up information.  You also need to update it with changes as they occur (Plaxo members excluded.)  Also, it's a linear relationship between you and your contact, and is only of value if you reach out and make a connection via phone, snail mail, email, or in person.  Facebook, on the other hand, is an ACTIVE address book.  It automatically updates contact info in real time, you get a constant stream of everything that is being shared as important to your contacts, AND you get exponential access to all of the people that are important in THEIR lives.  All at your fingertips.  All for FREE.

Your second step then becomes once your Friend Request is accepted, you can view their entire Friend list (Depending on individual privacy settings, you may have access to this without even Friending them.)  When you are actively working with a client, or just completed a transaction, your relationship will be at it's highest point with your client.  Now is the best time to send a Friend Request to all of their friends.  You can do this with or without permission from your client, and with or without a personal message attached to the Friend Request.  It's important here to NOT sound like a REALTOR or salesperson, but rather just a friend wanting to network.

For each request you send, one of three things will happen: 1) They will see that you have a mutual friend and just accept you, 2) They will ignore you, or 3) They will contact your client to see if you are a good person to Friend with.  Of course, your client LOVES you right about now so they'll only say good things about you.  Also, the more of their friends that accept your request, the more mutual friends will be displayed - creating a bigger bond of trust as mutual friends are regarded as personal endorsements.

You can see how this can quickly and exponentially build your SOI by leveraging the goodwill that you have with your current clients.  The larger your Friend List, the more opportunities that you will have to receive warm leads.  In another blog post, we'll talk about content to drip on them via your Status Updates/Live Feed that will build your reputation as the GO TO resource for real estate in your community.

How many times have you heard stories like this:  A neighborhood in Anytown, USA is being served by one or more veteran REALTORS who really know the community and market place.  They might be with a recognized brand, have a sterling track record and they leave a flag at the end of your walkway each July 4th.  They serve their customers well because they are knowledgeable and offer value because of it.  Then, along comes the new guy.  Blankets the neighborhood with glossy postcards, billboards and Open House signs.  Within a few months his listings start popping up all over and before long is beating the veterans head-to-head on listing appointments.  By the way, this agent just got their license and has yet to actually close a transaction.

So, how does this happen?  Why would a seller trust their business to a new and potentially negligent agent versus using an established veteran?  The answer folks, and I hate to be the messenger to point out the obvious - is that to buyers and sellers, ALL REALTORS LOOK AND SOUND THE SAME!

I am not talking about your sphere-of-influence - I know that your Mom loves you.  I am talking about attracting clients that you DO NOT already know.  Consider this:  You are a veteran agent with 10 years in the business.  You're competitor just got their license last month.  You both work for a national brand and have professional signs, business cards and stationery.  You both belong to the same Board and MLS.  You both use the same forms.  You both put your listings all over the internet.  You both drive nice cars and look professional and speak well.  So, the question in the clients minds is who to choose - and they can't tell the difference.  They think you are both EQUALLY good and they will thus choose based on either the lowest commission or who they liked the best.  This is REAL folks, and it happens everyday all over the country.  So, how do you as a veteran agent win this battle?

This is where Professional Realty Council (PRC) comes to the rescue.  PRC is building the first nationwide network of 30,000 agents that have all been backgound and credential checked, plus meet three year minimums of living and working in the communities they serve.

In the corporate relocation world - a $32 Billion Industry that represent over 800,000 transferees each year - there is a growing demand for all representatives working with corporate transferees to be background checked.  In our litigious society, there are increased liability concerns that presents exposure to the corporate employer should negligence or, even worse, criminal activity take place against an employee during their move.  It won't take long for this liability to penetrate the way REALTORS do business in their local marketplaces.  In some cases, it unfortunately already has.  REALTORS who join the PRC Network have passed their background and credential check, so they can proudly demonstrate that benefit to buyers and sellers when interviewing for their business.  Since it's a third party validation, it holds much more weight with the consumer than simply offering a resume.  It's often the slight edge that is needed to establish trust and win the business.

Any REALTOR that meets PRC's standards can apply for membership, and if selected, can use the PRC brand to endorse their qualifications, build their sphere-of-influence and increase their market share.  Broker/Owners can also license an Office Edition to back all of their qualifying agents.  To find out more, you may visit www.PRCStandards.net.

