short sale training

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Short Sale Training:

Short Sale Training © Copyright 2010, Realty Direct Naples. All Rights Reserved.

Short Sale Introduction:

Short Sale Introduction Short Sale Facts How To Find Short Sale Prospects Marketing To Short Sale Prospects Short Sale Listing Presentation Short Sale Sales Contract Short Sale Negotiations Short Sale Resources

Short Sale Facts:

Short Sale Facts Less Than 25% Of All Short Sales Actually Close! Source: USA Today It Has Been Estimated That 9 Out Of 10 Homeowners Trying A Short Sale Are Represented By A Real Estate Agent With Little Or No Short Sale Experience. Source: Broward County MLS How Long Will Short Sales Be Around? 5 Years? 10 Years? MLS Stats Say?: 

How To Find Short Sale Prospects:

How To Find Short Sale Prospects Find Short Sale Candidates: “Lis Pendens” www.CollierClerk.com Locate Address & Cross Reference: www.SunshineMLS.com Marketing & Sphere Of Influence

Marketing To Short Sale Prospects:

Marketing To Short Sale Prospects Step 1: Create A Lead Capture Page Step 2: Create A Drip Mail Campaign Step 3: Short Sale Marketing System A.) Direct Mail B.) Internet Marketing: PPC, SEO, Blogging C.) Print Media: Display Ads & Classified Ads D.) Social Media: Facebook & Twitter E.) Short Sale Referral System

Lead Capture Page:

Lead Capture Page Free Web Site: www.Yola.com Domain Name: www.Godaddy.com

Drip Mail Campaign:

Drip Mail Campaign What Is A Drip Mail Campaign? Drip Mail is a communication strategy that sends, or "drips," a pre-written set of messages to customers or prospects over time www.Contact29.com www.Aweber.com www.real-estate-drip-email-campaigns.com

Direct Mail – Postcards & Letters:

Direct Mail – Postcards & Letters

Internet Marketing:

Internet Marketing Search Engine Optimization: Google, Yahoo, Bing. ( www.WebConfs.com – “15 Minute SEO Checklist”) Social Media: Facebook Fan Page ( www.PageModo.com ), Facebook Profile, Twitter Pay Per Click – Google, Yahoo, Bing Video - YouTube

Short Sale Referral System:

Short Sale Referral System How to generate referrals for potential Short Sale customers Initiate Fast Start Action Plan Leverage Listing & Buyer Customers Ethically and Legally offer “Bribes” for Referrals

Short Sale Referral System:

Short Sale Referral System Fast Start Action Plan Take inventory of your resources: Make list of 50 people you know (friends, family, acquaintances, current customers, contractors, loan officers, attorneys, title, RE agents, etc.) Don’t for get to include RD on your list of resources! Take action: Send 5 emails every morning and 5 every afternoon Follow up each email with a personal phone call Tell them about how we can help homeowners who are upside down in their home or behind on their mortgage payments Make sure to ask for their referrals directly

Short Sale Referral System:

Short Sale Referral System Fast Start Action Plan Loan Officers – special category They often have applicants for loan modifications or refinances who are upside down and do not qualify. We can help those homeowners when they cannot. We cannot offer them a referral fee We can offer to place their sign in the yard of any listing they referred us for them to generate new buyer leads. We can offer to place their contact info in the MLS confidential remarks section of any listing they referred us. Potential for future buyer after seller completes short sale.

Short Sale Referral System:

Short Sale Referral System Fast Start Action Plan Attorneys & Title Companies – special category They often work with homeowners behind on their mortgage payments on foreclosure defense and loan modifications. They are usually not expert Short Sale negotiator We work with expert Short Sale negotiators who will negotiate their Short Sales. We are experts at marketing our Short Sale listings and find end buyers quickly so they can close and get paid We cannot offer them a referral fee We can offer their office the closing for any Short Sale listing they refer to us

Short Sale Referral System:

Short Sale Referral System Fast Start Action Plan Real Estate Agents – special category They often have potential Short Sale customers they turn down because they don’t know how to do Short Sale or their office will not allow them to We can offer them a referral fee to be paid at closing They send us a name, we do all the work, they get paid

Short Sale Referral System:

Short Sale Referral System Leverage Listing & Buyer Customers you want to take advantage of their positive frame of mind to ask them for referrals At the close of the initial meeting (referral cards) At the close of escrow (referral cards) How to Ethically and Legally offer “Bribes” for Referrals Offer a your contacts a gift card ($25-50) for referring to you potential buyers or sellers Make sure your referral gift is not conditioned on a transaction, but rather on your contact simply proving you a name & number

Short Sale Referral System:

Short Sale Referral System Key Phrases to Get Referrals: “If you know someone who is upside down in their home or behind on their mortgage payments, we can help.” “Do you know of anyone who is also considering a move who would benefit from my services?” “Can I call you at work tomorrow to get their contact info?’ “Can I use your name when I talk to them and let them know, you referred them to me?’

