The last article outlined the Foreclosure Process in South Carolina, and one of the items briefly mentioned was the lender's collection attempts. Lenders can be rather persistant in their collection efforts. Those phone calls and letters sometimes border on harrassment, and that is where you come in.
Homeowners facing foreclosure want the calls to stop and their financial situation to improve. The problem is an internet search for foreclosure or bankruptcy help yields hundreds of thousands of results. With all of that information out there, a homeowner facing foreclosure can become confused, and a confused mind will shut down.
Foreclosure is a scary and confusing process for many homeowners, and those homeowners need professionals to help them find solutions. Whether you are a Real Estate Investor, Realtor, Bankruptcy Attorney or provide a Loan Modification Service, you offer a solution that can help a homeowner in financial trouble.
Most homeowners want to remain in their home, so if you have the tools and services to help keep a homeowner in their home, your expertise is invaluable to the homeowner. Although many homeowners want to remain in their home, some are simply overextended and need to save their credit and avoid foreclosure, so if you have the tools and services to buy or help a homeowner sell their home, your expertise is invaluable to the homeowner.
The combination of the lender’s borderline harassing phone calls and letters, the homeowner’s confusion and desire for a solution creates a situation where professionals with viable solutions are in high demand by homeowners.
Another reason Lis Pendens data lists are a good lead source is many banks are willing to negotiate the terms (amount and/or interest rate) of the loan. I switched from the term lenders to banks for a reason - not all lenders are banks but a vast majority of them are. Not all lenders are willing to negotiate to with professionals helping homeowners; however, since banks face significant pressure from regulators, non-performing assets are not only bothersome but troublesome as well.
Mortgages are assets to any lender, but when a bank's asset turns into a non-performing asset, the banks ability to lend money is negatively impacted, and that in turn impacts a bank's profit. Therefore, it is to the bank's advantage to negotiate the terms of the loan in order to turn a non-performing asset from a liability back into an asset or approve a short sale to remove the non-performing asset from the financial statement.
As you can see, homeowners facing foreclosure need your service and many lenders are willing to negotiate the terms of a non-performing asset (loan) to increase profit. This creates an opportunity for you, as a professional, to help a homeowner find a solution, help a Lender turn a non-performing asset back into a performing asset and you can profit for your services.
With the hundreds of thousands of search results, there is simply too much information out there for a homeowner to sift through to quickly find your service. The question is how do you get the benefits of your service and solution in front of homeowners when they need your service and solution?
The answer is Lis Pendens filings. The next article will discuss how to find Lis Pendens filings in South Carolina.
Interested in finding and marketing to your local Lis Pendens? Sign up at www.scdistressedhomes.com/pricing.html to receive a free trial of our Lis Pendens Data Lists and start providing your service to homeowners facing foreclosure.
Did you find this article useful and informative? If so, visit www.scdistressedhomes.com to sign up for our newsletter.
Aaron
South Carolina is a mortgage state, and that means when money is borrowed to purchase a home, the borrower promises to repay the loan by signing a Promissory Note and a lien is placed on the home in the form of a Mortgage.
If the borrower is unable to repay the loan, the lender is required to foreclose through a judicial foreclosure process in order to take ownership of the home. The judicial foreclosure process starts when the lender files a Lis Pendens. Typically, there is a 4-6 month window from when a Lis Pendens is filed to when the home is sold at the county foreclosure auction.
From www.foreclosurelaw.org: “The judicial foreclosure process is one in which the lender must file a complaint against the borrower and obtain a decree of sale from a court having jurisdiction in the county where the property is located before foreclosure proceedings can begin. Generally, if the court finds the borrower in default, they will give them a set period of time to pay the delinquent amount, plus costs. If the borrower does not pay within the set period of time, the court will then order the property to be sold.”
Once the court orders a home to be sold, the home is scheduled to be sold at a county courthouse foreclosure auction. I have been to foreclosure auctions in Charleston and Berkeley Counties, and both processes are different. When I went, Charleston County held the foreclosure auction on the courthouse steps and Berkeley County held their foreclosure auction in a courtroom. Check with your local county Clerk of Courts for their foreclosure auction process.
That is the bare bones description of the legal portion of the foreclosure process in South Carolina; however, a Lis Pendens filing is merely the first legal step in the foreclosure process and not the homeowner's first notification of default or the lender's first attempt to collect the mortgage (This helps you when marketing to homeowners on our Lis Pendens data lists and negotiating with lenders, which is normally a bank).
The lender begins attempting to collect missed payments as soon as the first payment is missed. Collection efforts vary by lender, but they normally include phone calls and letters. Some lenders contact the borrower as little as one week after the first missed payment.
Does that seem a little excessive to you? I agree it is. On most home loans, late fees do not start until somewhere between 15-30 days late. So why do some banks call after only 7 days?
Simple - they learned from experience. Prior to the foreclosure crisis, lenders only sent a letter or two after a borrower's payment was 30 days past due and became a little more aggressive until the Lis Pendens was filed. During the foreclosure crisis, lenders became more active in collecting missed payments, which led them to more aggressively contacting homeowners earlier and earlier in the default process.
There are a few more facts about the foreclosure process worth mentioning, but those facts relate to why Lis Pendens filings are an excellent lead source and will be discussed in the next article - Lis Pendens Filings as a Lead Source.
Interested in finding and marketing to your local Lis Pendens? Sign up at www.scdistressedhomes.com/pricing.html to receive a free trial of our Lis Pendens Data Lists and start contacting motivated sellers.
Did you find this article useful and informative? If so, visit www.scdistressedhomes.com to sign up for our newsletter.
Aaron
Real Estate Investor and Data Provide (SC Lis Pendens)
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