I had a conversation with a good friend of mine yesterday who owns a few properties in a small Oregon town. He shared with me a story that is not unlike that of many people who have been devastated by the bubble burst and predatory lending.
He has lived in the same town for most of his life and used the same bank to obtain loans on all of his houses for the past 22 years. For the past five years he has been upside down $600.00 a month on an investment property, never being late or missing a payment. Recently, he visited a "friend" at his bank to discuss the possibility of refinancing this property. He explained to this "friend" that he was literally going broke trying to stay current on the property and that he needed help. After explaining his humbling position, he was told that there was nothing they could do for him. He was told that if he only had more reserves...blah, blah, blah, (If he had more reserves, would he be asking for help?) This "friend" went on to explain to him that if he stopped making payments, they would foreclose on the property, sell it, and then sue him for the difference. This wasn't a surprise to my friend, his wife is a real estate agent and he already knew the foreclosure process. What he didn't expect was the level of callousness that was given to him by someone who has made a decent amount of money from his real estate transactions throughout the years.
Times are tough for a lot of people. Many folks are facing circumstances that they never thought could be possible in their lifetime and they deserve to be treated with respect. Although there are some people who have walked away from their financial obligations without batting an eye, there are many who have done all they can do to save their homes and have just fallen victim to unfortunate times. As professionals, we need to remember that clients are clients in good times and bad. It's how we treat them during difficult times that leaves a lasting impression!
