(An article that I wrote for Dream Homes Magazine…)
When we call the bank to invest in one of their products or to open a new account, we are welcomed like an fine Bordeaux at a wine party. Yet when we call these same lending institutions seeking assistance for our depreciating real estate investments, we are treated like we just walked into that same party with 40oz. in a brown bag. These frustrations are felt nationwide, and are no longer exclusive to certain borrower-profiles or geographic locations.
On their most-fundamental level, banks pool (some of) our money, lend to qualified borrowers with interest, then take their fees while that borrower pays on the debt. In a sense, they work for us. So why is the Government having to step in with programs like HAMP and HAFA to get them to cooperate? Shouldn’t the banks be wanting to help us? Not only are we customers, but we are the mortgagors! Au contraire.
If you have not had the pleasure of calling your lending institution in a loss mitigation capacity, just imagine calling BP with a request to stop the oil leak. As a seasoned Broker and short sale Negotiator, I’ve heard some good lines from the banks. They’ll say things like, “we cannot help you short sell unless you make a payment” which is not true; “We never received the fax” when I have multiple confirmations; and “we cannot adjust the acceptance letter” when the negotiator on the file I was previously working on did indeed. Understanding why many people call bankers difficult and manipulative is certainly not a challenge.
Common sense leads us to think things like, ‘why wouldn’t the bank just accept our offer to get it off their hands?’, or ‘wouldn’t the lender rather sell my home instead of go through the hassle and costs of a foreclosure, regardless of my financial circumstances?’ My friends, here is one of the secrets to my success as a short sale Negotiator: rid yourself of that logic when calling the banks. If you don’t, your foot-tapping and moodiness will drive those around you crazy. On another level, we real estate professionals that do this full-time have dung slung at us by these guys all day. Some of it is rudely obvious with bad language (I have indeed been cursed), and some of it is indirect via ‘lost faxes’, being hung-up on, and transferred so many times that you’ve made up your own lyrics to the hold music.
The Million Dollar Question: Why are these lenders being so uncooperative in their efforts to “help us”? Since I am not an attorney nor accountant nor fly on the wall at JP Morgan Chase HQ, I will leave that speculation to the bloggers. Despite all of my experience and all the research, webcasts, seminars, and conference calls I participate in daily, I have yet to hear a sufficient (or even consistent) answer from these banks or lending institutions. As my father always says, “eventually, two plus two always makes four”. The real answers WILL come with time.
It is unsettling to end an article with a question and not a solution, but I don’t think I’ll get much resistance from anyone when I say that this real estate mess is not over yet, or even close to it. The veil is still in place, cooperation and transparency are desperately needed. Until then, people like me will continue ‘fighting for the little guys’. If you find yourself in the position of needing to sell, make sure you work with a knowledgeable, experienced professional who knows the ins and outs of the market and intricacies of your specific lender. Believe it or not, some of us actually ENJOY trying to solve this riddle. Like many fine wines, we Negotiators get better with time.
– Jeff Grant, President, ShhortSale.com