Short Sale Referral System:

Short Sale Referral System Sample Referral E-Mail: Hi John, I wanted to drop you a quick line and let you know I recently decided to move my real estate license and join Realty Direct. On of the reasons I decided to join Realty Direct is their great homeowner assistance program. If you know someone who is upside down in their home or behind on their mortgage payments, I can help. Please forward me their contact info or ask them to call me and I will set up a free and confidential consultation to show them what their options are. I also have a great Referral Reward Program that rewards you with a $50 Visa gift card for each referral you send my way, whether they decide to work with me or not. I hope to hear from you soon.

Short Sale Referral System:

Short Sale Referral System Sample Referral Cards:

Short Sale Listing Presentation:

Short Sale Listing Presentation © Copyright 2010, Realty Direct Naples. All Rights Reserved.

What Is A Foreclosure?:

What Is A Foreclosure? Foreclosure is the basic process of repossession of a loan that involved a house. Allows lender to recover the amount owned on a defaulted loan by selling or taking ownership of the of the property. The process begins when a borrower defaults on loan payments and lender files a public default notice or lis pendens (lawsuit)

Foreclosure Myths & Half Truths:

Foreclosure Myths & Half Truths ½ Truth 1 – “If you don’t pay by ____ we are going to take your house.” Reality – “if you don’t pay by ____ the foreclosure process will continue on its course unless interrupted by a different workout plan that you obtain or by a Bankruptcy if you should file one.”

Foreclosure Myths & Half Truths:

Foreclosure Myths & Half Truths ½ Truth 2 – “We don’t have to work with you, this is just a courtesy we offer.” Reality – “We are not obligated to work with you but it is our company policy to help everyone that is in default with an opportunity to resolve their delinquency to avoid Foreclosure.”

Foreclosure Myths & Half Truths:

Foreclosure Myths & Half Truths ½ Truth 3 – “You can’t refinance.” Reality – “Once a loan goes into a status of ‘Foreclosure’ most lenders are restricted as to how much money they can loan you based on the value of your house. If the payoff of the loan is $___ and if your home does not appraise for $___ then finding a lender that can help you will be extremely difficult.”

Foreclosure Myths & Half Truths:

Foreclosure Myths & Half Truths ½ Truth 4 – “You can’t sell your house.” Reality – “Based on our opinion of value, the option of selling your house will be difficult because you owe more than what the house is worth. We do have programs that would allow you to sell the house for less than the debt owed but you would have to qualify.”

What Are the Options?:

What Are the Options? Do Nothing Payment Plan Loan Modification Refinance Forbearance Plan Deed in Lieu of Foreclosure Bankruptcy Selling the House

Option 1 - Do Nothing Option:

Option 1 - Do Nothing Option Most likely will result in loss of the home at the foreclosure auction. Loan/credit applications generally ask if the applicant has ever been foreclosed upon. Credit reports may disclose this damaging information making it difficult to obtain loans and financing in the future.

Option 2 - Payment Plan:

Option 2 - Payment Plan Usually for short-term financial problems. A plan to work out a way to get caught up. Usually available when homeowner is only 1 or 2 payments behind. Homeowner makes a small payment in addition to their regular monthly payment. If someone can’t cover the regular payment odds are not good they can cover an increased payment.

Option 3 - Loan Modification:

Option 3 - Loan Modification A permanent change to the existing loan, usually with a lower payment. An internal refinance of the loan without the complications of a full refinance. Often appraisals, credit scores and other loan origination documents are NOT required, BUT this is changing! Can be done before or after Foreclosure has been initiated.

Option 4 - Refinance:

Option 4 - Refinance Potential fresh start with a new lender. May provide a new lower payment. May provide a lower interest rate. May allow for consolidation of several loans. Could get denied at last minute. Could increase payment & rate causing more problems.

