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The beginning of the end was quite evident....if we listened.

The beginning of the end.

Hi folks. Sometimes I find it hard to believe that we are 3 years into this drastic market decline. I was reading through some of my older articles this morning and found this one written in late 2006.

Real Estate is about people, not money! Part 2

Today I met with another pre-foreclosure Seller. I sure am getting a lot of these lately. Anyway, I spoke with this gentleman yesterday and could tell he was really stressed out. Life had dealt him a bad hand this year, health wise, and he has found himself disabled and unable to make mortgage payments. In fact, he hasn’t made any for 5 months. His wife has just started back to work, so they are now in a position to start making payments, again. So that’s a good thing.

I’m writing this post to bring to your attention “predatory lenders” and how they prey on good people’s misfortunes. First, these folks have no other debt except their house, which has a mortgage balance of approximately $170,000, including missed payments and a prepayment penalty. Fortunately, the Lender has not started foreclosure proceedings and have not tacked on Attorney fees......yet.

When I walked in today, the first thing the Seller started telling me, was how he was working with a different Lender, to see about refinancing his house, to “help” him out and how they should have an answer for him in 3 weeks. With this is mind, he only wanted me to list the house for 3 weeks, if I could sell it before the loan came through then good, if not he would take the loan being offered. Well needless to say this did not appeal to me and my immediate thought was to just give this guy some quick info, politely bail out and leave. But I couldn’t do it. He was very stressed so I decided to get some more info from him and see if I could give him some advice.

Well to start, his house is only worth $245,000 to $250,000 max. It turns out, the lender that is willing to “help”, has told him that he can do a loan for 65% LTV based on an appraisal of $300,000! And will only charge him $10,000 in closing costs. Now if you do the math, it means the Seller will have a new loan balance of $195,000 and after paying closing costs MAY get a check for around $13,000. His current payment of $1,400, that he can’t afford, will go up to $1,500 (this is what the lender told him). Now what is wrong with this picture? Well first, how can a house appraise at $300,000 that is only worth $250,000 max? FRAUD. How can they quote him a payment of $1,500 on a high interest loan of $195,000? LIAR. How long will this Seller be able to make payments before he is in foreclosure again? SAD.

Now being the good little Realtor that I am, I pointed this stuff out to the Seller. I explained to him that they are ripping him off and if you take them up on their “help” you will be digging your hole deeper. I also explained to him that his current lender does not want to take the house back. I suggested, that if they are now in a position to start making payments, then they need to contact the current lender and negotiate a loan modification. Since he has no other debt and has a legitimate reason for his financial difficulties, there is a better than good chance, that they can work it out and keep their house. I could actually see the glimmer of hope come into their eyes. They have been buried in stress and have been getting letters from “sharks” everyday wanting to “help”. They did not know they had other options. They don’t want to move. They love their house and just want to get beyond the financial hardship.

So folks, it was a great listing appointment! I did give them some info on selling but really do not think they need or want to sell. I told them if things don’t work out with the bank, then give me a call. I will be there for them.

They both walked me out to my car. Mrs. Seller gave me a hug and asked me for a stack of business cards. And Mr. Seller was really excited and pumped, about having another option, instead of selling or refinancing.

Folks, I’ve said it before and I will say it again, “Real Estate it about people, not money” As Realtors and Lenders, we can make a difference in people’s lives. Make it your goal to listen and to give sound advise. I left this listing presentation with my sign in my car and a smile on my face. To me, that’s priceless!

Available Short Sale Training:

Bryant Tutas
Broker/Owner
Tutas Towne Realty, Inc
Licensed Florida Real Estate Broker
http://CentralFloridaShortSales.com

http://ShortSaleSuperStars.com

***The content of this blog is solely my opinion***

SHORT SALE AGENT TRAINING

Posted by Bryant Tutas Broker/REALTOR(R) Tutas Towne Realty, Inc on 08/28/2009 03:51 PM

Comments (79)

Loan Modification in the Home Selling Channel

loan modifications, mortgage fraud

Originally posted at: Selling Poinciana One Property at a Time.: The beginning of the end was quite evident....if we listened.

This post has been included in Florida Information Osceola County, FL Information Celebration, FL Information
Post is included in group: Real Estate Rookie

79 Comments on The beginning of the end was quite evident....if we listened.

AUG

Reserved Parking For "The Lovely Wife"...TLW...ROAR!

