I'm here to STEAL your HOUSE!

Foreclosures, Short Sales, Tax Foreclosures
1

How can you come across to pre-foreclosure sellers as honest when you have to use the same invasive tactics (i.e. public records; blind mail-outs; intrusive door-to-door; offensive “bandit” road signs) to help them solve their problems when there are so many sharks out there? Assuming, of course, that you ARE honest…how best to avoid the negative connotations of the “I’m here to Steal Your House” folks?

I’m here to STEAL your HOUSE!

If you’ve ever been in foreclosure or stepped to the kitchen table of someone who is going through the process of pre-foreclosure to help them work out their option=== and seen all the marketing messages that flood their mailbox=== you’ve seen this attitude in action.

Here’s the question…

I want to know what works for everyone else and I’ll happily share what has worked for ultra-successful investors I know and have trained with.

How can you come across to pre-foreclosure sellers as honest when you have to use the same invasive tactics (i.e. public records; blind mail-outs; intrusive door-to-door; offensive “bandit” road signs)?

How do you let them know you are there to ethically and legally make money and that you can do so by help them solve their problems when there are so many sharks out there?

Assuming, of course, that you ARE honest too…how best can we avoid the negative connotations of the “I’m here to Steal Your House!” folks?

Lets all share what works for us, what doesn’t work, and see how we can create more wealth through creating win-win scenarios…

I’m already loving this forum!

2

There’s probably a way to put this back onto the same post but I can’t figure it out! Anyway something just occured to me…I wonder if that phenomenon happens everywhere. I’m assuming it does in almost all major metro markets becuase I’ve withnessed it in many but what about rural places?

Anyway, in case someone didn’t know what I meant…a small caveat:

p.s. if you don’t know what I’m talking about with the crazy marketing stuff you obviously a) have never been through the foreclosure process yourself or known someone closely who has, b) aren’t an active foreclosure investor, or c) don’t live in a large metro market with huge numbers of highly competitive and very aggressive investors chasing a limited subset of profitable deals, or some combination of the three…

:biggrin

3

[i]“If you think your stealing from them, you probably are.”

" If you think your helping them out of difficult situation, you probably are."[/i]

4

We are there to extract equity… To pay less than “traditional” value… I can not say I am sorry for that…

5

what the guys said…

I was listening to Zig Ziglar once and he drove home when he said you have to truely believe in the product you are selling and comfortable enough to sell it to your own parents knowing your product will help them/benefit them.

If your parents were facing foreclosure, would you buy their house the same way and do what you are doing? assuming you love your parents of course.

6

Well, you certainly put out a topic that’ll evoke the emotional side of the argument. For starters, I believe everyone defines the term pre-foreclosure incorrectly. Most people say that is when the owner receives the NOD.

I say it is before the NOD. Hence the pre in pre-foreclsoure. When the owner receives the NOD, they are in the legality called foreclosure. It may take 121 days or it make one year. That is statutorily delineated.

When I get a call from someone in either pre-foreclosure or foreclosure, I have a series of questions I ask them. One of the first questions is what do you want to do? Do you want to keep the house or let it go?

If the answer is keep the house, I work with them, for a fee, to help them keep the house. Sometimes I am not always successful but I give it my best shot.

If they don’t want to keep the house, I have 2 sets of disclosures they must read and sign before I accept the duty of performing a short sale. The disclosures explain to the owner that they will be losing their house if I am not successful and they will be receiving absolutely nothing whether I am successful or it goes to foreclosure.

I also always show them the price I will bid for the house and tell them that anything I make over and above that price is mine. Since this is one of the items on one of the disclosures they understand that I may make a profit.

The “I’m here to steal your house” crowd is in every market and if no housing market existed, they would be back selling used cars or vacuum cleaners. I see their ads in my local throw away and just laugh.

I even get calls from them looking for properties. I would be happy to sell to them if they had any money or could qualify for a loan :biggrin.

If your mentality is to steal a house please get out of the business. You are giving the rest of us a bad name. I honestly don’t remember how many people I’ve helped keep their house but that’s really besides the point since we have specialized knowledge for which we can get paid to exercise on the client’s behalf.

Your post indicates no one is honest in this business. I’m sorry you feel that way. I know several here in my community who happen to place the client’s interest above their own. All have nice paydays.

I don’t know how you operate or intend to operate your business but if you place the client first, you can not go wrong. In fact, your referrals should shoot off the chart.

Never intended to start preaching but got a bit irritated with the “if you are one of the honest ones” intimation. You also need to look at why someone is losing their home but I will stop here as this post is a bit windy.

7

Not at all sandalwood. I’m a realist who’s seen both sides of the equation (in pre-foreclosure and buying pre-foreclosures). I’m also an optimist who likes to believe all people are fundamentally good.

