How Offering Loss Mitigation Can Help You Buy More Houses

At SaveMeFromForeclosure.com we believe in explaining to our clients ALL of their options when it comes to helping them stop foreclosure on their home.  All of their options can be broken down into two main categories, either keeping or selling their home.

Our records and research indicate that 8 in 10 homeowners, when faced with foreclosure, just want to “keep their house”.  Whether or not they can remains to be seen, but that is the gut reaction of most homeowners facing foreclosure.

If your PreForeclosure marketing screams “WE BUY HOUSES”, many homeowners aren’t going to respond.  As I wrote above, according to our research, 8 in 10 homeowners who contact us want to try and keep their home.  Home many of those 8 (of 10) are going to reply to some type of “WE BUY HOUSES” marketing?  A homeowner’s initial instinct is to keep their home, and as an investor, you should explore how you can help them do so.

The easiest way for us to help homeowners who are behind on mortgage payments keep their home is to offer them a Loss Mitigation service.  This is where we negotiate with their existing lender and structure a repayment plan that gets their loan back into good standing.

Part of the process of providing this service to homeowners is going through a monthly cash flow exercise.  This is where we have the homeowner outline all of their monthly income (after taxes) and compare it to their monthly expenses (mortgage, gas, food, utilities, transportation, etc).

By going through this simple exercise with the homeowner, many times we show them that they have a negative cash flow!  Yes, many homeowners whom we sit down with realize that they are actually spending more each month than they are earning.  They really can’t afford to keep their home, because they spend more per month (on necessities, such as other bills) than they earn.

This is a real eye opener for many homeowners, and they realize that selling their home is actually a much better option.  However, it was the fact that we took the time to explore the option of keeping the home that put us in the position to buy the home from the homeowner.

Just in the past month, I can think of two examples where we went through the cash flow exercise with homeowners.  In both situations they wanted to keep their home.  After going through the cash flow worksheet, they realized that they did not want to continue spending such a large portion of their disposable income on their home.

By spending time and showing homeowners how they can keep their homes, you’ll be forced to explore whether or not Loss Mitigation is a real option for the homeowner.  If it is, then great, help them keep their home, and as we discussed in our last article, earn an income from doing so.

However, talk to enough homeowners about keeping their home, the ones who realize that they can’t afford it, or don’t want to afford it, will look to you to help them sell their home.

 

             

By offering Loss Mitigation, we get a better response to our marketing.  This in turn lets us earn an income when we help the homeowner keep their home.  For those who don’t qualify, or realize that their housing debt is too much of their income, we can help them by buying their homes.