Mike Rockwood: Hello, everybody.
Ryan Rockwood: All right, on queue. Sorry for those of us who have heard this twice. Okay, before we get started I’d like to make a couple of quick announcements. It looks like we’ve got the technical difficulties out of the way.
Announcement number one. My dad, Mike, and I are hosting a live event here in the South Bay on the 4th of May. And we have limited time free spaces available for this one-time workshop. We have done some of these in the past and they have been spectacular. Partially because we haven’t really gotten the word out very well and we basically done very small group workshops that will be able to really help some people, I think. Anyway, they left pretty happy and they felt like it was a good use of their time.
Each month we try to do at least one community service event. And this month, we’re hosting a 90-minute information-packed session where we give live assistance to people in our local community. But we wanted to open it up to you as a subscriber as well. To reserve your space, please e-mail help@60minuteloanmodification.com or call 310-634-0362.
Announcement number two. We are huge advocates of Do-it-Yourself Loan Modification. But we still know at least 50% of our listeners just plain don’t want to do it themselves. And that’s fine because really, you just need to do something. Somebody needs to do it, right? So with that in mind, we have openings right now for four more elite express loan modification clients this month. We can’t really take on more than four. So, if you’d like us to do your loan modification for your, please visit our site and click on the elite express service at the top of the navigation bar for details.
Mike Rockwood: Ryan, is the website an operational now? – I know it’s Tuesday upfront.
Ryan Rockwood: I got these complete reports on that actually. But regardless, you can always just send us an e-mail at help@60minuteloanmodification.com. The bottom line is that …
Mike Rockwood: But we were just having a little bit trouble with ordering and a little trouble with the videos, right?
Ryan Rockwood: Yes. Well, hopefully, we’ll get that all taken care of. But if you go there and someone also is having trouble ordering today, if you go there and it doesn’t look quite right, it looks like our old offering or something, have no fear. Just give us an e-mail and we’ll give you a call and get you set up if you want us to do the loan mod for you. But now let’s get back and focus on do it yourself first. That is the focus of today’s call.
Mike Rockwood: All right, I’ve strapped on my tool belt, Ryan.
Ryan Rockwood: All right.
Mike Rockwood: I’m ready to talk about doing loan mods yourself. Now, we want to take 10 minutes or so and talk about two sections of the workbook. For those of you who have the workbook in front of you, we want to talk about Chapter 3 and 4. But honestly what we want to do really is just start for a little bit.
Let’s talk particularly about number three, why you must do your own loan mod? This is very timely. So, we’ll talk about why you must do your own loan mod. That starts on page 37 of the book. And I really want to take time to go through this because I think it’s pretty significant. A lot of times people just waffle about “What should I do? What should I do? What should I do?” And they listen to a few of our teleconferences and they have a conference call with us or two and they begin to exchange e-mails. And I think this section will really help you figure out whether or not you should do this yourself. And then we’ll take it right up to the point where we’re ready to start the application. And then on Tuesday, we will jump right into the hard – we’ll have a section on hardship letter and on the budget, which is that’s really the meat of the application, all right.
Ryan Rockwood: Now a ton of money has gone to helping homeowners get loan modification.
Mike Rockwood: Right. And they’re oh, man, there are resources and there are tools available in many, many places. And the lenders themselves actually provide that ton of assistance. So, the truth of the matter is, it’s very similar like we always say to your taxes. The IRS provides a lot of information but number one, who can get through all that stuff? Number two, who has the time? And number three, you know the IRS is not on your side in that negotiation. So, what you really need is to be crazy informed and street smart about what all the questions mean, what all the forms are used for, et cetera. So let’s jump right into Chapter 3.
Ryan Rockwood: Once again, when we say do it yourself. We’re not advocating doing something crazy that you have no experience or business doing. We’re saying, get yourself a little bit of education and do it yourself, right. It’s not like anyone can run a marathon so go run a marathon and have a heart attack and a stroke tomorrow. You know what I’m saying? It’s like you’re no business running a marathon. You’re 100 pounds overweight, whatever. You know what I mean?
Mike Rockwood: Here begins your training program for doing a loan modification. And you know it’s really funny that you would say that because in the last two days, I initiate about three loan modifications everyday, three to four. And in the last couple of days, I have interacted with some really highly educated and really sophisticated business thinkers who, if they had just called their lender before they called me, would have instantly been denied their loan modification because they really has no clue as to where it was going. So, it’s not a matter of being bright. It’s not a matter of being sophisticated in business or finance. You just need to understand this process of how the banks are evaluating you as a loan mod candidate, and then play your strengths.
Ryan Rockwood: And really the goal here is everything you need to know is in our kit. And also, it’s really repeated on these calls for people who like to reiterate on these calls for people who learn better that way, right?
Mike Rockwood: Yes.
Ryan Rockwood: So, we’re not saying you need to go out and get like a college degree on this or something. This is enough. You will know enough when you’re done with this. Like last time we talk about hardships. The hardship is done.
Mike Rockwood: Yes.
Ryan Rockwood: And everyone, those people that were on those calls, we help some really great people with hardships. And those letters are solid. I did a bunch of – we did a hardship letter giveaway. And I guarantee you, well, I can’t guarantee you anything.
Mike Rockwood: Now they were pretty good, Ryan.
