Recorded live
Tonight’s call was “Open Microphone” Questions and Answers
Transcript of the call!
Mike Rockwood: Issues and dealing with your questions, and you can send the questions to us at questions@60minuteloanmodification.com or if you’re watching us live on the Internet, you can just join in the chat and deliver questions by chat, right Rocky?
Ryan Rockwood: Yes, you can. It is a little wonky.
Mike Rockwood: Not as good?
Ryan Rockwood: It not always works but the way they access the feed online and to participate there is through 60minuteloanmodication.com/live.
Mike Rockwood: Okay, so that’s 60minuteloanmodification.com/live. Okay, I’m Mike Rockwood and along with my business partner, Ryan Rockwood, we are your hosts tonight and we deal with all sorts of foreclosure topics. Our 60-Minute Loan Modification site, by which many of you got to this broadcast, really is the premiere Do-It-Yourself Loan Modification Kit in the industry today. We’ve been advocates of loan modifications as the primary workout vehicle, workout solution that is available to homeowners today. So that’s kind of been our bread and butter for the last couple of years. But of course, working in loan modifications gets you into short sales like crazy. So we do short sales throughout the country, we do deed. We help people think through and work out the whole deed in lieu of foreclosure process. We help people work out settlements with their lenders. We do virtually all ten of the foreclosure options that we teach about in our Notice of Default Handbook. We’re involved in helping homeowners throughout the country think through those issues and work them through, so all topics are — it’s open Mike tonight. We’re just going to work on questions.
Ryan Rockwood: You know, that’s not to say that we just do whatever. It’s just to say that it really is imperative to remember that you can’t just go around promoting one solution like loan modification in that every tool and workout is appropriate, just not for everyone at the right time and at the same time. So -
Mike Rockwood: Right.
Ryan Rockwood: – be that as of me.
Mike Rockwood: While Do-It-Yourself Loan Modification might be right, it might be really right for another person to hire somebody to do the loan modification. The same person might also want to concurrently, which is what I often advise, put — have the home, have the property up for short sale. But you know what, a lot of the logical thinking, a lot of the preparation, and a lot of the critical issues that you have to face in thinking through even bankruptcy or just walking away from the home, they’re all the same. I mean, let’s think about it. You have to think about your equity position in the home. You have to think about your vulnerability to deficiency judgments. In other words, are you going to be held liable for any shortfall on a home if you turn it over to the bank and they sell it for less than it’s owed or if you short sell it? You need to think about the tax consequences, and you need to just figure out your own finances and how you’re going to make it through the foreclosure process.
So really the issues are always the same and very often we’ll advise clients to head down a couple of paths simultaneously because you’re not always in control. You don’t always know for sure what your outcome is going to be. You might think you’re a very, very good candidate for a loan modification only to find as you go further and further into the process, you begin to let it sink in, you begin to realize that in fact maybe it will be better to just get out from under this debt and so you wish you were in a short sale situation. That’s very often the case actually.
So today we’re going to deal with questions. But before I jump into questions, I did want to highlight a little bit about loan modifications. I see there is a lot of press today about a lot of folks just waxing eloquent about the Making Homes Affordable Loan Modification Program. Whether or not it’s working, for some or whatever reason, it was a series of “experts” who ventured their opinions today, and it generated kind of a flurry of blog and forum entries and people speaking up about the success. So I’d encourage you if you are interested in that topic, loan modifications in particular. The Making Homes Affordable Loan Modification Program, go ahead and Google some of those and you’ll get some really varied opinions. That’s what struck me today.
Ryan, I didn’t talk to you about this but there were experts who came out in fully endorsing the program, talking about how it, without a doubt, has been instrumental in stemming the decline in the housing market prices by keeping people in their homes and allowing homeowners to have more time to work on a foreclosure workout. There were just as many experts who said that it’s been a total waste of money and most of the money has not, you know add up the bargain, but how few have really got the modifications.
