Loan Mod Training | How-To Make $$ From Loan Mods
Popularity: 34%
President Obama Housing Plan.
Realtors, here is a list of 6 things you need to know about Loan Mods….
1. Payments, not prices: The plan centers on the belief that struggling borrowers will stay in their homes—even as values decline sharply—as long as they can make their monthly payments.
2. Thirty-one percent: To that end, the administration’s plan requires participating loan servicers to reduce monthly payments to no more than 38 percent of the borrower’s gross monthly income. The government would then chip in to bring payments down further, to no more than 31 percent of the borrower’s monthly income. In lowering the payment, the servicer would first reduce the interest rate to as low as 2 percent. If that’s not enough to hit the 31 percent threshold, they would then extend the terms of the loan to up to 40 years. If that’s still not enough, the servicer would forebear loan principal at no interest. The plan does not, however, require servicers to reduce mortgage principal.
Realtors, learn how-to modify your own mortgage now. Save $100s per month and $1000s per year. Next, start your own loan mod business. Make money now from loan mods while helping others save money. Watch the FREE Agent Loan Mod Secrets video NOW.
3. Cash incentives: To encourage participation, servicers will be paid $1,000 for each modification and will get an additional $1,000 payout each year for as many as three years, as long as the borrower continues making payments. Borrowers, meanwhile, can get up to $1,000 knocked off the principal of their loan each year for as many as five years if they make their payments on time. Neither party can receive the cash incentives until the modified loan payments have been made for at least three months.
4. Financial hardship: The Obama administration is pitching its plan as an effort to help responsible homeowners ensnared in the historic housing slump and painful recession—not speculators. Occupancy status will be verified through documents, such as the borrower’s credit report. In addition, the program is designed to target homeowners who are undergoing “serious hardships”—such as a loss of income—which have put them at risk of default.
5. Net present value: To determine if a particular mortgage will be modified, the servicer will perform a so-called net present value test. The test compares the expected cash flow that the loan would generate if it is modified with the expected cash flow it would generate if it isn’t. If the modified loan is expected to produce more cash flow for the mortgage holder, the servicer is to restructure the loan.
6. Second liens: The Obama plan also addresses the issue of second liens—such as home equity loans or home equity lines of credit—by offering incentives to extinguish them.
Realtors, learn how-to modify your own mortgage now. Save $100s per month and $1000s per year. Next, start your own loan mod business. Make money now from loan mods while helping others save money. Watch the FREE Agent Loan Mod Secrets video NOW.
New Feature: Ask Tim and Julie Harris | Realtor Coaching
Popularity: 54%
Ask Tim and Julie…..
We recently received this question from a Realtor whom had requested a Free Coaching Call….
“My problem is the dramatic swings in my income…one month I will do great…and for the next couple months I will be in survival mode. How can I get my business to the point where I can have cash flow…vs cash spurts?”
Connie, Realtor from Arizona.
Tim and Julie’s response:
Hi Connie,
Your question is symbolic of a problem that 99.9% of all real estate agents face. So, if it makes you feel any better…you are not alone!
The challenge is that agents think too much like sales people and not enough like business people. Let me explain…
Agents will go from intense periods of looking for business…followed by intense periods of servicing the business they found.
For example, you decided to list 2-3 houses. That becomes your mission in life…list those homes! You are a focused, driven house listing machine.
In order to accomplish that goal you become more intense, more focused…..you become what we call…the Real Estate Navy Seal. You are intensely focused on:
1) Asking for business.
2) Lead generating, prospecting.
3) Going on appointments.
4) Doing lead follow up. (have you ever noticed the amount of time you take to call a lead back is directly related to the size of your checking account and number of pending deals?)
5) Take action..you are going on appointments, doing the things you must do to accomplish your goal.
As a Real Estate Navy Seal you are intense, focused….nothing gets by you. If someone from a mile away mentions selling a home….your heightened Seal ears pick up on the words and you are asking for the business…
The Real Estate Navy Seal is proactive…taking action now…vs reactive.
You indeed accomplish your goal of listing those 3 homes. You did it…goal accomplished.
Now what happens…
You go from being from being a Real Estate Navy Seal Mode (RENS) into…..a……
Not so intense, slower moving, not all that motivated…Real Estate Sloth (RES). As a sloth you move slower, talk slower, think slower….you are no longer in ACTION MODE….you are now in reaction mode.
Your focus and energies are no longer on generating the business. That powerful, focused intense agent that you had to be has been replaced by its alter ego…the the Real Estate Sloth.
You are now focused on doing things like:
1) Making home brochures.
2) Realtor tours and maybe open houses.