At PRC, we like to say "You can hire any agent and take your chances, or hire a PRC Council Member and Buy or Sell with Confidence."

What is the purpose of creating a brand?  Maybe a better question is what would happen in our modern economy if brands didn't exist?  That is, what if all products and services simply were called by their generic name?  Kleenex was Tissue.  Pepsi was Cola Drink.  Ritz-Carlton was Hotel.  Big Mac was Hamburger Sandwich.  In all of these cases, from a consumer's perspective there would be no differentiation from one product to another in their respective product categories.  Even if one product offering was far superior to its competitors, there would be no way for the consumers to identify which product it was simply by looking at the package.  And thus, the function of branding is to help with the point-of-purchase decision making process of the consumer.

The branding of a product or service is created by utilizing marketing, advertising and public relations to convey a higher value of one product over another to the product's target market.  The more skilled and diligent these disciplines are consistently applied over time, the better the brand awareness for the product or service becomes.  So, as the producer of a product or provider of a service, the purpose of branding is to create a perceived value in the minds of consumers that will make them think of and purchase your product or service instead of that of a competitor.  When product or service offerings are plentiful and perceived to be nearly identical by consumers, then using branding to win this battle in the minds of consumers becomes critical.

To illustrate how this works, here are some examples:

Q.  What is Domino's Pizza's BRAND?

A.  If you said the red, white & blue Domino's pizza box, you'd be wrong.  That is part of their MARKETING IMAGE, but not the BRAND.  For that you need to look at the value to the consumer.  What is their need that Domino's fulfills?  The answer is that your family is hungry and you don't have time to cook.  So, Domino's promises to feed them in under 30-minutes.  THAT is their BRAND!  Remember "Delivered to your door in under 30-minutes, or it's FREE"?

Here's a another:

Q.  What is LensCrafter's Brand?

A.  If you said "Eye glasses in about an hour", you'd be correct!  See, you're catching on.

How about:

Q:  What is McDonald's Brand?

A.  You may have thought of a few negative opinions of their menu offerings, but in the end you'll agree that their brand is a fast and consistent meal that meets your expectations anywhere you go in the world.  Yes, that's a little tougher, but they have made more people into millionaires than any other company based on the brand of offering consistency.

Now, let's apply all of this to real estate:

Q:  What is Realty Executives' Brand?

A.  Hmmmmmm?  You know, I'm not really sure, either.  I don't mean to be coy, nor disrespect the fine agents at Realty Executives, but I've been in this business for 15 years and I can honestly say that I don't have a clue what their value proposition to the public is.

Q.  Coldwell Banker's?  Century 21's?  Keller Williams'?  Prudential's?

A.  Again, I don't really know.  If a buyer wants to buy a home, or a seller wants to sell a home, what is it about any of these brands that connects with the consumer to make one stand out over another?

How about this one:

Q. What is RE/MAX's brand?

A.  Ah, you say, THE BALLOON!  One of the most recognized logos in the world.  Great answer, but wrong again.  The famous balloon logo is also a MARKETING IMAGE, not a BRAND.

Well, what about "Above the Crowd", or "Outstanding Agents, Outstanding Results" you say?  Aren't they all part of the brand?  The answer is yes and no.  RE/MAX has a lot of great agents, but so do the other brands that I mentioned above.  They also have a lot of them.  If you are an agent in any medium to large city, there could be hundreds or even thousands of great agents working at these companies and they are all fighting over the same market share.  Even if a consumer believes that RE/MAX has "Outstanding Agents", as one of their agents you could still find yourself in competition with hundreds of your own colleagues.  In the consumer's mind, they still don't know who to hire because all agents sound the same.  They all are claiming to be #1.  Somewhere the RE/MAX brand became more about the agents themselves than the consumers they serve.  The very name stems from "REal estate MAXimums" which stands for maximizing an agent's commissions and nothing to do with the consumer, so it really doesn't address the need of helping the consumer in the point-of-purchase decision making process.

So, as an agent, how do you create a perceived value in the minds of consumers that will make them think of and purchase your service instead of that of a competitor?  How do you use a brand to stand out from your competition?