Ryan Rockwood: Yes, they’re good. No one – I mean they’re just clear. So, that aspect of it is I’ve checked that off and moved on. Okay so back to this. You know, the whole idea is – you know a lot of this. It’s kind of like there’s a lot of naysayers that will tell you, in all the things in life, don’t do it, period. And if we had accepted those naysayers most of us maybe wouldn’t have gotten to college, wouldn’t have ever asked that girl out that we were whatever, you know what I mean?
So against all odds, my dad, Mike, got turned out for a loan mod about five times and then he got one. So, the idea of no one loves you better than you is quite true. And we really urge our clients to go from a position of – I can’t tell you how often some of – you know do I qualify for a loan mod then duh-duh-duh. No, it’s not worth it, this or that.
Mike Rockwood: Yes. Someone told me the stuff like that.
Ryan Rockwood: And then everyone with no business talking about period will talk you out of it and why it’s a better just to continuing on languishing. But our kind of thing is without even talking to you, you qualify. How can we help you fit within the parameters of qualification?
Mike Rockwood: That would be helpful to get a loan modification.
Ryan Rockwood: Yes. Yes.
Mike Rockwood: All right now, here are four reasons why you must do it yourself and for those of you who have the workbook in front of you, it’s on page 37. A ton of money is gone toward helping homeowners to get loan modifications. The lender and federal and state agencies involved have staff and they’ve contracted with non-profits, et cetera, to make the whole process easy and readily available to all of us. Hundreds of millions of dollars of your tax money has been allocated to providing counseling service to help us.
Dozens of community-based non-profit have staff to meet the challenge. Also many first-rate private companies have contracted with the lenders to facilitate the process. And some of those resources are truly helpful. But these well-intentioned organizations, although they’re helpful, that is the good news part of it.
The bad news is nobody loves you more than you. And that’s the second reason why. The first reason why you must first do it yourself then is there’s a lot of help out there. There’s a lot of assistance already in the pipeline for you. The second reason you must do this yourself is that no one loves you more than you do. Like most government or bureaucratic efforts and non-profits provide way too much information. And almost no actionable strategies that benefit you.
Ryan Rockwood: It’s not really helpful, you know, what form you need to fill out.
Mike Rockwood: Yes, you have to know what to put in this box.
Ryan Rockwood: Yes.
Mike Rockwood: And what’s this going to be used for. More troubling, those organizations don’t owe any allegiance to anyone. They’re just charged with reaching an equitable settlement. I don’t know about you but that’s not the type of backing that I want in my corner. When I go into a street fight, I want to know that the people on my side of the street are going to fight for me. So, you need insider advice on how to win unequivocably, unequivocally. That is what we’re all about getting you the best loan modification.
Ryan Rockwood: And that’s one of the frustrations, I think, is that nobody in trouble wants to fight fair. We’re little guys. We’re little investors. We’re homeowners, little individual business owners. We need an unfair advantage.
Mike Rockwood: Yes. Well, and you’re up against this lender who has passed all the cards.
Ryan Rockwood: Yes. And so a lot of that stuff from the non-profits and so on, it’s kind of like well that …
Mike Rockwood: That’s fine for everybody in line. But like we always say is we’re going to help out everybody get out of line and get to the front of the line. Okay, for a lot of reasons.
Ryan Rockwood: Okay, so what’s the next point?
Mike Rockwood: The lenders are clearly your adversaries. They will try to get to accept the best deal for them. The four profit loan modification companies, they’re in it for the money. They have to maximize the number of clients that they start. And then as soon as they sign you up, they have to minimize the time and expenses they spend on you. That’s how they make a living. The loan mod firms routinely botch loan modifications by dropping the ball on followup.
Followup is really important not only to getting a good loan mod but to keeping the client, keeping you understanding how the process is going. Number two, they all often send out these hack form letters. Number three, they accept the first offer that the bank throws out almost always. And then number four is they often reveal damaging information to the lender without the lender even asking for such information because they do what they shouldn’t do and that is provide all information, not just exactly what information is asked for. It’s the easy way out.
Ryan Rockwood: Okay, so differences between a modified loan versus a refinance because I know a lot of people are asking me, “Could I refinance?” Refinance is not bad. It’s not a bad option. But in most of the cases the people that I talk to, they would perhaps told that they might be able to – that they would be able to refinance out because everyone was able to refinance everything.
Mike Rockwood: Because everything was growing.
Ryan Rockwood: And we’re all kind of proud on that. But most people they don’t have – refinance is not a realistic option. I mean, we don’t do loans but we have a fantastic mortgage broker if anyone wants a recommendation. You can always run through the thing and she’ll tell you very frankly, no or yes, you know. So, you can always shoot us an e-mail at help@60minuteloanmodification.com if you wanted to try refi or anything like that. But I mean now it’s all about equity. No one’s going to go at 100% that anymore. You know, no one is going to go anywhere close to that. So, if your mortgage is 80% or more, you can just right now forget a refinance absolutely.
Ryan Rockwood: Well, and the thing is you shouldn’t really be thinking about a refinance until you examine of the loan modification opportunity because with the loan modification, there’s no broker fee, there’s no advocation fee, there are no points obviously, there’s no appraisal needed, there’s no escrow fees, no title fees. Your credit score is completely irrelevant and it’s completed just as fast as a refinance.
In fact, refinances are taking sometimes a couple of months these days. So, really loan modification should be your first thought before refi. It’s significantly less expensive. And it’s really significantly easier for everyone as well.
Mike Rockwood: It’s kind of like a free refi.