3) Putting the homes on 6 bazillion web sites.
4) Servicing your sellers.
5) Speaking with potential buyers
6) Working on your websites.
7) Going to endless office meetings….
Obviously, this list could go on and on. The point is..how much time are you spending being the Real Estate Navy Seal vs the Real Estate Sloth?
Here is a great question for you. How much time did you honestly spend in the last 30 days being in Real Estate Navy Seal Mode vs being just another Real Estate Sloth?
Chances are, if your income is constantly going up and down…or maybe you aren’t earning what you need/ want to earn…its because you have yet to understand that being a RENS is actually LESS work than being a RES…..
Every day at HREU we have literally thousands of Realtors participating in a coaching program. I am not telling you that to brag. You must know that what you are experiencing is common. Believe it or not…there is a proven path for you to follow to learn how to go from being the Sloth to being a Seal.
The first step in creating consistent income is learning how to work consistently. Here is the secret..Consistent Effort and Actions = Consistent Results.
The Navy Seal is in GO mode at all times. He is ready for action NOW. Even more so…he makes things happen. He IS the action. Most importantly, the Real Estate Navy Seal has learned how to be intense..focused…even when he doesn’t feel like it.
Most agents only get results when they feel like it. Only when they feel motivated…when they feel scared because they are broke etc. Look around your market place…you know who the RENS are. They are the agents who produce month in and month out. These are the agents who are growing their businesses in this market…helping more people…making more money than every before. In case you haven’t discovered our FREE Realtor Superstar Interview site…check it out. Free Weekly Interviews with the nations real estate movers and shakers.
The Real Estate Sloth is intense, focused and taking action maybe 10% of the time. The rest of the time…they are just hanging out doing stuff that ‘fills their day…and empties their wallets.’
Are you being consistently inconsistent? In other words, IF you being honest how much time do you REALLY spend at these activities:
Take this simple test. Answer these questions:
1) How much time are you devoting to lead generating? Old school over the phone prospecting to 21st Century methods…they are all valid and great ways to generate business. How much time (honestly) did you spend this week…heck, all month…on proactively going AFTER business?
(If you don’t know the answer to this question its a sure sign you are currently in Sloth Mode.)
2) What is your lead follow Up plan? I can tell you from our personal real estate selling experience that lack of effective lead follow up is costing you at least 10 sales per year. (easily). In THIS housing market you have to call every lead back within no more than 5 minutes. And your new lead follow up rule should be:
“I will follow up with this lead until one of two things happens…they list or buy with someone else or they file a restraining order against me.”
Hopefully you know that I was joking about the restraining order. But, its my intention that you understand the intensity that is absolutely required in this market for lead follow up.
(Real Estate Navy Seals have pre-qual forms, scripts, systems…they are ready for action!)
3) Are you pre-qualifying 100% of your leads…100% of the time? Do you use anything resembling a script when you pre-qual? Do you ask them questions that are designed to….you know…generate business? How much more time would you have, how much more…dare I say….money would you have IF you were to actually learn how to truly prequalify every buyer and seller lead you speak with?
4) Presenting. At HREU we coach our students to have an organized listing AND buyer presentation. But, no presentation is worth anything unless YOU are out there..in front of potential buyers and sellers…presenting. Is your listing (and buyer) presentations just a mish-mash of things you have picked up along the way? A little of this..a little of that? Maybe your presentation has ‘worked’ for you 50% of the time. In other words, the buyer and seller prospects you were presenting to didn’t run and hide from you as a result of your ad-hoc presentation. Think about this, what happened to the other 50%? How much more consistent would your income be if you not only had a very professional sales presentation…and you were using it on a regular basis?
5) Closing. How much time are you spending….asking for the sale? Julie and I occasionally watch the HGTV real estate shows…Realtors showing endless homes to their weary buyers.
It’s interesting to watch as the agents seem to always complain about how many houses they have to show….and at the same time the buyers complain about how many houses they are being dragged to see.
I can tell you from personal experience that when we had our real estate team, we sold many homes to many buyers who came to us having grown discontented with their previous agents.
In the course of pre-qualifying them we would learn that the previous agent had been working with them for months (and months). I can clearly remember many of these wayward buyers telling us that they had seen a home with their previous agent that they had indeed liked…but, didn’t buy it. (and it had subsequently sold). When we would ask why they didn’t buy it they would always tell us the same thing..
”The agent we were working with didn’t ask us to…or we didn’t know that it was out job to tell the agent….we wanted to buy…”
In other words, their previous agent never tried to close the sale. Generally speaking if a buyer is in your car, and they have been fully prequalified..ready to buy….they are indeed ready…to buy! So, close them. THAT’S YOUR JOB.