Apparently, most people are in agreement that more than 5% and less than 7% of the applicants have gotten loan modifications. It’s really pretty pitiful because it has been, gosh, nearly — well, the Obama program has been announced. It was announced almost a year ago. Really, prior to that, we had about nine months of modifications going. So it’s really kind of pathetic but it’s all very understandable because the banks were given an awful lot of resources and found other things to do with the money. I mean, we all know and we’re all angry and we all feel ripped off. I know you don’t need another political pundit, but we all feel ripped off that the banks didn’t use that money for modifications and helping to stabilize the housing market. Instead, they went globally and invested it and earned enough to pay off the tariff funds so that they don’t have to march to the administration’s drummer any longer.
But anyway, it’s kind of interesting to see that there are pros and cons and certainly I got to think that the truth is somewhere in between that probably the Making Homes Affordable Program, unlike it’s predecessors, has probably had some impact. Certainly for the nearly hundreds of people that we have worked with and over 120 mods that we have actually done for our clients, it’s really been a God sent. Some of our clients got reductions in their monthly payments of 300 to 1,300 dollars per month and that can really change things for you in terms of just a month-to-month pressure. So we believe that the program has been successful and we kind of look forward to at least six more months of using it to help our clients and help all of you get good modifications. When I say using it, that’s exactly what I mean because if you are street smart, if you’re really paying attention to what’s going on, it’s really not so hard to use the program. You just have to play by the rules and you have to be street smart enough to get out of line and get up to the front of the line and understand what it takes to get your modification through quickly.
All right, so enough said just on loan modifications. We’ve already got a bunch of questions that had started to come in before we’re broadcasting. I’ve got half a dozen of them here. Should I start or do you want to -
Ryan Rockwood: Yes, go ahead.
Mike Rockwood: Okay. So I’ll just start. You just interrupt me, Ryan.
Ryan Rockwood: Well, you know, did we give enough of introduction for someone who has never been here?
Mike Rockwood: Probably not. Go ahead.
Ryan Rockwood: My name is Ryan Rockwood. This is my dad and my business partner, Mike Rockwood. Basically, way this all started was from personal experience where we found ourselves in a situation, but we needed relief. Well, I’m really telling my dad’s story, not we. He did a relief on his mortgage, called the bank, and they weren’t willing to work with him. Long story short, he just went accept “no” and ended up finally getting a loan modification. But after probably six months of working at it, but the savings were huge, it was a big deal and he wrote a book about his experience because the hurdles were so dramatic. It’s kind of like no ordinary human could get pass those rules.
Mike Rockwood: Yes. Most people would have been just blown off.
Ryan Rockwood: It was just astonishing. So now, many of the hurdles have changed.
Mike Rockwood: Yes, that’s true.
Ryan Rockwood: In some ways, it’s gotten easier. In some ways, it’s gotten harder. But then the book has changed along the way too. So what this community, what this kit is all about is trying to bring people a low-cost way of getting a loan modification. So if you’ve arrived at this site and you don’t know who we are, we have a kit that is priced certainly within everyone’s reach. So please go ahead and purchase that. Also, we have some other products too that we may have mentioned. But welcome to the call, we do this every Tuesday for clients. If you have purchased the kit, there is another class like this on Thursday. Okay. Thanks so much.
Mike Rockwood: All right, so every Tuesday our lawyer really encourages us to remind all of you that we are not lawyers and we are not CPAs, we’re not tax advisors. We are in fact realtors, and we are in fact very experienced in the foreclosure business, and we are in fact like experts in loan modification and many other workout solutions. But what we pass on to you is just reports of what other people are doing. It may or may not be appropriate for you and it may or may not be legal for you. Whether or not, what we suggest is ethical to you is your business. That’s your choice. But hey, Ryan and I are kind of fiddling around with this book. You may see and we’re kind of pleased with it because it just came in, and I see it does need a few more improvements, Ryan, but it’s the prototype for the most recent edition of a book that Ryan wrote called Mia’s Home.
