Do any of you out there charge distressed homeowners a fee for loss mitigation services? I realize that your ability to secure their home as a short sale prospect or to even be able to do an equity purchase is payment enough. But, in cases where they just want your help to act as a liaison with their bank and help them do a workout perhaps… do you charge for this? I hope I’m makings sense. Thanks for any comments.
From what I heard over the last 2 weeks, I was told not to pay a penny up front to any company that wants to be a middle man. I guess the “up front” is key…if they charge a fee that is negotiated with the lender and they get paid by the lender, then I would say they are getting paid for a service and all is good.
yes you can put a mitigation fee up to $1,500. this will also reduce the payoff to the lender.
You wont get it from the seller direct as most don’t have it, but if you are not being ht einvestor in the deal i.e you are not taking ownership and reselling after the short sale, then charge a fee at closing.
We include a mitigation fee in all our packages and it reduces the payoff to the lender.
to answer your post.
When we do a forebearance for a client we charge $450 up front which is held in escrow, if the deal goes through we get paid an additional $500, if the deal does notgo through then we return the escrow money less $100 for paperwork etc.
I suppose it depends if the investor is trustworthy or not. Client should check to see if they are members of the Better Business Bureau before parting with any information or money.
always work with integrity.
GQ: Do you ever have clients who have an issue with paying $950 for help in getting a forebearance or are they just happy to have a reprieve with the lender? Thanks for your comments.
I charge $200 to do a forebearance or modification. I screen the client first, to see if they’ll qualify. If they don’t, I tell them straight and explain the alternatives.
Even if they do qualify, 80% of homeowners in foreclosure don’t get out, or go straght back in. Guess who they come to when that happens? The guy who helped them the first time.
Foot in the door.
My understanding is the fee usually is the amount of one monthly payment. Should a person pay someone to arrange for a new and hopefuly lower payment depends. From what I’ve been told alot of lender loss mitigation department rep’s have closed minded and only are only wanting to know whne they can expect payment. Those wishing to continue along these line of thoughts can share whatever experience they’ve had.
we think 950 is a fair price.
It is all about ability and intent.
If you were losing your home would yo upay 950 to keep it or just let it go?
I have no problems with clients and we are now doing between 15 and 18 a month.
I also have a great mortgage broker who will try get htem refinanced first.
if the forbearance is not accepted I will also try a modification.
Green Queen: Thanks for all your comments. What market are you located in? Have a great weekend!
I KNOW HERE IN IL
YOU can’t take any money from the Homeowner, for helping them out in a work out plan…
I know people and mostly out of state companies charging $500–$1,500 to do work out programs…
I am like WOW!! thats a lot my God , I pay a Short Sale Company $1,000 fee for doing unlimmitted Shortsales that I give them!!
and its worth every penny
But a $1500 to do a LM case whewwwwwwwwww thats alot…
In California: they may try to call you a Foreclosure Consultant (Civil Code 2945) : be careful.
The risk far outways the benefit. In most States it is not legal to charge a fee. I charge the Realtor or Investor to do the Short Sale. I don’t deal with the Home owner at all. And we do 500 a month.