Ryan Rockwood: Yes. And you know a more obscure point and for giving you this is it’s a little too complicated. But what a mortgage modification can do is modify an original note. Okay. So, what a refinance does is replaces the note with a new one. Okay, so in some states like Florida, these are states that are called recourse states. And that means that your lenders may be able to go after you for the amount owed. Does that make sense? And so it’s very important. So how can I put this most simply? Refinances are not purchased money loans. Purchased money loans are many times in many states, they protect you from having – allowing your lenders to go after you beyond the house. Okay. So, in other words it’s a – it’s an added fund.
Mike Rockwood: So, the loan modification preserves all your initial protections with regards to recourse.
Ryan Rockwood: Yes.
Mike Rockwood: Yes. All right. Let me make two more points about why you must do the loan modification yourself. Man, it’s not rocket science. The third point I make in the book is it’s not rocket science. It’s really a simple process. You just need to know the angles and get your story straight.
And number four is you can make it personal. And honestly I believe in this. That business is personal. It’s people to people and you’ll be much more effective if you understand that and work with people and make a connection with everybody at the lender that you can make a personal connection. So, I mean, these are regular old blokes like you and me, you know. They all have mortgages. They’re all working folks and they’re not highly paid folks either. So, they understand and appreciate your predicament if you take time and give them the respect, and listen to them, and make a connection with them. All right, so those are the reasons why I believe you should do this yourself.
Ryan Rockwood: It somewhat sounds hard to me. Do you think that really being nice to someone at the bank could really ever benefit? I mean, it’s not your negotiator though.
Mike Rockwood: Yes. I honestly do because I believe, I know that they – just the entries into your record – you know, everybody who talks to you makes an entry into your record. And jus the tone, the type of entry they make, I’m telling you, it does make a difference. I absolutely know it does in terms of the help that they offer, the connection they make with you, I know it does. I mean, I just had too many [indiscernible].
Ryan Rockwood: Being nice is hard though, you know, it takes work.
Mike Rockwood: I know. Some of us are born naturally [indiscernible].
Ryan Rockwood: The other thing here that I have found is that, it’s extremely difficult for someone – I mean, people that we talk to they’re not sleeping well at night. You know, this is pressing on them. So, there are tons of emotions wrapped up in this. You feel humiliated or unsure sometimes on the phone. And talking to these people – it can seem. It can be easy not to be nice. This is what I’m saying.
Mike Rockwood: Sure.
Ryan Rockwood: Or to get frustrated to be hurt. And one thing that I have found, it really helps out is getting a little distance emotionally from something. And hopefully, one of the things we did was we recorded all kinds of conversations we had with banks and that’s on a CD called Phone Tap. The idea is to demystify the process and to also take away some of the – well, to help you get past any kind of fears or stigma because if you can have a more objective point of view or attitude going in …
Mike Rockwood: That’s a really good point.
Ryan Rockwood: Yes like getting turned down from them isn’t a personal thing, all right. You don’t take it personally just have to figure out how you get on to the next person, right? So, anyway, if that can help those of you who might be struggling to be kind to the bank is to think of that that tried to – attempts to have a little objectivity.
Mike Rockwood: Sure. All right, and then I want to cover a few more things before we go to questions. One is, I wanted to cover – in the Chapter 4, it’s all about getting ready to fill out your application and I’m going to talk about the forms that I want you to get ready, the documents that you have to get ready before you begin the application process but I also wanted to emphasize to folks that during the whole process right from the beginning as soon as you contact the lender, it’s all about negotiation.
And in a negotiation, information is power. And so what you want to do is keep a very careful log of all the conversations you have. And for a lot of people at least half of our listeners, that is drudgery and they’re not use to that kind of detail and they don’t’ like to do that. But believe me you will appreciate it when six weeks later you are able to recall who told you, what, when. It really can be really powerful and very helpful as the negotiation goes along.
Ryan Rockwood: You know what I thought about that though has struck me that a lot of times when I’m calling I only get a name Mike. Do you know what I mean? How do you – how is that? Have you had success asking for a sort of identification number or how have you done that?
Mike Rockwood: Yes. They all have an identification number, all the reps. However, that’s all I do is record their first name. Because honestly, if you have any claim against him or you say this or that, you know, they have incredible records. And of course, audio records of everything you say to them. So, they’re the ones with the power. You have to try to catch up a little bit by at least having scribbly notes about what was said, on what date, by whom. We have that activity log that we provide in the workbook. It’s in the appendix. And it’s also on the Black Belt CD. On the Black Belt CD we provide all the forms that you’ll need for your loan modification. And they’re in active Excel and Word file, so you can change them all through them. Make them personal to your own situation.
Now, okay. Then, this is a very important point I want to make now and then we’ll go to questions. At the beginning of Chapter 5, we talk about getting started on the application. And this section called Gather Five Documents is still absolutely critical. So, here’s what I want you to do.
Ryan Rockwood: If this could be magically done for people this hard, there would be about – I don’t know, 10 times the amount of applicants for loan mods.
Mike Rockwood: Isn’t that true.
Ryan Rockwood: You know, it’s five documents. It’s the gating factor.
Mike Rockwood: How about this Ryan? There’s a huge emotional hurdle to starting the process. Once people say, “Yes, you know, let’s go for it.” Once you get to that point, you think you’re home free? No. Gathering these five documents is just a killer for a lot of people. And it really shouldn’t be. Here’s what you have to do. Gather documentation of your household income. And for a lot of self-employed people, that is difficult but you got to get through it. You have to establish a business PNL and it’s got to be very recent. These loan mod people are interested in the last 30 days, the last 60 days, and the last 90 days, period, end of sentence.