Is the answer in the red hat that you wear?  The Hummer that you drive?  The family pooch in your photo?  The pumpkins and flags that you give your farm area on the holidays?  None of that is a brand; it's a personal image.  Confusing a BRAND with a PERSONAL IMAGE is the single biggest mistake that agents make in their marketing.  Advertising a personal image will create a memory in a target market.  Advertising a brand will connect at a deeper level with your target market because the brand fulfills a need.  A successful brand will win the battle in a consumer's mind every time over a personal image.

Where the big companies mentioned above have missed the mark, a national upstart company out of Newport Beach, CA seems to have gotten this right.  The Professional Realty Council (PRC) gives its network of PRC Council Members a consumer-centric brand to secure a place in the minds of buyers and sellers.  You may have not heard of PRC, but you will soon.  They are the first company on a national level to require background and credential checks of all of their agents.  Consumers have a natural distrust of real estate agents because as I demonstrated above, they can't tell the difference between them.  Often it's too late when they realize that the agent they hired is inexperienced or negligent.  PRC solves this problem by only accepting applications of REALTORS who pass their minimum required standards, pass a background check, and have significant area and industry knowledge.  Their brand reflects that "You can hire any agent and take your chances, or hire a PRC Council Member and buy or sell with confidence."  This brand resonates with a consumer because it meets a need:  they want a qualified agent that they can trust.

In this economy, consumers also want to know that they are getting a good value.  Home builders and relocation companies for many years have offered incentive packages to their buyers and sellers if they use their preferred vendors.  The transactional savings these 'managed accounts' create are passed along to the consumer in the form of a benefit package.  Because PRC offers a similar benefits package to its nationally relocating clients, every agent in their network is able to offer the same "National Benefits for the Local Move" to all of their local clients - even if they are simply moving across the street.  Again, a need of a consumer is fulfilled by the PRC brand.  This creates value and demand for the services of their member agents.

The Gallup Poll conducted a study for the Better Business Bureau in April 2008 of what consumers want from a business they buy from.  The top four answers were:

72% - Deliver on their promise

70% - Stand behind their advertising

67% - Increased Disclosure

66% - Certify products are inspected and safe

PRC realized that there is a natural hesitancy for buyers to make an offer on a home that they know very little about.  They are suspicious of the seller and fear the unknown condition of the home.  This is often reflected in low offers, difficult negotiations, extensive and costly repair requests, and often lower net proceeds to the sellers and lower net commissions to the agents involved in the transactions.  Therefore, PRC offers consumers the PRC Certified Home that pre-inspects and warrants their Council Member's listings prior to placing them on the market.  A buyer can purchase a typical home and take their chances, or buy a PRC Certified Home and enjoy piece of mind.  Again, the PRC brand fulfills a need of the consumer and leads to a happier transaction for everyone involved.

Lastly, because PRC only certifies enough agents to serve their market areas, there is virtually never competition between agents.  In fact, PRC only allows 1 agent to be certified per 5,000 households.  This works out to about 1 per zip code, or about 30,000 agents nationwide.  Again, by keeping the supply of agents exclusive to their communities, they each experience higher demand and enjoy greater market share.

It is very difficult and expensive for a single agent to create this kind of consumer-centric brand on their own.  Yes, they can get a background check and offer incentives on their own.  They can even pre-inspect a home.  However, they lack the story and 3rd-party credibility that a national company like PRC can use to substantiate value and trust in the minds of consumers.  It's not just about what services you offer, but the perceived value that will make a buyer or seller think of and purchase your services instead of that of a competitor.  PRC acts as an advocate of the consumer, therefore their endorsement helps their certified member agents stand apart from their competitors and gain market share in the communities they serve.

For more information about PRC, please visit www.PRCStandards.net

PRC Access Realty comes to the Valley of the Sun!

After 15 years helping buyers and sellers with their real estate needs in the Valley of the Sun, I am venturing out to launch my own company on December 1, 2009 - based right here in Arcadia, Arizona.  As a licensee of the Professional Realty Council® (PRC®), I am opening my own office as broker/owner based on their consumer friendly national brand.  Since PRC's brand is consumer driven with strong demand, I am currently looking for top agents who want to share in the opportunity to offer PRC's value added services.

This is a venture that has been in the works for sometime.  I have spent the past 5 years of my RE/MAX Hall of Fame career helping develop the PRC® national brand.  My partners and I working in several states have built a model based on the latest trends in marketing and real estate, creating a consumer-centric "Network of Standards®" among experienced real estate professionals.  See www.PRCStandards.net.