Hun...

I don't want it to go to your head, but yeah, you were right.

Whoa did I just say that out loud and type it at the same time? I must be losing my edge :)

TLW...ROAR!

Bryant - you nailed it . . . sign in the car and a smile on your face. Thanks for sharing this with us again.

Well put, Bryant. One of my former co-workers is in a similar situation. They were approached by a company wanting to charge them $1500 for a loan modification. I told her frankly, "You can do this yourself. And if you want, I will even help you do it... for free." Heck, I've helped many people do that for free. It's about people and a little bit of karma along the way.

Bryant, we're 5 years in to it here in Metro Detroit. Just when I think I see signs of it coming around, the train finds a new track to speed on...

On to your point: This industry has always been about people. Always. At times perhaps because of many investors and flippers it hasn't always felt that way,but for those of us who relish spending time with people the bottom line has always been "It's about them."

You get that. The people you encounter and counsel get that about you.

There are still some of us good guys left. All those greedy loan officers are making it harder for people to trust any of us.

Glad to see that they found you.

Bryant, I got a call from a Realtor today who was going to bring an offer on one of my Short Sale listings. She told me I am bringing you one with the price and another one will a right to purchase and the company wants to negotiate it.Also they wanted the offer on "their sales contracts."

Huh?

This is a really good Realtor so I said, "_____what are you doing? this is Fraud."

I went on to tell her about several we had turned down this past year, from "asset managing" companies that were defrauding the mortgage companies, submitting low bids, then flipping them.

She said, "Well, Missy I am glad I called you, I did have a funny feeling about this."

Gee....

One I turned down did get listed by a Realtor in my area. Who has NO CLUE what she is doing. There are always ignorant Realtors and Lenders who prey on their not understanding the process.

Man it's been a long three years at that. I was thinking about this just the other day - where was my head at three years ago and did I have a clue as to how bad it would really get. Nope. I did not. All I can say is I'm glad it's now - and maybe in another 2/3 years we'll get somewhat back to normal.

It's almost 2010 - let's plan ahead!

BB and TLW: It's been a long three years when you look back, has it not! All the fraud and scams and BS that people have gone through. :shaking head: I dream of a return to normalcy! Until then I will smile at every rain jacked post by TLW ;)

I agree! Real estate is about our clients and how best to serve their interests.

kudos to you for doing this man right. it's the sharks in the water that got us in this mess in the first place.

"Real Estate it about people, not money"

Now that's your Grandfather's way of doing business! When it comes to real estate the only protection the consumer has is the personal integrity of his agent, loan or real estate!

"I left this listing presentation with my sign in my car and a smile on my face. To me, that's priceless!"

A man of integrity! Many would have added to the owner's troubles!

Bill

This makes me proud to be a Realtor. I have seen similar stories and it makes me feel great to help someone that is at wits end and falls prey to this scum. Good for you BB!

Bryant, this is the kind of moment that makes this job worth every single headache! Love you for sharing it and pointing out what those of us who LOVE this job know for the edification of everyone who thinks we aren't worth a plugged nickle! Your agent isn't a people person? I think you have the wrong agent!

Amen to that bryant.

This remains my favorite blog photo of yours, with the house with the farm animals grazing in the front yard a verrry close second. We're a year ahead due to your own experiences- thank you for that.

Bryant,

Doesn't it make you feel good when you can help someone. You are a good man and I am wishing you and TLW good karma wherever you go.

You may have said it before... But it sure warrants repeating!

Great post Bryant-- more people should be thinking in this way and actually trying to help other people and not just to exploit them to make a profit.

Hopefully your good karma will come back in the form of many referrals from this couple's friends and family, and from the sounds of it-- it probably will!

Wow, when I read stories of this sort from across the country, it just makes me shake my head. Thankfully, in our area we just don't have that many foreclosures to deal with.

Hi Bryant ~ Good call! It doesn't pay the bills, but it means you sleep easy at night, doesn't it? It's about helping people make a really major decision in their lives. It's never about the money.

Denise

broker bryant I love your posts and you tell it like it is. Thank You!

Bryant - In my opinion if you make it about the people the money will come. I'm sure this couple will refer many many buyers and sellers to you.