And of course if you have paychecks, that’s easy. If you have 1099s from the prior year, that’s easy. Second thing is you need two very recent and consecutive monthly statements from your checking and your savings account. It’s really important to try to provide both checking and savings account even if you don’t use that savings account is very much. And the reason for that is the bank – account just because most banks push so hard to open a savings account with the checking account. So, they expect you to have one. And if you tell them you don’t have one or you don’t supply it, they think you’re hiding some assets.
Third thing you want to have is two most recent statements from the lender and any pertinent default notices. And then the fourth thing is the last two years of your federal taxes, all forms. Now, we have been lately asking people to also bring to this first discussion a copy of the note if they can get it. Of course we get it from a title company if it’s not easy for them to get. All right, so those are the five documents. If you get over the hurdle of yes, I’m going to get a modification, you know, get over the emotional hurdle and you get those five documents together, you’re 75% of the way you done with your loan modification. Should we go to questions, Ryan?
Ryan Rockwood: Yes let’s do it. By the way, for those people that are new to the call, what we’re doing is we’ve changed the format of the calls. They’re on Tuesdays and Thursdays – every Tuesday and Thursday. And we’re going to walk you through the loan modification process. We’re going to keep the calls a little shorter probably 45 minutes, an hour at the max, and we’re going to try that out. So far, people liked it.
Mike Rockwood: Are you getting some e-mail questions already tonight or …?
Ryan Rockwood: No, I haven’t got any yet. But you know I haven’t done a really good job about announcing the e-mails. You can e-mail questions if you like to help@60minuteloanmodification.com.
Mike Rockwood: Ryan, I see those right in front of them so though you can answer it now.
Ryan Rockwood: Okay, let’s go to a caller. Yes, I will figurer out how to do this. Hey, you guys, who’s got a question there.
Male Speaker 1: Hello. [Indiscernible].
Ryan Rockwood: Hi.
Gino: Hello, Mike and Ryan.
Ryan Rockwood: Hey there. What can we help you with? Hello, what’s your name?
Gino: My name is Gino. I have a question about the elite service.
Ryan Rockwood: Hey, Gino. How are you doing?
Gino: Good. Going off of your do-it-yourself personal touch, be nice to the people. How does that change when the paralegals are used with your elite service? Did they – have they able to do it the way you want us to do?
Ryan Rockwood: Well, you know it’s kind of – if it seems kind of contradictory, it is. The bottom line is we kind of felt like everyone is going to – let me that mute everyone so you can hear me, I’m sorry.
Sorry, the caller there was Gino. Thank you so much, Gino. Gino is asking, hey what about the elite express service where people – basically, that’s where we help people do it themselves. And as I was saying if it seems kind of contradictory that we have that service, it totally is. There’s no way getting around it. But basically we – spend a lot of time writing this book that teaches you exactly how to do it, okay. And we put it in there all the best practices. And what we basically felt like was that, gosh, everyone’s going to want to buy this book and do it themselves. But it turns out that a lot of people just say, hey it’s super that you wrote the greatest loan modification book on earth, but I need some help and can you help me?
And the bottom line is we could help some people in California but we really weren’t set up for it because we had this other product and we didn’t have any one we felt comfortable recommending or referring people to. You know, we see the all the news on loan modification scams just like anyone else. So, what we ended up doing was creating a division for those people who we couldn’t convince to do it themselves. And now, in order to get licensed and legal in all 50 states which we are, which is like so awesome, in order to do that we have a national paralegal network that we’re affiliated with.
And once we gather the application, put is all together, and actually we have to do most of it but what we do is we work – Mike and I work with you put together your whole package. And then and only then, when it basically has to go on auto pilot when the thing’s done and it just has to go on auto pilot and calls have to be made and followup through them, we need the system for that and we need a paralegal. And we only use ones that we feel very, very comfortable about. Our callers get the direct phone numbers of the paralegal and they could call anytime and they can call us but, of course, they could call up person directly to do.
Mike Rockwood: And they’re really good on e-mail response too.
Ryan Rockwood: But the bottom line is I think that no one can really do it better than you on the phone, but a professional can do it well. And once we put the package together hopefully, we’ve done it right the first time and there won’t be a lot of back and forth. And if there is a problem, then we can jump on the phone and take care of that. All right, let me jump on again and see if we got anymore questions.
Jacky: Hi
Ryan Rockwood: Hey there. Who’s got a question?
Jacky: Amanda.
Ryan Rockwood: Amanda, Amanda, how can we help you?
Jacky: I have a question. [Indiscernible] e-mail today from a loan modification company but long story, I was going to represent them but I’m not. Anyway, they said that they cancelled Obama’s new plan that they had and regroup, redo everything, and that everything is taking like five times as long.
Ryan Rockwood: Five times as long?
Jacky: And you know, basically. And I forwarded you the e-mail so you could see it. My question is, is that true because I have a client, an insurance agent who is two months behind, not quite two months, and I already got a letter from Litton, which I notice that you did your loan mod with. And he intends to begin foreclosure or whatever. So, I’m trying to tie to help her. I’m joining your program so that I can learn, so I can help my client. [Indiscernible] they’re very [indiscernible] couple and I don’t want them to lose their home. So, I am [indiscernible] her.
