Banks Are Running Scared….And I’m Laughing!

The number of homeowners falling behind in their mortgage payments  is at the highest levels in history.

Some of the larger banks are allowing some borrowers with ARMs and interest only loans to refinance without paying any closing cost. Countrywide Home Loans and several other larger lenders have instituted call outs. The lender is calling homeowners just days after the homeowner misses a payment when this does not fit their normal payment habits.

This rise makes for increased opportunities for short sales and lenders are expecting investors to call. Lenders know when an investor calls offering a short sale, it translates into a faster and cheaper process. It becomes a win for the bank, for the investor and the homeowner avoids foreclosure.

While some lenders are more than eager to help homeowners with short sales, many loans are packaged and sold as mortgage backed securities, then sold to investors. As a result of the sale , the amount of leeway given to the homeowner may vary. When the securities are created, specific rules are also created regarding defaulted loans. For example, some loans will not permit loan modifications or they will limit the circumstances under which the loan can be modified. Some securities can and will either cap the number of loans restructured or cap the dollar amount of the portfolio to be restructured.

The east and west coast are seeing some of the biggest increased for foreclosure. California, for example, has made it hard for people to afford homes, so it stands to reason why the foreclosure rate has climbed.

Some lenders have become really aggressive in reaching homeowners. They have reached out to local churches and housing counselors and the United Way to find homeowners to talk to. Some lenders are posting workout information on their websites on ways to solve their problem.

As a real estate investor, you should do the same. Networking is the easiest and cheapest way to get homeowners in foreclosure. As an example, I just had lunch with a loan officer and what was the topic of discussion? How I help homeowners avoid foreclosure. We talked about the foreclosure process and how she could help me help her. How? By simply sending he people she could not help. By simply networking, it translates into profits for you and your family.