Our agents at PRC Access Realty will be able to offer buyers and sellers our unique brand of "National Benefits for the Local Move^TM" that can only be offered to PRC Private Clients®, including the benefit that all of our agents have passed a Background and Credentials Check by a third party.  PRC screens each licensee to insure that they are true professionals that meet or exceed their national standards.  At PRC, we like to say "You can use any REALTOR and take your chances, or you can hire a PRC Certified Agent and Buy or Sell with Confidence."

So, look for the PRC Red Tag logo out front.  You'll know the homeowners made a wise choice - you can, too!

Dennis Rosvall

I saw an article on MSNBC this morning about a British guy who won the "Greatest Job in the World" - to get paid $110,000 to spend six months on the Great Barrier Reef in Australia not doing much more than blogging about his adventures as caretaker for the reef's islands.  I don't know about you, but that would combine my two loves and be my greatest job to have, too.  I've been to the Great Barrier Reef three times and I could easily spend the rest of my life there.  I'm also obviously addicted to social media, so it's a natural fit.

So, this got me thinking:  Who has the greatest job in Arizona?

We have such a rich and diverse state full of beauty and history, from the Grand Canyon to Tombstone, that there must be somebody who has the ultimate and most envied job?  Is it someone associated with one of our many sports franchises? (Where are you @DbacksPRGirl?)  Maybe a Park Ranger on the Rim, or maybe a maitre d' at one of our highly rated restaurants?  There are certainly some great jobs to have in Arizona.

I'd like to hear your nominations.  You can nominate yourself, a friend that you're envious of, someone who may be a local celebrity, or just a job that you know exists even if you don't know who holds it.

This should be a lot of fun, and at the end of the month I will select the winner of "The Greatest Job in Arizona!"

I will never profess to be a bona fide techie or even an advanced user of popular software or hardware.  I am, however, at age 40, of the generation that grew up as technology grew up.  I had my fist Commodore VIC-20 in Jr. High, and a Commodore 64 in college.  I witnessed the birth of fax machines, laser printers, and cell phones.  I began my real estate career in 1995 right as the Internet was gaining popular acceptance.  I witnessed the dot com boom and bust, the land grab for domain names, and the cultural game changer inthe iPod.

While I grew up with technology, I wasn't always on the cutting edge of it.  I had email and web access with the old AOL dial-up service in 1995, but don't think I owned a CD player until the late 90's.  I was taking digital photos in 1997, but have yet to own an iPod (I think my daughter has three!)  I've been using a BlackBerry for most of the decade, but just got our first Nintendo Wii last week (I won it in a drawing to my kids delight!)  I've had a plasma HDTV hanging on my wall since '05 with a DVR, but have never rented a movie from Netflix or bought On-Demand, preferring instead to trek to Hollywood Video or RedBox.

I say all of this to build a framework for what this post is really about.  I don't know how to create technology, and I may let some trends slip by unnoticed, but I do latch on to others when I see a potential to reshape the world.  Web 2.0, while frighteningly young, is something to stand up and take notice of.

I only learned of blogging about 3 years ago and didn't begin my own until I started this space early last year.  While I realize to some that that delay may seem to be an eternity, the surface has really only been scratched on the extent that blogs will eventually penetrate all levels of society.  Blogging was really the beginning of social media as we know it today.  MySpace took it a bit farther, followed by Facebook, LinkedIn, etc.  There are dozens of social media sites out there that now allow anybody to share their thoughts, hopes and dreams with the world in every digital media platform.  Twitter has emerged as the glue that ties the rest together with it's unique ability to rapidly grow a distribution list.  Words, graphics, pictures, music and video have been incorporated into all of the major social sites, and while the younger generations were the first to jump on the bandwagon, businesses and professionals are only now starting to see the potential of this emerging technology.  This is why I predict that all hell is about to break loose.

As business starts to realize the potential of being in front of countless thousands of "friends", "fans" or "followers", money is going to start getting dumped into commercial side of social media in exceedingly increasing rates.  Hundreds of social media companies will be born and some that may not even exist today could be Fortune 500 candidates just a few years from now.  Just like during the dot com run, we will see venture capital poor in once a profitable and sustainable business model emerges - and it won't be long.