This type of loan approach is so common. This is what the sharks used to do all the time. I didn't think there was any of these guys left.

Sigh - whenever I hear this it makes me sick to my stomach. Thank goodness you were there! Even if we can help just one person... ~Rita

BB: You left that listing appoint with something that you can neither buy nor can anyone ever take away from you ~ honesty and dignity based on your knowledge. You are a credit to our profession.

It seems like a great way to do business to me. Your clients may get to keep their home and will happily refer you to everybody they know because they know your looking out for their best interests, not yours.

BB: So how does the story end? Were they able to recover and keep their house?

I'd love to know how it all turned out... Any ideas?

We are in the people business and helping folks accomplish their goals should always be first and foremost in our minds. The money always follows.

Bryant,

Hopefully everything works out right for this couple. Without your timely mortgage advice their situation likely had taken a turn for the worse, much worse.

Bryant, this is a great story. Your integrity shines through in it and your business has been blessed because you choose to do the right thing in situations like this where many would be tempted to just put their house on the market for a paycheck in their pocket - or prey on them for a loan modification fee themselves.

Sharon

Bryant,

I remember with great joy the times in my real estate career when i have been able to help someone in a similar way as this. I helped one couple avoid getting into an options loan with negative amoritization. It is so fulfilling when we can do something so life changing for people.

Bryant,

It is a business that is 100% about people. If you can help someone, then help them. Eventually there will be a payback.

What you did was very worthwhile. I hope one day that it will turn into an investment.

Yeah, good for you Bryant, as a listing agent you done real good. Too bad it is the buyer's agents who helped put alot of folks into homes which they could not afford. O' right, it is not the agent's responsibility to stop someone from buying a home they cannot afford. The buyers will just go down the road to another agent who will help them buy a home they cannot afford so why not make the check (money) instead of letting them go down the road. It has happened more times than real estate agents want to admit.

So, RE Agents had a hand in this whole mess and do not want to admit it.

Without you, Bryant, they might've been devoured by the sharks. Good for you...and them -- and yes, it IS all about helping others.

There will always be unscrupulous people, no matter what the market is like. If you can lie down at night knowing you did your best and acted with integrity, what else is there?

Hi Bryant -- What an incredible story. It saddens me to think of these predatory lenders out there still today. You provided beyond exceptional service and knowledge to this seller. It's amazing how unstructured this industry is and knowing the right people can make all the difference. Congrats!

Wow - ONLY $10,000 - what a great guy!! (puke) Most lenders won't charge that much on a $1,000,000 home.

I can't believe those scum bags were going to take advantage of people who were already in desperate need, but had the ability to get back on their feet! Good for you, for helping them, and pointing them in the right direction!

AUG

Doing the right thing...it feels good...and it's the right thing to do! LOL

To mildly disagree with one post above:

I think your type of behavior does pay the bills.

You could have spent all that day and week trying to come up with and execute some plan to increase your business -- and not have accomplished as much as you did that day by simply doing the right thing.

How powerful is it to have someone say: This REALTOR did/does a good job. ???

How much more powerful is to have someone say: This guy really has his clients interests at heart. ???

Great example of what is all about . . .and these people become fervor advocates for your services . you will win every time.

I hope it works out for them. Although I don't understand how anyone would consider an option that would actually make their payment go up??? Best of luck to them and I'm happy you gave them a reason to believe Realtors aren't all that bad. :)

Chanda panda

Morning BB, Your clients are indeed lucky to have you working for them. Will there be an update on how this couple made out ? Well done !

It will be so nice when all the weeds that were sown are reaped and we no longer have this type of thing.. That's probably not going to be for A WHILE. I'm so glad that these folks had you to help them during that time in their lives. Great post and well worth reposting. Thanks!

BB, anytime you can help people you are doing your job. This is a great example story and I am so glad the people were grateful to you for your counsel as well.

That couple will sing your praises for years to come.

I actually started telling people in Summer 2005 that the party was over. My carpenter sold his house through me in September 2005 and we were having appraisal problems even then - now the house is worth half what he sold it for.

There are still a lot of unsrupulous practices going on out there. I've sat in 2 panel discussions with the Florida Attorney General's office this year, and they flat out tell you that fraud is rampant. They even go so far to give you a long list of all the schemes that they are seeing. It is amazing.