Ryan Rockwood: Well, no. I think it’s perfect. You can’t get rid of that.
Mike Rockwood: Yes, but you can’t get it over here. You know what I mean? Because that just doesn’t look right.
Ryan Rockwood: Yes.
Mike Rockwood: But anyway, Mia’s Home, if you’re familiar with it, is a children’s book because we so frequently saw that we knew the family is struggling with financial problem, struggling with short sales with thumb, losing their homes, or even working through modification. There’s just a lot of anxiety in the home. So Ryan wrote a book — in conjunction with a friend of his who is an artist — wrote a children’s book to help parents talk to kids about these tough financial issues and just reassures them about the family that we’re having trouble but we’re sticking together, it is going to be okay, we’re going to make it through, we’ve done nothing wrong, we’re not going to get caught and hold off to jail. It’s really a great story and parents really report that it’s very, very useful. Well, why we like this edition so much is that it is now same book, flip it over, and it’s a Spanish version. La Casa de Mia. We’re very, very pleased with that because so many of — so much of the population of the big foreclosure states like Arizona, Texas, California, Nevada, Arizona have such a large Hispanic population that we’re hoping that this is going to help a lot of people. By the way, there are some real fresh endorsements for this book that I personally and very gratified by Moe Anderson, the Vice Chairman of the Board of Keller Williams Realty endorsed it; Judith Cousins, who is a children’s book author; Conrad Ricketts, who is an Emmy Award winning executive producer, he’s the extreme makeover guy; and Johnny Wilson, who is part of Habitat for Humanity in Georgia, endorsed the books. So it’s a great book and you can get it on our website as well and it comes with the 60-Minute Loan Modification Kit.
All right, some of the questions. The first one that I got this evening was from Tina and she said, “How long will it take for my credit score to recover from 4 to 5 mortgage late payments?” I think she asked that specifically because that’s usually what it takes in a loan modification. Let’s be frank, you can’t really get a good loan modification in less than four months unless you’re in default, unless you miss a payment. Most people end up missing 4 to 5 of them and that depending on how many credit lines you have, trade lines, can mean as much as a 50- or 75-point decline in your FICO score. So if you are so proud of your 750-point score, you might just drop down way below where you like to be down into the 675-point range. It will take you — it would take under normal circumstances — probably a couple of years to recover from that. But in the book I recommend seven what I call credit repair habits that help you to speed and to recover much faster. Those credit repair habits are things like double paying — paying twice a month — establishing passbook savings accounts and using those passbook savings accounts to establish new credit with the passbook savings loan that gets reported payments on which you get reported to the credit bureaus every month, some really intelligent ways to ensure that you never make a late payment again. Then of course the old standby of piggybacking on a good friend’s credit rating by cosigning on one of their accounts. So there really are in total seven of them. And I’ll go into great length to explain how to implement them. So Tina, realistically 4 to 5 mortgage lates will probably take you 6 to 12 months to recover from if you get really aggressive about it. It just can’t happen faster than that. That’s just reality.
Mark says, “I owe back homeowners association dues of over 4,000 bucks and in my short sale, which is on the market now, will the lender pay these off or am I stuck with them?” That is a real timely issue because for the first time in my — I don’t know how many short sales I have done in the last two years but I bet it’s — let’s see — I bet it’s probably not 100. It’s probably more than 75 and less than 100. I have not ever had trouble getting the HOA dues to be paid, but this past — two weeks ago I did have. I ran into trouble and Bank of America simply, for whatever reason, would not pay off the homeowners association dues and I could not get the association to waive some of the dues. So in fact, we have to strike a deal and I was very pleased that the buyer came in. So Mark, the answer to your question is most of the time and it’s up to your negotiator to get that in and make sure it’s in on that HUD-1 that gets submitted with the application.