Ad I’m certainly not a Marxist…those with specialized knowledge and the will to act deserve to get paid for what they know and can do. I guess my questions were ones of intent and practice and integrity

8

preforeclosure is NOD, TS or Lis Pens status… A foreclosure if the act of selling at the “Court Steps”

I say it is before the NOD. Hence the pre in pre-foreclsoure. When the owner receives the NOD, they are in the legality called foreclosure. It may take 121 days or it make one year. That is statutorily delineated.
in Good ole CA it is 90 days NOD and 21 days TS some states it is 21 days.. know your facts before you barf out numbers
When I get a call from someone in either pre-foreclosure or foreclosure, I have a series of questions I ask them. One of the first questions is what do you want to do? Do you want to keep the house or let it go?

If the answer is keep the house, I work with them, for a fee, to help them keep the house. Sometimes I am not always successful but I give it my best shot.

I bet when there is a ton of money to be made your best shot is never enough. :slight_smile:

If they don't want to keep the house, I have 2 sets of disclosures they must read and sign before I accept the duty of performing a short sale. The disclosures explain to the owner that they will be losing their house if I am not successful and they will be receiving absolutely nothing whether I am successful or it goes to foreclosure.
AND your point
I also always show them the price I will bid for the house and tell them that anything I make over and above that price is mine. Since this is one of the items on one of the disclosures they understand that I may make a profit.
This is the problem with investors who try and be nicey nice and an investor....
The "I'm here to steal your house" crowd is in every market and if no housing market existed, they would be back selling used cars or vacuum cleaners. I see their ads in my local throw away and just laugh.
I havent sold cars but I have bought a lot of houses.... And the idea that I steal them is a matter of opinion... I have yet to buy a house for less than the seller agreed to.
I even get calls from them looking for properties. I would be happy to sell to them if they had any money or could qualify for a loan :biggrin.
That an idiotic thing to state.
If your mentality is to steal a house please get out of the business. You are giving the rest of us a bad name. I honestly don't remember how many people I've helped keep their house but that's really besides the point since we have specialized knowledge for which we can get paid to exercise on the client's behalf.
how much have you peen paid to help these people? And how much have you made by not helping them?
Your post indicates no one is honest in this business. I'm sorry you feel that way. I know several here in my community who happen to place the client's interest above their own. All have nice paydays.
they arent clients unless you are stupid and try and make money on both sides...
Never intended to start preaching but got a bit irritated with the "if you are one of the honest ones" intimation. You also need to look at why someone is losing their home but I will stop here as this post is a bit windy.
yes you do and then you use that information to build value in what you do...BUY houses at a discount....
9

Ugh! I had this happen to me today too. I was at the point of getting the deed so that I can legally market the house. The guy’s mother (the person who actually has the loan in her name) was very much interested in having us take over the problem of her home and sell it for her. She was extremely happy that we had come along to help her take care of this problem house. My mind was already starting to come up with all kinds of great ways to market and get the house sold. Then the son suddenly became all suspicious thinking that we were trying to pull a slick way to steal their home. Prior to this, he was all happy and talking with us about favorite life stories. I didn’t know what to tell him so that he would trust us. Later on, I did think of some legitimate ideas, but at that point, it was too late.
So, what do you all say when someone attempts to accuse you of trying to steal their house? What are some ideas to use to build their trust? Thanks.

Dean

P.S. What irritates me most about this is that this was going to be “The One” that would make it so I could quit my job and do this full time. ARGH!! I was so close! :banghead

10

I

I wanted to add my 2 cents.

It can help when you approach pre-foreclosure investing from a service mentality

What do I mean by this? Picture yourself walking to the kitchen table with a homeowner who’s in default. They’re feeling lost. Overwhelmed. Confused. Scared.

This is their HOME we’re talking about and they are in danger of losing it. The mortgage is unpaid. Likely other bills are unpaid. Letters and papers and legal notices are all piled up on the table…many times UNOPENED (believe it!). Adding to the stack are DOZENS of letters and postcards from other investors with all kinds of messages from “Sell your house today” to “Save your credit” to, in effect, "I want to steal your house!” It’s just too MUCH!

When we’re confronted with crises situations (like being a homeowner in danger of foreclosure) sometimes we humans just turn off, shut down, and try to wish it away. Heads stuck in the sand like an ostrich.

YOU can be the person to help a distressed seller find out their options, and YOU can profit from it.

Look for what you can do FOR people, rather than TO them- BIG difference. Strive to connect with sellers on a HUMAN level. It’s the right thing to do, and besides you’ll find you can negotiate a better deal when you build rapport and they like and trust you. Look to create win-win solutions or even better put yourself in the middle and create a win-win-win solution for the distressed seller, yourself, and an end buyer with problem credit or whatever.

