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15 April 2009, Clear Credit Mastermind Call Transcripts
with Mike Rockwood & Ryan Rockwood
Note: this is a transcription of our 15 Apr 09 call. Please excuse any transcription errors that may be present. Our call schedule has changed to every Tues & Thurs evening.. Please email help@60minuteloanmodification.com to be invited.
Mike: That was then, this is now, this is a very dynamic environment and you really have to keep up to date and work with current information. So what I’d like to turn to now in light of having thought about that for the month and thought what advice I would like to give all of you guys in terms of communicating for loan modification success, let me take a minute and really outline two areas. The first one is understanding the lender, and I call the lender your adversary. Because in this sense they really are. Yeah, you invested together and yeah, you were partners and all this stuff. But in the negotiations for a modification to your agreement, they are your adversary.
Ryan: Well, in the original thing you’re partners. Now, you’re diverging.
Mike: You’re adversaries. Right. Now Ryan, you know that this is true. Training horses is my favorite hobby. And communicating with horses is a real challenge. Anybody on the phone who is a horseman knows that and I’ve been thinking about how there are some real similarities. You learn ways to communicate with horses that are kind of unique to the beasts that they are. Horses are not the smartest of animals. Horses generally, most horses, are very poorly trained. Horses are hypersensitive to their environment. I think almost everybody knows that. They are flight animals.
Their first reaction is to run. And lastly horses are big and horses are very dangerous. So in these regards horses are kind of like the employees of your lenders. Kind of like the people you’re going to be talking to on the other end of the phone. They’re not the smartest animals and I don’t mean to criticize them but I mean, let’s be real. The people that they’re throwing on the phones here are young, not that young means dumb, but young means inexperienced. They’re new. They’re entry level people.
They are poorly trained because they’re growing so fast. Every one of the lenders, even the smaller lenders, are staffing up so fast that they don’t have time to train these people and some of them, I’ve actually been on the phone with people who had been in the collections department and now are loss mitigation supervisors so they’re poorly trained. Now they’re also hypersensitive to their environment. And by that I mean you have to understand what environment they’re in and the kind of things that they’re facing. And they are hypersensitive to it.
You have to understand how they are motivated, how they are measured, how they are disciplined, how they are rewarded. And they’re kind of dangerous too because if you treat them wrong or you communicate with them incorrectly they can hurt you. They can step on your foot, they can break your finger, they can break your nose. Know what I mean? These guys are big and dangerous. So in a similar way you have to really be smart about knowing who you’re talking to. You’re talking to a young, inexperienced usually poorly trained, overworked, under compensated individual with a lot of files on their desk and a lot of urgency. For those of you who have worked in call centers, and those of you who have worked in telemarketing, that have deadlines and quotas —
Ryan: We wouldn’t wish this on anyone.
Mike: – No. You understand the pressure these people are under is immense. And yeah, they get all kinds of quality training about you know, we’re not a loss mitigation department, we’re a home retention department and customers are everything and yeah, yeah, yeah. And honestly they try their very best, but let’s be real. These guys are adversaries and they’re under tremendous pressure. So that should help you in terms of your communication to think about the way you communicate with them.
Here are the best practices that I recommend for all of you to use in communicating with the lenders. First of all, prepare. What I recommend is that everybody listen to my exploits on the 60 Minute Loan Modifications Secrets CD. You get it free at our website, 60minuteloanmodification.com. And the reason I recommend everybody listen to it is because I make so many mistakes in my initial loan modifications and I share those with you that it helps you feel more comfortable about the whole process and prepare in ways to avoid those mistakes.
Secondly, you have to prepare by making sure you’re clear on your hardship. I think it’s a great work that Ryan is doing to help people get through the hardship letter because too many people spend too much time concentrating about it. Honestly, about eight out of ten people that contact us have a hardship. And even when people call in and say man, I would love to qualify for a loan modification but nothing’s changed. I can’t tell you, it really is eight out of ten times when you start poking around, in fact they’re earning less than last year. Or in fact some significant expense increased this year.
Ryan: A lot of times what happens, yeah, is that some event kind of creeps up. They might have even had the expense but then now it’s maybe doubled or tripled and so they don’t think, they’re income hasn’t gone down.
Mike: Yeah. So you have to prepare by understanding your hardship and then most importantly prepare your budget. That’s the most important financial information to have before you call and then lastly I always recommend that you remove funds on deposit with any bank that you’re negotiating with. So preparation is important. The second thing I recommend to everybody is, and this kind of bugs people, is that you answer the phone every time the lender calls, even if it’s the collection department.
Ryan: Honestly, that’s a huge drag.