Ryan Rockwood: Well, I think that Litton is really the devil but they have done some – we have been able to get some good deals out of them. But tell me, what is your question in particular?
Jacky: Well I told her to start doing everything in writing and to quit calling them. Is that a good suggestion.
Ryan Rockwood: That is absolutely a good suggestion. But the main thing that I would urge you to do is get that little modification application this week. Amanda, right?
Jacky: My name is Jacky. I’m Jacky.
Ryan Rockwood: Oh Jacky, sorry. Jacky, get it in this week. And take our course and – I mean cram through it and e-mail us for a review of your hardship letter, for a review of your budget, that kind of thing. But forget it in this week. There is no excuse not to be able to get it in this week. Really, the only reason that you couldn’t get it in this week would be that maybe they couldn’t provide such documentation that you needed. But even that you kind of push them around and help them out, you know?
Jacky: Yes, but here’s the deal. She already gave them a hardship letter and they have given her a list of her expenses.
Ryan Rockwood: Yes, forget that. Just act like that never happened?
Jacky: Okay.
Ryan Rockwood: And whenever, you want to submit everything all together at once. You know what I mean? So, if they have it, let’s go back at that hardship letter and look at it though and make sure that it’s right.
Jacky: Okay.
Ryan Rockwood: Let’s look at that budget and make sure that she’s not more than $500 negative or positive a month in terms of cash flow, okay?
Jacky: That is perfect. Yes. That’s because I did the numbers and 31%, you’re right in the ball part. I am joining your program as soon as I get off the call or actually all we did was work on here. So I’m $2,795 a month. And I heard you talking about a workbook. Is that part of that or is that extra?
Ryan Rockwood: No, everything is included.
Jacky: Okay.
Ryan Rockwood: Yes, everything is included so you’ll get that. And basically being, you know, an insurance professional you’ll have a slight edge because you’ll – that means you had to pass life as an exam to do your thing and everything, so you’ll be over to jump right in here and get that thing in an hour and get crank and get those forms out.
So, basically what I want for you is to be able to especially – you know basically, when I want those – when those letter and when those calls come to your client, you probably won’t be able to stop those harassing calls. But when you do I want to make sure that you and her are saying to them, “Oh, we’re so glad that you’ve called because we’ve got a loan modification pending with you as of these date and we think it’s going to be getting big here [phonetic].” So, keep so close eye on that – what state are you in?
Jacky: Texas, [Indiscernible].
Ryan Rockwood: Okay, so you want to just keep close eye on that trustee date. I don’t know how it works – trustee sale date or Sheriff’s sale, whatever they call it. In our state, California, once they default – so she defaulted two months ago, she would get – let me do that, okay one sec. Okay, Jacky, I just did this so that everyone could hear me better. But basically in California, we have – you default. Then 30 days later, you get a notice of default.
Mike Rockwood: Ninety.
Ryan Rockwood: I’m sorry, 90 days later you’re going to get a notice of default. Then 90 days later, you get a sale date set, okay. So right off of that, we’re looking at like a 60-day grace period in which you’ve blown two months already. Your client is blown two months.
But the good news is if it’s like California, she still has four months before there’s even the possibility of a sale. So, as long as you keep a good eye on that, on that sale date, and make – don’t ask her. You’re really going to have to get the number yourself and call in because you start real estate business. We have seen houses accidentally get auctioned. And that was during loan modification or short sale process. So, I would urge you make sure you get on direct authorization to talk to your client’s bank so you can call in anytime and keep checking on the sale date and everything else like that.
Mike Rockwood: Ryan, let me make one observation before you move on to the next question. Jacky mentioned that they had already written a hardship letter. And I would advice you, Jacky, be sure to look at that hardship letter and when you’re talking with the lender on their behalf or when they’re talking with the lender, be sure you take a look what it says because like Ryan was talking about, a hardship letter is being easy to write now and he wrote so many last week for so many people.
But here’s an interesting thing that I had happen earlier today with a client. I was talking with a lender on her behalf – and they said, “listen and her hardship letter that she sent you before we were talking to you, Mike, she told us that her daughter was quitting her job and going back to school so she could no longer afford her own mortgage.” And they said, “Listen, we’re not about to pay for her daughter’s college.” And I had to correct them. I said I had to say, “Listen, you don’t understand. She must have said that incorrectly.” What happened is her daughter got lost her job and realized that she needs more skills in order to keep employed.
So, there’s a very slight subtle difference in how you present the same issue that could make – can go from being a valid hardship to be one that is laughable. So, you really have to take a look at the hardship letter that they wrote and see if it made sense because they may already stay on their file, you know, like they did on this person’s, we will not finance her daughter’s college.
Ryan Rockwood: But you know, so that does not make you despair though. Though the good news is that mistakes can be corrected a lot of times, okay, and we do it all the time. The client misspoke. Client must have had that wrong under direct – who knows, really stressed out.
Mike Rockwood: Under direct, yes. A lot of stress.
Ryan Rockwood: Anyway, that’s the good news. So, I’m excited that you are working on this for a client because we do have several people that have done this and started like small businesses helping especially realtors and probably – I think, you said you were an insurance agent. Anyone that knows a lot of people knows that …
Mike Rockwood: That I was a good database.
Ryan Rockwood: And knows that a lot of people need help. So, the one thing I would say though is our kit really isn’t designed for you – I mean, there isn’t really much of a difference but there are a few forms that you’ll need as a secondary individual that I don’t think is in our kit. Is the authorization form in there?