As a professional investor, you deserve to GET PAID for what you KNOW-- so some will disagree with me on this one-- but sometimes if you can solve a seller’s problem with an option they didn’t know about (and one you don’t directly benefit from financially) where they can KEEP THE HOME…do it.

Again, some will disagree but I come from an abundance mindset and a karmic understanding of good energy- and if you do too you can pass on money now, do a good deed by helping, and the universe will reward you later.

Ok, I know that was kind of new-age but do any of the seasoned investors here know what I mean?

The point is, Dean, it sounded like you’re right there and already doing many of the things you’re doing that others have done to get results, both ethically, and profitably.

In my experience what you say is very important, as far as your question…but sometimes two or three other things are as important (how you say it, as well as collateral you use like a credibility kit).

Best of lukc!

11

So lets’ teach a new investor to feel sorry for and to empathize with someone in foreclosure instead off teaching them to close the transaction…

We are INVESTORS… Lets save the saving the world and all of the spiritual cosmic waves bs for the Pope and Mother Teresa…

If you want to have “Good” energy and live an abundant life then buy the house sell it for profit then take some the that profit and tithe…

Walk into a grocery store and buy strangers groceries, cater lunches to entire schools, volunteer your time to the needy…

IMHO the only time you educate the prospect is when you do not want to or can not buy their house…

As for what you say to someone who says you’re taking advantage of them… It is simple… you say “do you feel I am taking advantage of you?” they say yes… you say " Let me apologize, sometimes I do not explain myself enough when I talk about buying your house, I buy houses like yours all of the time and at times I forget to slow down and explain the details… What can I explain to help you?" “ and me also say to you that if you feel like I am trying to take advantage of you when I am done going over the details of me Buying your house I will agree not to buy it” My reputation is more important than buying a house where the seller is dissatisfied.

12

It’s 6 up, half a dozen down in my opinion (also humble). Whether the intent is to ‘educate’ , ‘save’ , ‘help’ any other some such thing I realize not everyone will agree with…or protect your own reputation (something most all will agree is fundamental to long-term success in that arena)…sometimes you pass on a potential deal. We’re not too far from each other MQ, just on separate sides of the Earth lol.

13

Maybe I’m just a newbie but the way I see it, at least from the short sale perspective, it is impossible to steal a house from a homeowner whose only hope is a short sale. For instance, I’m looking at a property that was 100% financed with an 80/20 loan Jan 06 for 244k. That house is currently in foreclosure with the first as the plaintiff. They (homeowners) have it on the market for 266k. Now this house will be lucky to sell today for 210k, plus it needs about 7k worth of fix up. Now it is impossible to steal this house from the owners because they will get nothing at there 266k price. So if I pay 266k, 210k, or 160k they still get zero. They have a date with the sheriff soon and I or some other investor with a successful short sale is their only hope. They are far from being a victim if I buy it for 160k. I guess technically you could call the banks the victims but the reality is I cannot buy the house for less than they (the banks) are willing to discount and sell it for. Where is the thievery? I know perspective plays a role but the presentation even as simple as my little one here should be clear enough to get through a thick skull, I would hope. If I’m wrong please point it out, I learn from constructive criticism. :smile

Thanks,
unixkid

14

Especially in the past few months, distressed homeowners have been turning to short sale as a “way out” of a deteriorating personal situation. When I speak to people about what really happens during a short sale, the reaction I get in all the cases (so far), is relief.

People sometimes just need to be told by someone that it’s ok to let this one (house) go and start over - especially if they are broke or close to it. The most important element to short sale that I point out to people is the benefit to their credit over foreclosure. So starting over is not as hard as it would be with a foreclosure on their record.

In the end, don’t push it. If a homeowner is so emotional about their “options” that your short sale idea looks sinister or you are being accused of “stealing,” then just move on. There are plenty of distressed homeowners out there that will welcome your “help.”

15

So if I can make 50k on a deal should I apply it all(except for a commision)to the primary lender so that my current homeowner has less of a deficiency judgement?

For example

I negotiate the SS payoff to 110k and have an endbuyer for 160k. My homeowner owes 200k on the property.

What is my ethical responsibility? Should I take say 6% and apply the rest to the outstanding debt so that my homeowner has a smaller defeciency, or should I just make the minimum payoff and keep the rest???

16

From the newbie in the group. What deficiency are you talking about ? I could be wrong but as long as they meet the criteria of the debt relief act of 2007 Bush signed into law the deficiency is forgiven. At least between now and the end of 2009. Plus it is my understanding that the distressed seller cannot profit at all from the sale. Not sure if this applies to your question. Take the 50k profit as your paycheck for helping both the homeowner and bank, plus payment for taking on a level of risk by purchasing something that basically you don’t need. Move on to the next deal and do it all over again.