Bottom line, consistent organized actions will create consistent income. If you are ready to make the leap to become a Real Estate Navy Seal start by requesting a FREE Coaching Call.
At What Point Would YOU Walk Away?
Popularity: 43%
New study about what economists are calling, “Strategic Default”. Where homeowners who CAN afford to stay in their homes despite negative equity are choosing not to……
How widespread is this practice? New research* based on a survey of 1,000 homeowners suggests that one in four mortgage defaults are “strategic”—by people who could meet their payments but who choose not to. The main drivers of strategic default are the scale of negative equity, and moral and social considerations. Few would opt to renege on their mortgage if the equity gap were below 10% of their home’s value, the authors find, partly because of the costs of moving. But one in six would bail out if loans were underwater by a half.
* 25% of all defaults are homeowners who CAN afford to pay..choosing not to. They are making the decision that the negative ramifications of foreclosure (or short sale) are less significant to them than the burden of the negative equity.
Four-fifths think strategic default is wrong. Those in the unethical minority are four times more likely to renege on loans (allowing for other influences) when their negative equity reaches $50,000. But morality has its price. When the equity gap reaches $100,000, “immoral” homeowners are only twice as keen to walk away from their debts as “moral” ones. People under 35 or over 65 are less likely to believe that default is wrong. So are the well-educated.
* Interesting….People under 35 or over 65 are less likely to believe that default is wrong. So are the well-educated.
* There IS a price…there is a number where even the most financially conservative homeowner will walk away. Understand, this is what keeps the banks (and the government) up at night. They know that once a homeowner is X% upside down…they will let the house go..(Short Sale or for the misinformed…foreclosure).
Anger about bail-outs of banks or carmakers does not weaken the moral barrier to default. But people who live in neighbourhoods where home repossessions are frequent are more likely to welsh on loans. Homeowners who know someone who has defaulted strategically are 82% more likely to say they would do so, too. The likelihood of strategic default rises more quickly once the rate of local home foreclosures reaches a critical level. That hints at a vicious cycle of foreclosures that both depress home prices and weaken the social and economic barriers to further defaults. To break the cycle, policymakers need to address the problem of negative equity, not just unaffordable interest payments.
Here are my questions for you…what is your number? Seriously….at what point would you decide that leaving is better than staying…
Are you considering or have you already done a ’strategic default’?
How much negative equity would your mortgage have to be before you choose to sell it short sale (etc)?
What are you seeing in your market..are homeowners choosing to let their homes go that are 10% upside down….30%…50%? In areas of the country where homes have depreciated 30%+ what will keep those homeowners from not following this same path?
Let us know what you think..share your comments….
(The answer to THESE QUESTIONS are at the essence of what will allow this housing lead depression/ recession to end)
When Will The Housing Crash Be Over?
Popularity: 26%
WASHINGTON (AP) — Is the historic U.S. housing market crash close to being over, or is the end still far, far away?
While sales finally seem to be stabilizing, prices are still are likely to keep sinking well into next year and maybe longer. Prices have been cut in half in Las Vegas and Phoenix, according to one popular home price measurement.
<!– #sponsored1 { border:1px solid #E5E6DA; margin-bottom:10px; margin-top:5px; padding:2px 10px 10px; position:relative; font-family:Arial, Helvetica, sans-serif; font-size:12px; } #sponsored1 .header-sect { background:#FFFFFF none repeat scroll 0%; text-align:center; position:relative; top:-12px; left:52px; width:108px; } #sponsored1 .header-sect a { color:#818181; font-size:10px; font-weight:bold; text-transform:uppercase; font-family:Verdana, Helvetica, sans-serif; } #sponsored1 a:link { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:none; } #sponsored1 a:visited { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:none; } #sponsored1 a:hover { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:underline; } #sponsored1 a:active { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:none; } #sponsored1 .ad-link { font-weight:bold; } #sponsored1 p { margin:2px 0; } #sponsored1 p.titulo { margin-top:8px; } #sponsored1 .link a { font-size:10px; color:#999999 !important; } #sponsored1 .titulo a { color:#007AAA; } // #googleads { padding-bottom:8px; border-bottom:1px solid #CCCCCC; } –>
But statistics like these mask the many complexities involved in trying to measure U.S. home prices.
Every home price gauge captures a somewhat different slice of the housing market, even when they all depict the same general trend.
Also, all real estate is local — some neighborhoods have largely escaped the housing bust, and price declines can vary sharply within a single metro area. In many parts of the country, faraway suburbs, where many buyers moved into new subdivisions and stretched to qualify for mortgages, have been hit harder than established, wealthy enclaves.