As society becomes more tolerant to social transparency, more and more people will be sharing themselves more openly in the digital world.  Advertisers will be able to focus their ads only to those who have expressed interests in their goods and services.  Entertainment will be focused even tighter on market segments with digital delivery of content to the device of a consumers choice.  The very way we communicate with others will blur as technologies continue to consolidate.

The company that has been noticeably absent from this conversation is Microsoft.  Have they missed the boat and will they be over-taken by a start-up with a new angle and hip following?  Don't count on it.  While I've never been a big fan of Windows, I think the Office suite of programs sets the world standard.  It won't be long before Outlook transforms into a social media tool with unparalleled power.  Just think about this:  You have an MS Exchange enabled version of Outlook on all of your devices.  On your desktop you have an MS version of a Facebook-like wall showing current updates of everyone of your connected friends.  When you open a contact window, a full stream of their recent posts is displayed, complete with video uploaded from their cell phone or Flip Video, and a history of every communication that you've had with them - including voice transcripts of your phone calls.  You type out a blog post and it automatically sends to the desktop of the distribution list of your choice.  Key words are all interactive, calendar items are scheduled automatically and contacts update instantly.

Plaxo and new products like redPear's Core Relationship Manager touch on some of these functions, but once Microsoft wakes up and builds them into Outlook you'll see many social media companies go the way of the Netscape Navigator.  While the big will get bigger, the monetizing of social media will be the catalyst to bring the world out of our current recession and lead us into the next bull market cycle.  Buy stock in any of the companies that have patents on the key technologies.  Trust me, they are bargain priced compared to where they are headed.

If that is not enough, what do you think will happen when Google gets it figured out?

Here's is some information passed along to me from a friend in the mortgage business regarding the Federal Governments new Loan Modification program:

The Obama Administration unveiled the final details of its "Making Home Affordable Program," which is designed to help up to 9 million American families refinance or modify their loans to a payment that is affordable now and into the future.

One of the initiatives in this program is aimed at helping struggling homeowners "modify" their loans to avoid foreclosure. Here are some common Questions and Answers about the Modification Initiative in the program.

MODIFICATION INITIATIVE

Who is eligible?

To apply for a Home Affordable Modification, you must:

• Own and currently occupy a one- to four-unit home.
• Have an unpaid principal balance that is equal to or less than $729,750 (for one unit properties).
• Have a loan that was originated before January 1, 2009.
• Have a mortgage payment (including taxes, insurance, and home owners association dues) that is more than 31% of your gross (pre-tax) monthly income.
• And, have a mortgage payment that is no longer affordable, perhaps because of a significant change in income or expenses.

If you answered YES to all of these questions, you may be eligible for the Modification Initiative.

Am I eligible if I missed some mortgage payments?

Yes. If you missed two or more mortgage payments and answered "yes" to the Modification Initiative requirements above, you may be eligible for a loan modification.

Do I need to be behind on my mortgage payments to be eligible for a Home Affordable Modification?

No. Responsible borrowers who are struggling to remain current on their mortgage payments are eligible if they are at risk of imminent default. Examples of being "at risk" include facing a significant increase in your mortgage payment or a reduction in your income. Contact me to discuss your specific situation.

I have a second mortgage. Am I still eligible?

Yes, but only the first mortgage is eligible for a modification under this specific initiative.  Contact me for details on how to modify your second mortgage.

I have an FHA loan. Can it be modified under this program? Are all loans eligible?

Most conventional loans including prime, subprime, and adjustable loans; loans owned by Fannie Mae and Freddie Mac as well as private lenders; and loans in mortgage backed securities are eligible for a modification. Contact me to discuss your specific situation.

I have a mortgage on a duplex. I live in one unit and rent the other. Will I still be eligible?

Yes. Mortgages on two, three and four unit properties are eligible as long as you live in one unit as your primary residence.

What does the Modification Initiative do?

If you are eligible for this plan and are approved, you will be put on a trial modification for three months at a new interest rate and payment.

If you successfully make the payments and are current at the end of the three-month trial period, your servicer will execute a permanent modification agreement that will lower your interest rate to a fixed rate for five years.

What happens after five years?

Beginning in year six, the rate may increase no more than one percentage point per year until it reaches the "rate cap" in your modification agreement, which is basically the market interest rate on the date the modification is finalized.