Rina asks, “Why don’t you recommend that people record calls on their mods?” Okay, here what she says, “You can transcribe them and then you have a great record and prove some of the strange things we are being told by these banks.” That’s not what she called. “I started doing this,” she says. Rina, I think that’s a great idea and number one is that it sounds like a little cumbersome to me because sometimes those conversations go on for quite a bit. But if you do transcribe, and that’s great to have that kind of a record. In terms of being able to prove anything to them, I wonder though, I mean it’s not like the banks don’t know that their front line representatives are undertrained and underpaid apparently and that they’re inexperienced, so I don’t know what you’re going to prove when you do — if you do run into a real bad apple and you really have a problem. You got this really wrong information and you escalate the problem to the manager or a supervisor. I mean, they’re not really interested in you proving that their employee is poorly trained or misspoke. The legality of having recorded and transcribed that conversation, I’m not so sure that’s going to be really useful to you either because at the end of the day even if they said one thing and later didn’t come through on it, if you haven’t got it in writing, it’s really not probably — you probably can’t enforce it. To top it all off you may not be — depending on what state you’re in — wherein you may not be in a state where it’s even legal to be recording that conversation without notifying both parties. So I think there are some problems with what you’re doing, but what you’re recommending that people keep really good records is a great idea.
Molly asks, “I’m evaluating my loan experiences based on your questionnaire.” Let me explain that. When people ask us to help them with their loan modification, in other words they decide not to do it themselves and they hire us to do so, we interview them to see if they’re a good candidate to get a modification, and then we send them a packet of information that the list is a bunch of responses from them about their loan experience and that is because we do a forensic loan audit on every one of our client’s loan experiences based on — you know, it’s not a full-blown audit of every consumer protection law and every RESPA statute, in every Truth In Lending Act statute, but it is like about a 10-point forensic loan audit, and she says that our questionnaire got her thinking about her experiences. She asks, “How do I know what the best interest rates were at the time of my closing?” Because one of the violations is that in fact sometimes lenders switched at the very end and gave you, in fact, a loan at a slightly higher rate than you had anticipated and some people don’t know about that until closing. So you’re right there and all of a sudden the loan is a quarter of a point higher than you thought it was going to be. Sometimes they get compensated to do that through a Yield Spread Premium. So Molly is evaluating that situation and suspects that maybe that was the case. So she asks how do I know what the best rates were on that day, and here’s my advice. You go to erate.com/mortgate_rates_history.htm. That will bring you up to a page and you just merely need to enter the date of your closing and it takes you to what the historical rates were on that date. If yours has — if you had a good FICO score like if you had over a 720, Molly, and you find that in fact you did not nail that best rate, then you have to make note of that and use that in your loan modification application, all right. Ryan, you have some questions you want to take?
Ryan Rockwood: No.
Mike Rockwood: Okay.
Ryan Rockwood: Sorry, I don’t.
Mike Rockwood: I’ll just keep rolling. Ken asks and this is another forensic loan audit question.
Ryan Rockwood: I should say questions@60minuteloanmodification.com.
Mike Rockwood: All right. Ken asks whether or not he needs an attorney to use the violations that he knows happened during his loan modification. For those of you who may not be really familiar with what I’m talking about, a lot of the loan modifications these days are turning a little bit nasty and because a lot of our clients and a lot of people are trying to get out of line, get to the front of the line and get that mod, so a lot of them are turning to forensic loan audits and that is a review of the loan process to identify violations of any kind of law: Consumer Protection law, Real Estate Settlement Procedures Act laws, Truth In Lending Act laws, or even out-and-out fraud or discrimination. So when we do find those violations, and this is getting to the heart of Ken’s question, what do we do with them?