Option 5 - Forbearance Plan:

Option 5 - Forbearance Plan This is a repayment plan after the Foreclosure has begun. Bank cannot accept any money from borrower without a written agreement stipulating the terms. Usually 6-12 months, but up to 24 months. If someone can’t cover the regular payment odds are not good they can cover an increased payment.

Option 6 - Deed in Lieu :

Option 6 - Deed in Lieu Deed in Lieu is a voluntarily transfer of the deed to your house to the lender so they do not foreclose. Attractive to lenders because it saves them the time and cost of foreclosing. Often only available if there are not any other liens on the property. Credit reports may disclose this damaging information making it difficult to obtain loans and financing in the future.

Option 6 - Deed in Lieu cont.:

Option 6 - Deed in Lieu cont. Potential Issues : Lender may choose to foreclose anyway because it is a “cleaner” transfer of title. Lender may offer “cash for keys” or cash incentives to perform the Deed in Lieu , BUT homeowner may still be responsible for taxes or any other liens on the property.

Option 7 – Bankruptcy :

Option 7 – Bankruptcy This option can liquidate debt and/or allow more time to pay back debt. Chapter 7 (Liquidation) To completely settle personal debt. Chapter 13 (Wage Earner Plan) Payments are made toward a plan to pay off debts in 3 – 5 years. Chapter 11 (Business Reorganization) A business debt solution. Consult a qualified bankruptcy attorney.

Option 8 - Selling The House:

Option 8 - Selling The House Can be problematic if the loan balance exceeds the value of the house. Homeowner can sell and come to the closing with the difference between the sale amount and the loan value. Homeowner can try to negotiate a Short Sale with the lien holder(s) for less then what is owed.

What is a Short Sale?:

What is a Short Sale? A Short Sale is when a mortgage lender(s) and/or lien holder(s) agree to take less than what is owed so that one can sell the home A home may be over-leveraged or “upside down” A homeowner may behind on payments and cannot sell for high enough to cover what they owe plus the other required fees to close Lenders created short sales as a foreclosure alternative Lenders would rather allow a homeowner to short sale versus foreclosing Foreclosing on properties costs lenders money

Who Should Consider a Short Sale?:

Who Should Consider a Short Sale? If a homeowner is behind on their mortgage payments or soon will be. If none of the other options fit their situation. If a homeowner is facing Foreclosure because they cannot afford to pay If a homeowner owes more on their house than it is worth.

Who Qualifies For a Short Sale?:

Who Qualifies For a Short Sale? Several factors to consider : Reason for delinquency? Type of loan (FHA, VA, conventional, etc.) What is their financial situation? Is the home listed? Is there more than 1 loan? How far behind are they? Has the Foreclosure been filed?

Who Qualifies? And How?:

Who Qualifies? And How? In General, to Qualify a homeowner must simply: Be experiencing a True Financial Hardship Be in default on their mortgage or facing imminent default Be in a ‘Must Sell’ situation Have NO Equity in their home Have NO available assets Have a lender and loan type with a clearly defined short sale process

What To Expect?:

What To Expect? The Short Sale Process could take 4-6 months or longer to complete. Patience and Communication are the keys to success. Collect Short Sale & Listing Package Sales Contract/Pending Short Sale Package is Submitted Bank Orders an Appraisal/BPO Negotiations With Bank Bank Approves Short Sale Property is Sold

Homeowner Concerns :

Homeowner Concerns Issue Foreclosure, Deed in Lieu & Bankruptcy Successful Short Sale Future Fannie Mae Loans – Primary Residences (Effective May 21 st , 2008) A homeowner is ineligible for a Fannie Mae backed mortgage for a period of: Foreclosure – 5 years Deed in Lieu – 4 years Bankruptcy – 4 years A homeowner who successfully negotiates and closes a Short Sale will be eligible for a Fannie Mae backed mortgage after only 2 years . Future Fannie Mae Loans – Non-Primary Residences (Effective May 21 st , 2008) An investor how allows a property to go to foreclosure is ineligible for a Fannie Mae backed investment mortgage for a period of 7 years . A investor who successfully negotiates and closes a Short Sale will be eligible for a Fannie Mae backed mortgage after only 2 years . Future Loans with Any Mortgage Company On all future 1003 applications (Standard Loan Application), a prospective homeowner will have to answer YES to question C, in Section VIII, that asks, “ Have you had property foreclosed upon, or given title or deed in lieu thereof ?” There is no similar declaration or question regarding a Short Sale.