Here are some answers to common questions about how home prices are measured.
Q: How far have national home prices fallen?
A: It depends on what measurement you use. But according to the Standard & Poor’s/Case-Shiller National Home Price index, the measure that’s most widely watched on Wall Street, home prices have fallen 32 percent after peaking in the second quarter of 2006.
Q: How much will they drop in the future?
A: Analysts expect national prices to drop another 10 to 15 percent over the next year, depending on how long the recession lasts and its severity.
Markets that were last to be hit by the housing bust will be the slowest to emerge. Deutsche Bank, for example, projects prices in New York are still likely to fall another 40 percent. Los Angeles, meanwhile, has only another 11 percent left to go, according to the Wall Street firm’s forecast.
Q: Do real estate agents have anything to say about home prices?
A: Yes. The National Association of Realtors’ median home sales price — collected from real estate listing services around the country — is another prominent measurement. It peaked at $230,300 in July 2006 and has since fallen about 25 percent to a median of $173,000 in May.
Q: That’s pretty easy to understand. Why not just use that?
A: Economists don’t like using median prices because they can be skewed by a change in the mix of properties that sell in a given month.
A median is the point at which half of the prices are above, and half below. If many low-end properties sell in one month, that will push the median lower; if many high-end properties sell, the median goes higher. Economists want to make sure their data isn’t distorted by those natural fluctuations.
Q: How do you fix that problem?
A: Economists have created indexes like the Case-Shiller reading that examine price changes for the same properties over time instead of calculating a median price for all houses sold during a particular month or quarter. Doing so prevents the data from being skewed by changes in the mix of houses sold.
Q: Does the government collect similar information?
A: Yes. One index, created by the Federal Housing Finance Agency, is calculated solely using loans that are bought or backed by government-sponsored mortgage companies Fannie Mae and Freddie Mac.
Importantly, that excludes many high-end properties, as well as many properties bought with some of the riskier varieties of home
loans that went sour this year. Also, if an investor pays entirely in cash, those transactions are excluded.
As a result, this index paints a much more tempered picture of the housing bust. It shows home prices dropping by just over 11 percent from a peak in April 2007.
<!– #sponsored1 { border:1px solid #E5E6DA; margin-bottom:10px; margin-top:5px; padding:2px 10px 10px; position:relative; font-family:Arial, Helvetica, sans-serif; font-size:12px; } #sponsored1 .header-sect { background:#FFFFFF none repeat scroll 0%; text-align:center; position:relative; top:-12px; left:52px; width:108px; } #sponsored1 .header-sect a { color:#818181; font-size:10px; font-weight:bold; text-transform:uppercase; font-family:Verdana, Helvetica, sans-serif; } #sponsored1 a:link { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:none; } #sponsored1 a:visited { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:none; } #sponsored1 a:hover { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:underline; } #sponsored1 a:active { color:#818181; outline-color:invert; outline-style:none; outline-width:medium; text-decoration:none; } #sponsored1 .ad-link { font-weight:bold; } #sponsored1 p { margin:2px 0; } #sponsored1 p.titulo { margin-top:8px; } #sponsored1 .link a { font-size:10px; color:#999999 !important; } #sponsored1 .titulo a { color:#007AAA; } // #googleads { padding-bottom:8px; border-bottom:1px solid #CCCCCC; } –>
“It’s missing much of the action,” said Dean Baker, an economist and co-director of the liberal Center for Economic Policy Research in Washington.
By contrast, the Case-Shiller index, developed by Yale University economist Robert Shiller and Wellesley College economist Karl Case, peaked in mid-2006 and has shown far more rapid and dramatic declines.
Q: Which one is better?
A: Both are valid measurements — they just measure different things, experts say. Nevertheless, investors will be far more interested when they finally see some consistent positive trends in the Case-Shiller index — most likely a substantial slowdown in the rate of decline. That’s likely to mean that the housing bust is finally wearing down.
Q: When will that finally happen?
A: It could be at least a year, economists say.
“House price trends, they’re more like Mack trucks than Porsches,” said Mark Fleming, chief economist with First American CoreLogic, which has its own home price index. “The truck is still in reverse.”
Q: What impact do foreclosures have on prices?
A: They drag them way down. In fact, many real estate agents say that when you factor out foreclosures and other distressed properties, their markets look a whole lot healthier.
In Minneapolis, for example, median prices were down about 22 percent to a median of around $123,000 in the first three months of this year for distressed properties, but declined less than 4 percent to a median of $212,000 for traditional, non-distressed sales.
“We describe our market as a tale of two markets,” said Mark Allen, CEO of the Minneapolis Area Association of Realtors.