Mike: Yeah. Cause most people go into denial and they don’t like to talk about their difficulty, they certainly don’t like to be reminded of it and it’s very often at an awkward time or in an awkward place. But I really urge everybody, answer that phone. Tell your story, try to get positive entries into your files, and most importantly ask questions. These are real people and if you can engage with them they very often will give you information that will be helpful to you in your loan mod effort.
And by the way, you should listen on the Phone Tap CD, you should listen to some of the examples of ways that I ask questions of different collection agents and stuff like that, because it can be really kind of fun. And they do give you a lot of good information. I think you’ll get a kick out of listening to that. Now the third thing is always document important information in writing. It’s not good enough just to make a note of it and put it into your file. You’ve got to send it to the lender. A qualified written request, page 118 of the workbook, it says the qualified written request is established by section six of the Real Estate Settlement Procedures Act. And it gives you the legal right to expect a written response from your lender, a formal written response, confirming that they received your request for information within 20 days and a formal, complete, thorough response to your inquiry within 60 days.
So it’s very important that you use the qualified written request as often as you can. Your hardship letter is a qualified written request. Your request for additional concessions at the end of the negotiation is another qualified written request and I really encourage people, use it throughout the process. And then the fourth item, I call it your log is your dog. And by that I mean it’s your friend. Believe me.
Every note you make to yourself and you know, who said what when and what the next step is, puts you at an advantage. Remember you start out these negotiations at a distinct disadvantage because the lender already knows all the remedies that are available. They know what the owner of your note has approved for concessions to modification. You don’t, so you’re at a disadvantage. So every piece of information that you can gather during the process helps to level the playing field.
Ryan: The thing on that is that it’s not too complicated either. It can just be notes on lined paper.
Mike: Right. We do provide a log for you to use. It’s on page 46 of the workbook and of course we always provide it in the appendix and a copy of it is in Word on the Black Belt CD. Now the fifth tip is communicate always and forever. Get out of line. And by that I mean communicate every single day. You all probably know that we recommend after you submitted your application to daily follow up with faxes. Our faxes that we recommend in chapter six — they’re also in the appendix, of course, and in the Black Belt CD — go like this.
The first fax, as soon as you send the application, your first faxes are simply requesting of customer service that they confirm that they’ve received the fax and that it’s complete because they won’t enter it into the system until it’s complete. Soon as you get confirmation, and you send that absolutely every day. After about four or five days you’ll get a response that you can stop faxing us now, you’re application has been received and it’s complete and then you change to the loss mitigation fax number and you start faxing them every single day. And you just tell them how important this is to you and at what number they can reach you by cell phone to reach you immediately and you will get any more information that they need.
And then as soon as they contact you and say we don’t need anymore information, you’re file has been submitted to a negotiator, then we start faxing the negotiator and we say tell us when you’re ready to talk, if you need any further information we’re ready, and then finally we wear them down to the point where after a week or so they’ll fax us back and say okay, we’re ready to talk. Now let’s arrange a telephone call. So the point is always and forever communicate. Over communicate. You’ve got to get out of line. The whole deal is there are going to be two million loan modifications processed this year. There were only 600,000 last year, so you can see how fast this is ramping up. And if you just start working the numbers you realize how many they’re taking in everyday and how many they’re processing everyday. And if you’re working with Bank of America or Wells Fargo or Citi or IndyMac, anyone of those guys probably has 30 percent of those. Maybe not that much, maybe 25 percent of those. So these guys are swamped.
You have to get out of line or else you’re going to get just what everybody else gets. Now number six is communicate in a non-threatening way. You know, I don’t know if any of you have traveled to China but in China people disrespect lines. If you’re in the line at the grocery store or in a line at a restaurant or theater or something they just have a disregard for being in line. They just kind of crowd and they walk slowly and they kind of elbow you out of the way. And if you act western about it and act like you’re offended, they’ll get behind you. So it’s a non-threatening way to get out of line and that’s what I encourage all of you to do.
And there are some great examples of this on the Phone Tap CD as well where I ask what could be perceived as threatening questions in a non threatening way. I think that everybody knows that with our premium package we offer a Phone Tap CD that has about 15 phone conversations taped. They’re conversations between me and Wells Fargo and me and IndyMac and Countrywide and all the different lenders talking on different topics and they’re also interviews with several clients, their initial application interview where we talk about their situation and their hardship, etcetera. Really helpful cause it gets people over the nervousness about you know, what’s this going to be like and what’ll be the tone of the conversation, etcetera.
Ryan: I mean, the truth is that it’s just conversations of us talking on the phone and really what could be more boring, right? But it’s one of those things like you do it, the first time’s always the hardest, and if you go in there with an idea of what you’re doing and every single thing isn’t new to you. If you know, okay, here’s this step. Here’s this step. It’s a whole other world. Whole other level of confidence.
Excerpt from teleconference transcripts. Download full transcripts here: LOAN MODIFICATION CALL TRANSCRIPTS