Homeowner Concerns :

Homeowner Concerns Issue Foreclosure, Deed in Lieu & Bankruptcy Successful Short Sale Cost You may still be responsible for taxes or any other liens on the property in a Deed in Lieu and an attorney may charge $1,000-2,500 to file a bankruptcy . Our company does not charge any upfront fees, negotiating fees, or transaction fees to the Homeowner, nor do we charge fees to the end buyer. Credit History Foreclosure can remain as a public record on a person's credit history for 10 years or more . Short Sales are not reported on a credit history . There is no specific item for 'short sale'. Is typically reported 'paid in full, settled'. Security Clearances Foreclosures is the most challenging issue against a security clearance outside a conviction of a serious mis-demeanor or felony. A Short Sale on its own does not challenge most security clearances . Current Employment Employers have the right and are actively checking the credit regularly of all employees who are in sensitive positions. A Short Sale is not reported on a credit report and is therefore not a challenge to employment .

Homeowner Concerns :

Homeowner Concerns Issue Foreclosure, Deed in Lieu & Bankruptcy Successful Short Sale Future Employment Many employers are requiring credit checks on all job applicants. A foreclosure is one of the most detrimental credit items an applicant can have; in many cases will challenge employment . A Short Sale is not reported on a credit report and is therefore not a challenge to employment . Deficiency Judgment In 100% of foreclosures (except in those states where there is no deficiency) the bank has the right to pursue a deficiency judgment In some successful Short Sales it is possible to convince the lender to give up the right to pursue a deficiency judgment against the home owner. Deficiency Judgment (amount) In a foreclosure the home will have to go through an REO process if it does not sell at public auction. In most cases this will result in a lower sales price and longer time to sell in a declining market. This can result in higher deficiency . In a properly managed Short Sale the home is sold at a price that should be close to market value and in many cases will be better than an REO sale resulting in a possible lower deficiency .

The Short Sale Sales Contract:

The Short Sale Sales Contract © Copyright 2010, Realty Direct Naples. All Rights Reserved.

The Contract Offer - EXPECTATIONS:

The Contract Offer - EXPECTATIONS Closing: 60-90 Days. Deposit: 3-5% Held In Escrow At Time Of Execution. Sale Price: Justify The Price Using YOUR CMA Report. Pre-Approval Letter. (M&I Bank) BPO Agent: The Deal Breaker! The Most Important Meeting Of The Entire Transaction. (Remove Key Box) Mortgage Appraisal: If The Agent Is From The Cape, Cancel The Appointment! The Property Is Sold “AS IS” – Have Buyer Do Visible Inspection Prior To Writing An Offer. Encourage An AHS Warranty.

Short Sale Negotiations:

Short Sale Negotiations © Copyright 2010, Realty Direct Naples. All Rights Reserved.

Short Sale Negotiator:

Short Sale Negotiator STEP 1: Real Estate Agents Should NOT Do Their Own Short Sale Negotiations. STEP 2: REPEAT STEP 1 ABOVE!!!! STEP 3: Contact A Short Sale Negotiator

Professional Short Sale Negotiator:

Professional Short Sale Negotiator Winged Foot Title Rich Galipeau, Sales & Marketing Manager 8695 College Parkway, Suite 2350 Fort Myers, Florida 33919 P: (239) 985-4142 C: (239) 560-0230 E: rich@wingedfoottitle.com W: www.WingedFootTitle.com Blog: www.homeclosingprocess.com

Short Sale Resources:

Short Sale Resources Derek Carlson Short Sale Partnership Program 50% Referral Paid To YOU! I Get The Listing I Pay For All Marketing I Work With The Negotiation Team I Close The Deal YOU GET 50% COMMISSION! FOR MORE INFORMATION: derek@realtydirect.com

Short Sale Resources:

Short Sale Resources November 14 & 15, 2011 Registration begins at 8:00 am Class from 9:00 am - 5:30 pm CE Hours: 11 Florida hours Location: Hilton Garden Inn 16410 Corporate Commerce Way Ft. Myers, FL 33913

Short Sale Resources:

Short Sale Resources www.RealtorSFR.org

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