What many people do, if they’re pretty serious violations is they will go to an attorney, retain an attorney to help them with their modification and most attorneys that will work in this area will do that for $2,000 to $5,000. That’s a little bit pricey, except that you keep in mind that some of our clients are dealing with 1.2 to 2. — I think the biggest mortgage that we’re working out right now is like a $2.7 million mortgage. So in the scheme of those kinds of things, it’s not so much money. But for most people who have a $120,000 to $220,000 mortgage who, and you know your relief and your modification is only going to be $600 a month, you hate to spend 2,500 bucks for an attorney to help you pursue that. So what we are doing routinely on our mods, and I recommend that people do this is I craft a letter. I don’t try to act like an attorney. I’m very transparent about it and I write to the legal department at the same time that I’m submitting the loan modification.
So here’s what I recommend, Ken. Write a letter. Explain that you are applying for a loan modification and that you are disturbed by the following information and then you tell them the information that you have uncovered and you say, just explain that you have read that in fact these violations are violation of your right and may have hampered you and put you into a loan that put you at risk of losing your home and of defaulting and hurting your credit. So what you’re explaining to them is that you understand that these violations, you understand that the whole basis of any of those suits would be that you suffered some ill consequences. So you state the fact that you know there were some violations or you suspect that there were some violations, you understand that the reason they would be interested in that is because it may have caused you harm and that gives you a ground for suit against them. Then what I’d do is I’d just ask them to please investigate. So you hit them with a ball in their court and let them work it on their nickel. I submit it as a Qualified Request to the legal department and then I attach it to the loan modification, and that goes to Loss Mitigation Department as well as the Customer Service Department. That Qualified Written Request, of course, I sent as in certified mail.
Now I’ve used another term that we haven’t used for a few weeks and that is the Qualified Written Request. For those of you who are new, let me explain what that is. Section 6 of the Real Estate Settlement Procedures Act guarantees you a communication deal between you and your lender and here is how it works, it guarantees you that if you submit a question in a Qualified Written Request, QWR, that the lender is obligated to respond to you within 20 days that they have received the request and within 60 days with a full response to your query. I’m sure there are a lot of ways around that and a lot of ways that they can pacify you, but honestly my experience is that they take it very seriously, and usually I get that response that they received the letter prior to the 20 days and invariably I get a full response within 60 days. So use a Qualified Written Request and you can go to our website. I think there are articles. If you go to the articles section, search for an article on Qualified Written Request or simply Google Qualified Written Request, QWR, or e-mail me for my suggestion for a format to use in any Qualified Written Request, all right?
Another related one to forensic loan audits comes from John and he asks which violations are significant and which one gets the lender’s attention? That’s always a real popular question because everybody wishes that I could just tell them the four or five violations that are most important. In my upcoming book, Do-It-Yourself Forensic Loan Audit, I do highlight the ten that are the most common, but here’s what I become convinced of. It doesn’t matter if you have three or four minor violations or you have one major violation. What really matters is that you use the information correctly. You really have to follow a really intelligent process for using the information. Otherwise, it really falls on deaf ears. It’s sort of like, well if you remember Gavin Harris who was with us on one of these teleconferences from De Novo Financial Solutions, who is a company that we highly recommend for full-fledged forensic loan audits, he put it this way. A set of golf clubs in his hands are not nearly as effective as they are in the hands of Tiger Woods. In the same way, violations that you find may not be nearly as effective in your hands. I can help you and my upcoming book will help you get pretty darn effective at using it. But honestly when push comes to show off, the legal violation is really the realm of an attorney, is really the realm of lawyers. If you really have a claim and you need that claim to get the modification that will keep your home, then you should hire an attorney to get that for you.
All right, that question we’ve already covered. Okay, what do I need to do — is that Renee — says, “What should I do before I contact my lender?” Of course the lenders are always saying call me, call me. The government is always saying call your lender, call your lender and sometimes the lenders will refer you to non-profits who will help you prepare to talk to your lender. That’s all well and good but I really have to advise you to think about it. Would you just dial the IRS to ask them how much money you should send it when you’re reconciling your taxes? Yes, you want to talk to your lenders. It’s very important to talk to your lender, but not until you get ready. The lender has all the information, knows what all your options are. The lender holds all the cards and you are about to negotiate with them. Why enter into that negotiation until you at least, to some extent, level the playing field? At least get better informed. So I recommend that you do the following.