That means your rate can never be higher than the market rate on the day your loan is modified. This is great news because rates are currently at historic lows... and you can lock in now.

How low can my interest rate go?

The Treasury is providing incentives to your lender to write the interest down as low as 2%, if necessary to get to a payment that you can afford based on your income.

What happens if that is not enough to get to an affordable payment?

If a 2% interest rate is not enough to bring your payment down to 31% of your gross monthly income, your servicer can extend your payment term--for example, give you a 40-year loan rather than a 30-year.

If that is still not sufficient your servicer will defer repayment on a portion of the amount you owe until a later time. This is called a principal forbearance. A portion of the debt could also be forgiven. This is optional on the part of the investor. There is no requirement for principal forgiveness.

Are there any other benefits to this program?

Yes. For every month you make a payment on time, Treasury will pay an incentive that reduces the principal balance on your loan. Over five years the total principal reduction could add up to $5,000.

How much will a modification cost me?

There is no cost to borrowers for a Home Affordable Modification. You will not be asked for any money by your lender.   However, you may not want to "go it alone."  Please contact me for information on affordable resources designed to assist you with your loan modification.  After all, you only get one chance to do this right.

If there are other costs associated with the modification--such as payment of back taxes--your servicer will add those costs on to the amount you owe. Your servicer will also forgive any late fees.

Is housing counseling required under this program?

Borrowers are strongly encouraged to contact a HUD-approved housing counselor to help them understand all of their financial options and to create a workable budget plan.

However, housing counseling is only required for borrowers whose total monthly debts are very high in relation to their incomes (55% of your gross monthly income).

If you would like to speak to a housing counselor, call 1-888-995-HOPE (4673).

How do I apply for the Modification Initiative?

We have excellent tools available for you to assist you in putting together a Loan Modification request.  Please contact me for details.

My loan is scheduled for foreclosure soon. What should I do?

If your mortgage has been scheduled for foreclosure or if you have missed one or more mortgage payments, should contact your servicer immediately.

You may also want contact a HUD-approved housing counselor by calling 1-888-995-HOPE (4673).

As always, if you have any questions or would like to discuss how this may specifically impact you, I'd be happy to help. Just call or email me any time.

Jon Littlefield, CMPS®

Certified Mortgage Planning Specialist

Cell: 480.703.0512

Fax: 800.954.0780

www.AzLendingAuthority.com

"You're at Home Here"

I've had several of my friends who haven't joined Facebook or Twitter yet contact me recently wondering how Social Media can help them in their business.  Basically, what's the point?  Well, I remember people asking that same question about 12 years ago when the internet was just coming into its own.  Seems a bit silly now, doesn't it?  The best way I can answer the question is this:  The world is changing right before our eyes faster than we can even imagine.  It's become connected and transparent.  I think that most of you can admit that a static Rolodex or address book has been replaced with electronic versions like Outlook, Blackberry, etc.  Now these databases are being replaced with Facebook, Twitter, LinkedIn, MySpace, YouTube, blogs, RSS Feeds, et al.  Basically, Social Media has transformed your address book from a place where you keep your contacts to a place where your contacts keep you. (Damn, that's good - I'll need to post that on Twitter!)

Social Media is an interactive, multi-faceted, global database where everybody can learn and share from everybody else.  You can find your own balance as to how much you want to share or observe.  Don't you think it would be great that if all of your friends and clients shared their greatest successes as they happened and you could congratulate them in real time?  Do you think that would make a powerful impact?  Think they might remember you when it comes time for them to need your services?  And, what about their friends who you have never even met?  Do you think they might wonder who you are and what you do when they see you interacting with their friends?  You bet!  As with most things in life, 90% of success comes from just showing up.

Here's a video by Perry Belcher that explains the point of using Social Media in business better than any others that I have seen.  Thank you to Chris Pollinger of the PRC Network for passing this along.

http://www.facebook.com/ext/share.php?sid=53661224331&h=-TJwY&u=g-LQ4

Also, thank you to the dozens of you who have already joined my Facebook, Twitter and LinkedIn networks.  Much more good stuff to come.

I'm on Facebook and LinkedIn at Dennis Rosvall or DRosvall@prcstandards.net, and Twitter at UberRealtyGuy.  See ya soon!