As many of my readers know, I follow the foreclosure crisis heavily and I have a keen interest in the loss mitigation, loan modification and loan workout side of the business. This seems to be an area that is not reported on much and there isn’t really any intelligent information being disseminated about it.

I frequent many forums and blogs in the industry so I can get a heart beat on what’s going on in the trenches. One of the hot topics right now is the business of loss mitigation. There are many real estate and mortgage professionals that are out of work and out of money looking for opportunities to exit the industry or switch hats into the loss mitigation arena.

Hell, it beats going to work for Mc Donald’s.

I think this can and will be a great field to work in over the next few years as the foreclosure rate rises and there is a need for someone to act as a “paid” consultant to the homeowner. There is also a need in the non-profit sector also. They are flooded with homeowners who need help and in turn they need assistance to handle the calls and cases they are working on. I feel both can be of real value to homeowners if they provide adequate loss mitigation services in a timely manner.

For example I was just informed that national hot lines like 888-995-HOPE have a waiting list because they are handling so many homeowners that need assistance in dealing with their mortgage companies. It gets me a little worried when fantastic non-profit services like www.995HOPE.org have a waiting list because I know when someone is facing foreclosure, there is a short timeline and a homeowners needs to act as fast as they can.

For profit loss mitigation is a touchy subject and one that I hold dear to my heart because this is a serious issue that people and our country is dealing with. Unfortunately, where there is money to be made in a unregulated industry, you will have the scammers and sharks coming out of the woodwork to prey on uneducated and ill informed homeowners and also people that are looking into this as a career.

Yes, people that are looking into this as a career are getting scammed also into paying hundred’s and maybe thousand’s of dollars to become certified as a loss mitigation consultant.

Do you know what? There is no such thing as a “Certified Loss Mitigation Consultant”. That’s just a trumped up piece of paper designed by a creative entrapping to recruit uneducated and ill informed people into their scheme. This certificate  is only worth as much as the paper it’s written on. About 2 cents. So, don’t waste your money on a certification that means nothing. Don’t become another victim of this crisis.

Many of these companies do offer a service but in actuality a homeowner can do it for free or they can call a non-profit that is “Certified by HUD” as a housing counselor and in loss mitigation to the homeowner. That is the only official certification that is recognized by HUD or any government agency in regards to loss mitigation. There are no other agencies that issue or monitor licensing or certifications in this field.

Why would anyone pay for a service that they can do themselves or can do for free with a non-profit?

Lack of knowledge and the perception that there is some secret formula and these loss mitigation companies use top secret strategies to magically get lenders to modify loans and save people’s homes. And they call the lender on the bat phone and have direct contact with the investors on Wall Street, blah…blah….blah….

Rubbish! Bullshit!

NEWS ALERT: There is no magic. There is no magic formula. There is no bat phone.

Loss mitigation to the homeowner is a process. Think about the term “loss mitigation”. What does it mean? It means to mitigate loss, to lesson potential loss , actions designed to alleviate the injury suffered or to reduce the cost of that injury to that injured party, activities designed to reduce either the likelihood of the homeowner suffering financial losses on a loan or the final dollar value of those losses in the event of a borrower default.

In performing loss mitigation for a homeowner, you are now up against a lender who is doing the exact same thing as you but with their loss mitigation efforts and best interests are with their investors and the contract that they have with these investors. So, essentially you have a conflict of internet when you have a debtor and a debtee trying to mitigate loss individually on the same transaction.

Think about it.

Ones pushing and ones pulling. Both want to win the tug a war with the least amount of loss and many times, there are no winners because of the dual mitigation efforts. This causes PROBLEMS AND HEADACHES for everyone involved! It convolutes the whole process and muddies the whole intentions of “loss mitigation”. Thus reversing the original intention of both parties and resulting in what both parties wanted, “to avoid foreclosure!”

Loss mitigation is a process and an art. It’s a delicate balance between the facts, reality, distorted reality and the art of negotiation. Those are the basics but when you get down the heart of it, most loss mitigation companies that are for profit and even non-profits are missing some main ingredients when dealing with a homeowner and their lender.

There are companies that are popping up left and right and usually during a down market like we have now.  Most only go so far and to me that is not truly effective “loss mitigation”. There is NO MAGIC in what they do. What they put some voodoo spell on the paperwork or use some mind manipulation to get lenders to work with them? NO!

I am a big advocate for homeowners to do it themselves and I give them the tools to do so on here and my forum at www.LoanSafe.org. But the reality is that many can’t or do not have the time. I then recommend seeking a non-profits help. Non-profits can only help a homeowners get so far and they know this. Many times a homeowner will need a lawyer, an accountant, tax advice, a real estate agent, BK etc.

You do not want guys like this representing homeowners or do you?

Carlos

Service Provider

The loss Mitigation business does not involve or need more that what you already have access to. All you need to do this, is a computer with Internet connection and a telephone line. The system that we have in place leverages your time giving you the opportunity to spend more time pre-qualifying your clients and giving them the best advice you can. As you move forward and gain experience, you will have a clear picture and understanding of the process, and will know how involve into the process you would like to be.

What????? All you need is a computer, internet connection and phone line. What a joke these companies are.
 
In reality you don’t even need that.  All you really need is MONEY to pay them $X amount of dollars to get your loss mitigation consultant certification which is completely worthless and your in business of being a service to homeowners. But in REALITY in you trying to be of service, you are a Disservice to homeowners everywhere and further worsening the foreclosure crisis with your wild, wild west foreclosure rescue schemes.

When I questioned this guy on if he know that he is liable for the clainms he makes when dealing with homeowners, this is the response i got:

Carlos:

“No I am not liable. The contract, that provides 100% guarantee for the homeowners, is signed between the company and the homeowner. In addition, I do NOT collect information such as Social Security numbers etc… Nor do I collect ANY fees. I am an independent contractor. I have had an attorney look over this thoroughly and know my place and my boundaries. However, there are many “companies” structured somewhat like this and they have their agents/consultants collect fees, sign contracts, hold fees and collect personal data thereby putting them in the drivers seat and thereby liable. T
Wow! So these foreclosure rescue firms are informing their ill informed NEW RECRUITS that they are not liable for their actions or misrepresentations in FACILITATING a BUSINESS RELATIONSHIP between the BUSINESS which HE REPRESENTS and the homeowner who is facing foreclosure. 

YES, YOU ARE LIABLE AND YOU WILL BE SUED IF YOU ARE DOING THIS KITCHEN TABLE FLY BY NIGHT RESCUE SCAMS! Sooner rather than later.

Imagine what some of these fake certified “loss mitigation consultants” are telling homeowners? Someone who passes some fake certification course and pays x amount of dollars is now acting as a “legal” professional and giving “legal” advice to homeowners facing foreclosure. Unbelievable? YES! But believe it, because it’s reality and Mr. Carlos will be knocking on doors and chasing ambulances at a home near you real soon.

Hopefully, it’s not your home and life that will be on the line that is being handled by someone like Carlos.

Moe

Founder & Homeowner Advocate
LoanSafe.org
LoanWorkout.org
951-271-6283 Phone
800-734-8819 Fax
Moe at LoanSafe.org Email

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