Mike Rockwood: Yes.
Ryan Rockwood: It is.
Mike Rockwood: Yes, it’s in step six of the Black Belt CD.
Ryan Rockwood: Okay. So Jacky, when you get that CD, just a simple form that they’ll fill out and you’ll sign so that you just want to do that. If you just want to be any other steps like that, like if you don’t know – if you’re having trouble putting off a trustee sale in a couple of months or whatever, shoot us an e-mail and we’ll try to give you some of our tips for postponing trustee sales until you get this thing resolved. But good for you and welcome. That was cool. It’s cool talking to you.
Okay, here’s the internet question. “I have a home with three different home equity loans. I have a home in three different home equity loans on other properties. Where do I start?
Mike Rockwood: You got to everything mute.
Ryan Rockwood: You want to take that one.
Mike Rockwood: So, they can hear me just fine.
Ryan Rockwood: Yes.
Mike Rockwood: All right, I always recommend the people start with their own home primarily because the first loan modification that you do is far and away the most difficult one because it involves getting over the emotional hurdle and then the hurdle of getting all your forms together, you data together, and actually taking action. And it is the mortgage that your lender can most, you know, gets compensated most for helping you with.
So, you’re most likely to hit a homerun. So, let that be your first one. You will not believe how easy the second and third and fourth and fifth will become. Wow. Like I said, the last one I did on my own – my own house took me 25 minutes and it was my best one of all. So, that’s how I recommend you prioritize them.
Ryan Rockwood: So, there’s the order. You have the order. However, no reason to not start on the second one until the first one is done.
Mike Rockwood: No, no. What I recommend is that you get started on the first one. But when you submit it after you’ve done your pre-qual call and you submit it, you will have such an increase in confidence and you will have three to five weeks where you’re just waiting around, so that’s when you initiate the others.
Ryan Rockwood: Yes, so you know a great practice would be, do your first one, that’s the big deal. And then shoot for a goal of during that week, you’re going to apply for three other ones. Blast through them while it’s still fresh in your mind, you’ll be able to modify your hardship letter slightly, you’ll be able to modify your budget slightly, and you have to put new account numbers on everything, you’ll have to submit another package. But that’s going to feel like, that’s going to feel great, and once you get those going – now do them fast and getting them cranking.
But you have the order now. And yes, the other thing that I would mention is that we’re getting a lot of calls from people in Florida. I don’t know where this person’s from. But home equity loan even in state like California can be a problem in terms of recourse. There is a potential that your banks could go after you even if you do lose the house, even if you do foreclose it for the ballot. So home acuity loans just a little bit of an extra thing, you want to really stay on top of that and if you have any questions or getting what you feel like jerked around, for sure give us an e-mail, help@60minuteloanmodification.com, okay.
And now I have another one here. Denise asks, “When getting your papers in order, if you have filed for any extension in your taxes in 2008, will I need to complete this before submitting a mod?” Can you talk about that?
Mike Rockwood: Denise, the answer is no. The truth is if your loan modification is all in order and it’s with the major lender who’s doing a lot of loan modifications right now, they are cutting every corner, unbelievable the corners they’re cutting. They may not even ask you to document it. If your loan application – if your modification …
Ryan Rockwood: They may not ask for her tax return?
Mike Rockwood: They may not ask you to send any of your tax returns. You may send in your application. You wouldn’t believe how these guys are cutting corners. So, you may not even be asked for it. If you are asked for it, then you just – we’ll submit your 1099 or you submit your W2s and just tell them it’s pending. Because really if you think about it, they have to take your word for what’s the bottom line is going to be. You know what I mean? What your take home pay is if it’s a 1099, et cetera. So, they may ask you just sign a personal PNL. But there’s no problem at all with not having 2008 taxes done. Next one.
Ryan Rockwood: All right.
Mike Rockwood: I had another – I thought after you mentioned whether, Ryan, you asked whether or not I really believe that having a personal – making a personal connection really makes a difference. And I got two stories really from the last couple of days that I thought of right away and I didn’t get a chance before you went on to the next question.
I wanted to bring to your attention the fact that I called Chase earlier today on behalf of a person who was intimidated about calling Chase. And here’s the person’s story. This person is a guy who is 61 years old, changing careers, earning very poorly, very, very poorly, has an expensive home with only a little bit of equity in it, a big mortgage and he writes a check. He takes money out of his personal savings account every month and pays his mortgage. He’s been doing that for a year and figures he can do it about one more year and figures it’s going to be about three years before his business is up and running well enough for him to earn.
Well, so he was looking at personal bankruptcy at age 62 or 63. He was in dire straits. And this is so common across the country. Well, I dialed Chase on his behalf because he was just emotionally not feeling confident to do it. And I got Chase employee on the line. Thank God I got this person. And I just explained the situation and I said, “What do we do for people like this? He doesn’t have enough income. You won’t approve his loan mod.” And she said, “You’re absolutely right. We won’t but we do have resources.” And she guided me through their website to the forms that this person needed to fill out. And she talked about a program that they have that I think is going to bridge this person’s – I think it’s going to be an ultra low interest rate loan modification for two years. So, I guess what I mean to say by that is …
Ryan Rockwood: So, how were they able to solve the problem if he didn’t qualify for a loan mod?