I love this story. Personal satisfaction is much more gratifying than getting a listing. And I believe that by helping people, and dealing with them straighforwardly and honestly will end up bringing more business in the end.

Unfortunately, many members of the public think it IS all about the money when it comes to realtors. Big sigh.

There are so many folks out there who are preying on the misfortunes of others. It's pretty scary, isn't it?

BB - yes indeed it has been a long 3 years in our market as well. I often wonder what our industry would be like if these nefarious types your clients encountered would apply the creative energies they seem to have towards healthy long term solutions, instead of their drive-by shooting practices. You are a great role model for us in building our long-term healthy businesses and we appreciate you sharing your "wealth" knowledge. John

BB - It's so sad how these types crawl out of the woodwork to take advantage of people's misfortunes. Good thing you were there to help -- they will remember you for a long time :)

In 2005 and 2006 I was working with quite a few California investors buying in Oklahoma. They would tell me about therir purchases around the Orlando area, and that they were doing option arms to keep the negative cash flow down. I remembered how negative ams killed Oklahoma after the 1982 oil bust, and I thought this can't be. No matter how hard I tried they did it. Now I am selling their properties here becasue these types of loans in other markets killed their investment portfolio. I am glad you had the keen observation about what was happening then.

i am SO glad you wrote this post. for two days, i have been trying to figure out a way to write a similar post without cursing. i went to my cousin's house the other night and she wanted me to review some documents from a lender before she refinanced her house. her interest rate went down, good thing. her mortgage payment went down, good thing BUT the fees they were charging her were ASTRONOMICAL! i went through them with a fine tooth comb with her and told her to bail. they go to these people who know nothing about mortgages and give them the line "oh, your payments will be cheaper and dont worry about it, you dont need to pay closing costs we'll take care of that" meanwhile, their debt just jumped another 20k! ok im pissed, let me hush my mouth...

"Only $10,000 in closing costs" W0W, that's only part of the problem in this hideous scenario! It's a good thing that there are people like you that can show up and give honest, practical advice based on experience. I am not saying this to blow smoke up your skirt (I've seen you in one) but to say that folks DO need competent help no matter where they live. Your part of the world is better off because of you and like minded professionals who hopefully are the rule and NOT the exception!

The next shoe to drop would be to increase your client's interest rate and fees when the property appraises for $240,000 - $250,000. Of course, this would be the appraiser's fault.....

I'm sure that your kindness and compassion will be repaid - you're in a referral driven business.

Yes, this is a good story for sure. IT really shows what we are all about in real estate.

Kindness and compassion is always rewarded down the road.

Patricia Aulson/portsmouh nh homes

Hi guys, Thanks for all the great comments. You know I really didn't do anything special. I'm sure you would have handled it the same way. Most of us in this buisness are very ethical and willing to help. It's the very few that give us a bad name.

So much has happened since the time I wrote this post and now that I honestly can't remember what happened with these folks and their property. I have been racking my brain but keep drawing a blank. When it does come to me I'll post where they are at now.

I must be getting old!! I have to say that after the difficult year TLW and I had last year with her in and out of the hospital like she was I seem to have lost my memory on a lot of things. I guess stress will do that to you. Oh well....I'll just keep moving forward.

Thanks for stopping by.

BB,

Since we both are in the same state I'm sure you'll agree that there are still a bunch of those bad apples out there...you would think that by now all of them would have sabotaged their own business and ran out of support...Slime I say...good job.

Wonderful blog Bryant - you are right - this business is not just about the money sometimes you really need to just help someone. That is a good thing...

Bryant-

Those of us who understand that this is a business about people first and foremost will remain in this business for a very long time.

BB!

Mini-rant.

Hey! You know I make a lot of money doing what I do. I hope everyone does. One thing I can say is that I NEVER think about my commish, ever. Ever.

I go to the listing appointment to offer my services, if needed, and to do a good job. Our compensation is a REWARD FOR A JOB WELL DONE. We are in a risk/reward industry.

Real estate agents DO NOT understand this concept. We are not entitled to a penny until a closing occurs. Know this, I never take a listing or buyer-client on unless:

1. I can help that person

2. A realistic possibility of a closing can occur.

With this in mind you will NEVER hear me b*tch or complain about an unfaithful client or a listing that doesn't/won't sell. Why? Because it was MY decision to enter into the biz relationship. No one owes me anything. I work for it. I earn it. I don't expect OR demand it; nor do I feel entitled to it.