The first thing I recommend before you contact your lenders is go to my website 60minuteloanmodification.com and order the free, that’s right, free CD that tells you my story. The reason that I recommend that is because a lot of people just find it kind of confidence building to hear about how I handled six loan modifications, how I got six loan modifications, and how I saved myself by half a million dollars. So that will be encouraging for you.
The second thing you want to do is move any money out of — if you have any savings or CDs with the bank that you’re going to be negotiating with — I want you to move that money out of that bank. You have to trust me on that one. They have a right of offset. Unless it’s a trust account or unless it’s funded by money from social security, they have a right to take that money if you miss payments. So don’t think they won’t. It happens all the time. Don’t doubt it. Move that money. I would not close accounts. It’s never smart to close an account. But if I had $5,000 in the Bank of America and I was about to negotiate with them on a loan modification and I fully intended to go late to get their attention and to get them to negotiate with me, I would move 4,900 of it to an account at Wells Fargo. Of course, I just used those. I just picked those names out of the air.
The third thing that I recommend you to do is you have to make sure that you have an acceptable hardship. Think about what is the hardship that’s causing you these problems. Did you lose your job? Are your hours cut back? Did you not get a bonus this year? Are you not getting the same commission [Indiscernible] [0:30:26] do that you normally do is your spouse, spouse’s income down. What’s the problem? Are expenses up? Is your mortgage payment up? Is the kid’s tuition increased? Has your taxes increased? What’s changed? Has there been a death in the family, a divorce? What is the hardship? You have to make sure that you’re really clear on that because applying for a loan modification or applying for any workout assistance without a bona fide hardship is dumb. You’re just not going to win. So that’s the third thing to do.
The fourth thing is also absolutely critical. Don’t think about calling them until you do your budget. When you have your budget fully laid out, naming all your debts, all your cash flow in the month, then there are three important ratios you need to — or three important items you need to look at — your front end; debt-to-income ratio, which is your first mortgage payment, the first payment, the first mortgage; principal interest tax insurance; and homeowners association, it must be at least 31% of your household income, gross household income. If it’s not, don’t think about it. Now, work out solution. Second, your back end, all your debts added up divided by your gross household income. It must be under 70% or else you lose. If you have more than 70% they’re going to say, “Yeah, you know what? You have debt problems. You’re not going to make it.” The third factor is your cash flow. At the bottom of your budget, it should be a big [Indiscernible] [0:32:11]. You should spend all the money you make. If you have all kinds of excess they’ll say, just like they said to one of my clients today, “You miscalculated. You have $600 extra every month.” Stamped it with a big DENIED. If you’re too short, they’ll say no. You can’t keep up with it from a cash flow. You have too many expenses. Your costs of living are too high. You’re not going to be able to make it sold. Our advise to you these days is a big [Indiscernible] [0:32:40] down at the bottom.
All right, so when you’ve done those four things, now call your lender. So realistically, I mean from the time you decide you’ve got a problem and you need help and the modification or some workout solution with your lender might be the answer, those four things, certainly they’ll take you a couple of days to do, but they should never take more than a week. So it’s not like I’m encouraging you to keep away from your lender but I am saying, boy you have to be prepared. So get it all prepared then call the lender. Now, you’re equipped to answer their questions because think about it, now you know that the reason they ask you those questions is they’re trying to mitigate their losses, not yours. So they’re asking that information in order to use against you. The mini Miranda that they read to you or that is read to you by the auto-attendant, “We’re a debt collector. Any information we gather from you, it is going to be used for that purpose.” That’s what that’s all about. They’re warning you that anything you say, it’s recorded and they are going to try to use it against you so you have to know what you want to divulge to them so that it can be used for the purposes that you want it to be used.