Mike Rockwood: Well, no, but they will. A traditional loan mod they didn’t and so what I guess my point to you is that you were puing [phonetic] whether or not making a personal connection really matters. But this person went way out of her way to show me what they have for people in situations like this. So, you know, that’s really is a people thing and people understand. People at the bank understand that this is a crisis in people’s lives. And they are looking at losing a big, big portion of their net worth, and like in this person’s case, just going into personal bankruptcy late in life without earning power. So, you got to make those personal connections.
Ryan Rockwood: Okay, how about – we got one from Hesus [phonetic]. “I have a loan with Countrywide. They tell us that the lender, Bank of New York, does not do loan modifications, period. So what are my options?” And he asks, “Is this new BK bill going to pass, and how will it help?”
Mike Rockwood: Oh, good question. The BK ruling is still in congress but everybody is expecting that it will come through the only question is…
Ryan Rockwood: What should back up? Is this the home equity or second loan thing that we’ve been talking about?
Mike Rockwood: No – Yes. Well, what this is congress is debating whether or not to give the judiciary a lot of – it’s a bankruptcy law change that would allow bankruptcy trustees, judges to alter your mortgages based on their best judgment. And a lot of people are advocating for it because the lenders are so clogged with foreclosures and loan modifications that they’re saying, “Listen, at least the people in bankruptcy, let the judges – you know these are intelligent people with objective, opinions, and let them reset the loans.” And a lot of people are in favor of it. And I think it’s going to pass. It’s just a matter of how much power they will give them. And best estimates are that it will pass in the next three or four months.
The Bank of New York not offering loan modifications may be a problem. There are some institutions around the country that have not accepted any money from the federal government. If those are the holders of your note, they can in fact refuse to modify. It’s very rare that they would particularly if you don’t have any equity in your home. So, what I would do right away immediately this evening like in the next 10 minutes, author a three- or four-sentence letter to your lender to Countrywide and say, “It’s my understanding that the owner of my note is not writing loan modifications. It is also my understanding that every institution that has been granted any TARP funding must modify loans, must agree to modifications. Please clarify for me if in fact the owner of my note has not received any funds and truly are not offering modifications.”
And then I would add this last sentence. “I am seriously looking at losing my home if I don’t get this modification.” Then sign it, put your address and return everything, fax it in and then follow up and ask them if they receive it within a couple of days. And then it is a qualified written request. They must respond to you within 20 days. And believe me, they’ll take it seriously.
Ryan Rockwood: Okay so the bottom line, do we have anything actionable that he can do? If his lender does not allow modification – I mean, one thing is many people have – we’ve been told that by many banks who in fact, do modify. To be honest, we just chalk [phonetic] it up to …
Mike Rockwood: Okay, no, you’re making a good point. What would we do if they were running that mod, we would submit it anyways?
Ryan Rockwood: I guess I would want to try to figure out has he gotten – is this a legitimate answer? Make sure you get it a few times?
Mike Rockwood: Yes, oh that’s another route. You might take it and just escalate it. Call back if you get the same answer. Just say, “Listen, I really need to hear that from a supervisor. You know, this is my personal fortune or this is my family home we’re talking about. Would you mind just putting me through to your supervisor?” And then when the supervisor comes on just ask him, “Where do I send this qualified written request? I really need to makes sure that this is the case because this is serious business.”
Ryan Rockwood: Now, I mean there are strategies involving – he knows who the bank. He knows who holds the note and it’s institution. So, that’s a real tough one so I guess …
Mike Rockwood: You know, Ryan, now that I think about; I bet he’s not in default either. And I bet there’s some equity in his home. So, I’ll bet you’re getting jerked around.
Ryan Rockwood: Okay.
Mike Rockwood: And I bet if you push back hard enough and you think of different strategies to get their attention, I bet you’ll get a modification.
Ryan Rockwood: All right. Does it matter the order of my documents when I send documents to the bank? From Jeff
Mike Rockwood: No, it doesn’t matter at all Jeff.
Ryan Rockwood: It’s nice to be neat.
Mike Rockwood: I always like to put them in order that I would like to see them. That’s how I do it.
Ryan Rockwood: Stacking order, yes.
Mike Rockwood: I put a cover letter. Yes, I do a stacking order, cover letter, and then what do I want to see first. I want to see there hardship letter, so that the evaluator can check that off. If you look at the checklists that the bank sends you, that’s a good order. Put it in the same order that they ask for.
Ryan Rockwood: Yes. Hardship letter is a nice thing. I mean huge information pack. It’s like taxes. I put those in the bottom, in the end. I don’t know if you do that. It’s kind of like beyond here, it’s taxes. There’s something like that, you know. Beyond here there’s not a lot of great reading or something like that.
Okay we got Ghana [phonetic] asked, “What things should I consider when deciding whether to take a loan modification or do a short sale from being underwater more than 100K or more?” That’s a good question. So, what thing should I consider when deciding whether to take a loan modification or do a short sale and from being, okay, and from being – I’m assuming that what – said she’s upside down a $100,000 at least. Okay. Let’s just start off by saying; doing a loan modification is – accepting a loan modification shouldn’t be an obstacle to doing a short sale if she decided to do a short sale later.
Mike Rockwood: Correct.
Ryan Rockwood: However, a loan modification can give you some short-term relief, okay.
Mike Rockwood: Yes, it’s a good strategy actually if you can get a loan modification in the near term. And in fact a lot of the lenders are almost throwing loan modifications at people who begin the short sale process and stop making their payments.