High-end or not---it's all the same- and your willingness to offer your help without thinking of your own agenda, is, quite honestly, REFRESHING.

If most agents would focus on doing the job (and doing it GREAT)in which they are hired for, their rewards would be incredible.

I'm really over agents who constantly b*tch and complain about clients. I think to myself "you made a conscious choice to work for these people. Your complaining speaks volumes about your abilities, as an agent, rather than the loyalty of your clients, or the salability of their homes."

Rock on.

You must have a big smile on your face ALL the time, now.

You are SO right! Appraisers are SUPPOSED to be working for the "good of the public" as well as the client/lender. Too many poorly trained appraisers are duped into hitting numbers to "help" poor homeowners like this.

But likely, unless it is an FHA deal, they will be ordering from an AMC which would pull an appraiser from WAY too far away who will skew the data one way or the other!

Sad times.....

Right on. Something similar to me happens on almost 50% of my conversations with prospective sellers. Honestly, in this down market there are a lot poeple that would be better off not selling, and I consider it my job to give them other options if I think they should consider them. If that means that there is no listing, then so be it. I have no problmes sleeing at night.

Great post Bryant!

Even though this is a "Retweet", your comment "It's about people" totally applies, always.

I've had a couple of listing presentations lately where I just given people my best assessment of their situation right now. I've told them they weren't ready to sell because selling was a poor option for their circumstances.

And I've received genuine thanks from them, (although no commission). Will they list with me in the future? Who knows, but I think my chances are better than before!

Was it worth it? Yes. What was that movie? => Pay It Forward

Mark Donovan, Surrey BC, Canada

Bryant,

After over 30 years in the business, I still give people a hand. I'm not rich, but I like what I see in the mirror each day. This theory of helping others was taught to me many years ago. "If you do the right thing and care about people, the money will follow".

BB - you definitely have to be a people person. Kevin Tomlinson really said it nicely in his comment.

Shoot from the hip and it will never fail ya.

You must sleep like a baby at night. If we have no conscience how can we claim to have our clients' best interests at heart. I'm with you, I'd much rather tell the truth and not a commission then get a check that was the result of someone else's preventable heartache.

Barb Mihalik Coldwell Banker Sea Coast Realty, Wilmington, NC

You're a good guy Bryant. It always feels good to help them out. These people are lucky to have equity. The Sharks must have smelled the blood in the water. Not many people left to cheat.

AUG

That is the way we should be treating people. Honesty is just too easy to not do business that way.

Hi Broker Bryant, I read the post, did not read all the feedback. I think you are a superbly "good samaritan" to do such a nice thing for someone in dire straits, that was about to get slammed by the mortgage guy! I know the homeowner immensely appreciated your honesty, and we know that you have truly helped these people.. what a nice guy! I bet you sleeep well at night, because of your honesty,integrity and compassion for mankind...Seller is very lucky to have an agent of your caliber.... love reading your blogs!

Thanks for sharing, too many not so happy endings in this market! Good character will always take you to good places in life!!! I have no doubt it did (feel good moment) and will come back to you (being highly recommended and referrals)!

bryan,

good for you for accurately assessing the situation and counseling with the clients best interests in mind.

i would love to hear that these folks took your advice and righted their ship, but my experience tells me that they likely did not. if you have any info on the resolution of the file it would be nice to see. i would imagine most of us here have given very similar advice on many occassions and seen it ignored. especially with the numbers you cite the solution was readily at hand...out here in california the numbers are typically two or three times larger...making the chance of a favorable outcome, all other things equal, very remote.

clients are subjected to immense pressure from many directions and the ability to cut through the BS is one that many never develop.

That's a great story for today and for a couple of years ago. Just had a seller that this just happened to and I explained that refinancing with these bozos was not going to help her one bit. Your clients are lucky to have you in your area. Not everyone with a license is a shark!

Bryant - nice story, no wonder you are so successful. If you put people first in the transaction, it will only help you in the long run - even if it means passing up a few listings or sales along the way.

AUG

Great job Brian. You did the right thing. It is NOT always about the money... but like you said the People

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