All right, here’s a question from Nina that says, “Why do I have to miss a payment to get a modification? My lender says that that’s not true.” Well, nah, nah, nah, nah, nah, nah, Nina. “My lender says that’s not true.” Well, technically it’s not true and of course they don’t want you to miss a payment. They have a whole department now mandated by the government called Imminent Default. All these people do is run around trying to keep people from missing a payment. However, the thing they don’t do in order to help you, prevent you from missing a payment is give you a good loan modification. It’s so frustrating. They run around and they say, “Oh, you know is there any way you could borrow enough? You know it’s tomorrow. It’s tomorrow. Is there any way that we could — let’s do a check by phone. What are we going to do? What are going to do? This is going to look bad on your credit score.” Well, holy Molly. You guys would have spent as much time and effort hiding from this whole program. If you would have spent that much time and effort just investing in it in helping people who deserve it to get really good modifications so they wouldn’t have to be back harassing you again six months later, we all would have been better off. So Nina, they say you don’t need to go late and if you really love your FICO score so much that you don’t want to, then go ahead, feel free, have at it. But I got to tell you I’ve got a really bad experience in that regard. For two years now I have only one experience of a person getting a good loan modification and not going late on their mortgage. Okay. It took them a long time. Who knows what they would have gotten if they had gotten late? They might have gotten twice as fast and twice as good, so it’s just not — I don’t advise it but it’s your call. It’s your FICO score.
All right, here now. Al says, “I’m currently attempting to sell short. Should I do a loan modification instead?” Well Al, I certainly don’t know but if you want us — it all depends if you want to save the property, if you want to keep the property and that’s an important strategic decision you need to make upfront. Here’s a way Ryan and I always counsel people in this regard. You have to live somewhere, right? So if in your neighborhood you can rent, let’s say for $1,000, and your mortgage payment is $2,000 then what we always say is as a guide, let’s work for a modification that is close to that $1,000. Otherwise, you may be foolish staying in the home if it’s very, very upside down. Let’s say it is $100,000 upside down — 20-year 25% upside down — not really likely to regain that value certainly not in 10 years. So the decision then is housing costs. Remember you get a tax deduction for the interest paid on your payment. So if you would normally pay rent of 1,000 bucks, if you can get your mortgage modified down to about $1,100 or $1,200, then it seems reasonable to stay in the home.
So Al, that’s what I would suggest. If you go through that math and you think, “You know what? It seems reasonable to try to stay in this home.” A lot of people just prefer to stay in their home because the kids are in school, it’s near work, and you’re comfortable there. Moving is such a hassle. So if you decide to try to modify instead, go ahead and begin that process. While some of the lenders figure it out and preclude you from doing a short sale application and a modification application at the time, keep in mind that the short sale application process doesn’t actually start until you have an offer. So a lot of times you’re on the market for 30 to 60 days before you even get an offer. So very often I’ll recommend to clients that they pursue both and then of course you don’t tell the lender it’s none of their business that you’re pursuing a short sale until you have that offer. So you’re pursuing your option for a loan modification while also getting out in the market and getting that offer. So that if the loan modification option does not work out after six weeks or eight weeks, then you’re ready to step right in with an offer and go to the bank with an application for a short sale.
Remember you can rely on us to do your short sales throughout the country, and the way that works is we do the negotiations with the banks because we’ve gotten so efficient at it, so good at it. We do it for people in Florida, in Minnesota, in Massachusetts, Arizona, Nevada, California, and of course we love the ones in California the most because then we also act as the realtor. But when we do like in other states, we contract with the local agent to list your property and we run the bank negotiation. So we split that listing commission 50-50 with them. You get the benefit of our expertise and local expertise in terms of getting a buyer. So it’s kind of win-win-win for everybody. Remember the bank pays for our services and pays for the listing agent. It pays just about everything.