Ryan Rockwood: Oh, yes that’s true. We have a short sale client and the bank …
Mike Rockwood: Oh they’ve almost forced the modification on her because they realized they’re heading into a short sale and in the interim they want some money because they don’t want to move the loan over into the pile that is non-performing and then they get all kinds of regulatory problems and they have to answer for it and it goes through another department, et cetera.
So there are a lot of reasons for them to keep the loan active as well. So, and sometimes the short sales take a long time if you want them to. Short sales are really very much in control when you’re doing the short sale in terms of how long they take. So, it’s a good solution. Get the modification then think about it.
Ryan Rockwood: Basically, yes, the way it’s set up here the questions, I could tell she’s thinking about an either/or thing. Consider doing both or – and neither. Well, the loan modification doesn’t exclude the short sale. And I mean the other issue that she brings up is that she’s underwater more than $100,000. So, right now loan modifications, we’re not having good luck getting principal reductions. We have gotten a principal reduction actually. And on my dad’s property, we don’t know quite know how we did it. But we just did our normal thing. And so she’s looking at this thing and she’s thinking should I just get out of this thing or what? Now San Diego’s been devastated, obviously, with real estate prices.
Mike Rockwood: Oh, she’s in San Diego?
Ryan Rockwood: Yes.
Mike Rockwood: And a $100,000 in San Diego may only be 10%.
Ryan Rockwood: Yes, I mean it all depends, right. Is this a $500,000 house or is this a 1.5 million? If it’s 1.5 million, you’re a $100,000 underwater, no sweat. Here’s the question I would put to you. And that is, you know, first of all, get the best loan modification that you can. I think that goes without saying. Then in line with that, I think you have to look at it and say, can I live somewhere else for less money where I would be happy?
Mike Rockwood: Tax adjusted for less money because a lot of people forget – you go to rent and you got to remember your mortgage payment, the majority of it is tax deduction. So, you really pay 25% less than you think you pay.
Ryan Rockwood: Okay. Well, [indiscernible] to that into it and a lot of us did get into situations where, I mean, maybe she’s sitting out of $6,000 a month mortgage and she would be happy in a $2,500 a month condo by the beach, sweet. And in that case, tax obligations aside, you’re just going to be – you’re going to be better off.
So, it’s going to be a good 10 years before San Diego recovers. And I think that should really guide your thinking if you, without stressing yourself out of too much, can happily live somewhere else. Then get rid of that debt. On the other hand if it’s your dream home, if it’s your family home, if it’s with a loan mod exactly pretty much what you paid in rent, there really is no advantage right now to getting out of it. Keep it, keep the tax savings. And like we said in the future, go for that principal reduction in a couple of years when we believe that it will be easier to get a principal reduction. So, keep working from all angles.
Okay, let’s go and take one more call on this one and then we’ll be done for today and back on next Tuesday. Hold on. All right, do we have one more question from anybody? Don’t be shy, one more person. Anybody? All right. Well, you know what, I did answer like probably at least 10 e-mail questions. So, anyway, I guess everyone’s got their questions answered. Super, we solve the world’s problems. Thanks so much for joining us tonight guys. Good call. I hope you guys benefited.
Mike Rockwood: Yes, it was a good call. And then we’ll be back on Tuesday. We will cover chapters. We’ll get back to the workbook and we’ll go talk about some of the other tools that we got. But we’re really diving to the application on Tuesday and on Thursday. We’ll get through the hardship letter, the budget, and our recommended follow-up procedure. So that will be a strong couple of calls next week.
Ryan Rockwood: Okay. We’ve had a really busy week with lots of interesting clients. Many of whom are getting really amazing results with their own loan mods. To give you an example we had a guy here in California lock in a 4.5 fixed rate for 30 years. Now that’s absolutely sweet and recalled, this is not a refinance at today’s rates. It’s basically a free refinance. We had a gal in Florida. She lowered her monthly payment by $330 a month. And one of our clients in Northern California knocked his second mortgage down to 3% fixed for three years.
So, I just throw that out there because one of the main advantages of being part of a group like this is that when you come to negotiating, you want to know what other people are getting. Okay, so that you can judge whether or not you’re getting a good loan modification.
So, congratulations to all of you who are taking action and getting success. To those of you, who have not yet started, stop waiting around. This is not going to get any better until you take action. If you don’t already own our 60-Minute Loan Modification course kit, do yourself a favor and buy it now. It’s the greatest bargain you’ll find anywhere. And time and money you’ll save using our resources will repay your small investment many times over, plus it’s guaranteed.
If you already have our kit, I really hope you’re taking action and moving forward. If you’re not, give us an e-mail and tell us why you’re stalled out or what’s stalling you out.
Mike Rockwood: Yes. Confess.
Ryan Rockwood: Yes, we’re trying to – yes, that will be a giveaway for this week. We’ll call you up and kick you in the butt.
Mike Rockwood: Berate you.
Ryan Rockwood: Yes, and get your pass whatever is blocking you.
Mike Rockwood: You think those collection people are harassing? Wait until you hear about your loan mod guy call in, following you around, garnishing your wages.
Ryan Rockwood: No, don’t worry. Okay all of our members have unlimited e-mail support. So, please take advantage of that and let’s get our loans modified. Visit www.60minuteloanmodification.com for all the details or call us 310-634-0362. That’s 310-634-0362. E-mail is always the fastest way to reach out. So, since we’re on the phone all day, e-mail us at help@60minuteloanmodification.com. Thanks and have a great night.