Ryan Rockwood: Also, we have a credit card, a new Credit Card Cure Co-Op that we have and you can see it by going to cc.ryanrockwood.com. Not a lot to look out right now but it’s growing every single week, and tomorrow we’ll have our next live class. So if you have any credit card debt, well I guess probably anything over $2,000 that is really just a burden for you financially, it’s worth looking into eliminating that through settlement. Basically, we’re trying to do for credit cards what we did for loan modifications and that is instead pointing you to a big lame organization that’s going to waste your time and take all your money. We’re teaching people how to do it themselves for basically 20 bucks a month and you can stop/start any time, do that kind of thing. So anyway, check that out. For sure join, if nothing else, join the — there’s a forum just beneath this video that you’re watching. You can sign on to the interest list but I got to say I’m not great about contacting the people in the interest list, so it’s far better if you just go to the website cc.ryanrockwood.com and sign up and see if you like it. Each week we’ll release more information that will get you on the right path to settle your debts.
Mike Rockwood: Okay, I want to take this question as well. We haven’t got that much time left, but…
Ryan Rockwood: We’ll just take one more and then wrap it up.
Mike Rockwood: Okay. Lily asks why it seems that we’re just getting no for an answer from IndyMac when it seems like we’re a perfect candidate for making Home Affordable Modification? I got to say this is not unusual, Lily, and there are several reasons for it. Sometimes we submit applications for a modification that look like they’re textbook perfect. In fact, I have at least three clients right now who are in this situation where we have submitted for them textbook applications. They’re just perfect for the program. They get denied for mysterious reasons. In other words, the representative never can explain it very well and that’s not unusual. Can you get a [Indiscernible] [0:41:55] list? Oh, there we go. It’s not so unusual that their representative can’t explain it so well because a lot of these representatives are: Number one, inexperienced; number two, poorly trained; and number three, poorly compensated. So they’re just, shall we say, not the sharpest tool in the shed. So it’s not unusual they can’t explain it but it gets really frustrating when you call back several times and nobody can explain to you why you’re getting rejected, but they all try, and they all give you incorrect information. You know they say, well you got rejected because your debt -
Ryan Rockwood: You know, maybe they’re just hoping you’re going to go away.
Mike Rockwood: Yes, to some extent they just hope you go away but they give you these lame reasons and it’s very frustrating because you know they’re just flat out wrong. So then finally you ask for a supervisor, and then ultimately, and Lily this is the process that you’re going to have to go through is you get to a supervisor, and I know Lily has actually already done this but what we’re going to do next is send a Qualified Request that I referenced earlier in this teleconference and we’re going to ask for a specific written response as to why our modification does not qualify for the Making Homes Affordable Program. I got to tell you I’ve done this several times and often when push really comes to show off, in fact you do qualify. But in fact you may have been targeted for who knows what reason as being a person who will cure their default by their own means, either you’re in a high-priced zip code or because of your past earnings from your taxes which they have access to by virtue of the 4506 T that you signed.
So whatever reason, they use statistics to determine that you are and identified and triaged you out into a group that they’re going to try not to assist. You know what I mean? They triage into a group that they try not to assist because they’re going to not default on their loan and not go to foreclosure even if they don’t help them, and then they treat the other third is the group that’s going to go into foreclosure in default any ways even if they help them. Then the ones in the middle are the ones that if they help them, they can keep from going to foreclosure and keep those loans current, keep them as performing assets. Those are the ones they work with. So very often I think that’s where we get trapped and we get statistically triaged into this group and it takes some real arm twisting to get yourself out of that group and the Qualified Request is your next step. So you write a Qualified Request very specifically asking that question, why [Indiscernible] [0:44:44] don’t I qualify? I think that will force the issue. At least they’ll force you to the next level.
All right, this has been the foreclosure doctor. It’s Mike and Ryan Rockwood. You can find us at 60minuteloanmodification.com. Thank you for your questions and thanks for the opportunity to help people. Good night.
