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Can Foreclosure Kill?

foreclosure  

I Sell Foreclosed Properties

I’ve been selling foreclosed properties for 20 years. In that time I have checked the occupancy on thousands of houses that had just been foreclosed upon. I have knocked on the door and said,”Hi, My name is Bill Lublin and I represent the Lender that just foreclosed on your property. I was just stopping by to see what your plans were about leaving the property.”

Usually the reasons for foreclosures fell into what I called the four “D”s.  Death, Divorce, Drugs, and Drinking. Someone dies, and the heirs didn’t make mortgage payments. People divorced and lost the house through spite. People drank or drugged and lost the house to their habit. Sometimes the loss was the result of a gambling problem.

Though I’m a pretty charitable guy, you become inured to the situations because someone has to do the job. You distance yourself from the issues of the former mortgagors because you need to, and sometimes its easy because they’re harsh or offensive or uncaring themselves. Often they’re gone before you get “the assignment” so you don’t even think about them, other then to reflect on the possessions they left behind (a lot of free weights get left – I guess body building and bill paying don’t always go hand in hand). And over the years, it has been a good specialty to pursue. People that sell foreclosures help get housing stock back into the community. We put families in vacant homes, help investors create security for their families, and improve the neighborhoods where the vacant homes are.

A Real Tragedy

Yesterday there was  a headline in  USA Today entitled “Foreclosures Take Toll on Mental Health” which talked about an older couple in Prineville, Oregon, ages 71, and 69 who committed suicide 2 days before their house was scheduled for foreclosure.  The article quoted the Crook County Sheriff’s office who said, “It is believed that the Donacas committed suicide after attempts to save their home following a foreclosure notice left them believing they had few options”.

The article tells us little . Its main point is that losing your home is stressful (Duh!) and that people will react to that stress in a variety of ways.  Raymond Donaca, the brother of the deceased husband Raymond was quoted as saying “He got so deep in debt he couldn’t figure out what to else to do. I guess a guy would have to walk a few miles in his shoes to understand.”  That may be the understatement of this yet new century.

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Their case is obviously extreme, and as obviously disturbing, and I am struggling to make some sense out of this and take some lesson away from it. We aren’t given any of the back story. Why did the house end up in foreclosure? What happened to these two people in the later years of their life that created this problem? What was therein this situation that got out of hand? Were there health issues? What were the financial circumstances that led to their terrible choice? Why didn’t they know that they had other choices?

Be the expert , Be a resource, Be a lifeline.

In the current real estate market, more agents are meeting people who are under financial stress because of the current market and the mortgage industries challenges. Many of us have never had experience with foreclosures or with short sales. We need to be aware that the people that they are dealing with need them to become informed. They need to know what the laws are in their state. We need to find out what programs thir local or state government has put in place to help people in financial trouble. And We need to provide the consumer with answers to their questions so that they can find a more positive way to handle their issues.

 I’m not suggesting that everyone run out and take the first course they find, I’m suggesting that you take the time to google search or go to the local governmental authority, or read the HUD website, learn about Hope Now or get information from Fannie Mae or Freddie Mac and get it out to the consumer.Go to Realtor.org to get information on Short Sales, and look for the information coming to you soon from the NAR Working Group on Short Sales that reported at NAR’s Mid-Year meetings this week.

Every one of us talks about being the expert in our neighborhoods. Knowing where things are, how they work, taxes, schools, movies, and shops. Maybe we can get some more knowledge to share with consumers that need it. We are the members of the Real Estate Profession and the members of our Communities. We can make a difference when we make a living.

Sorry for the weight of the message. I’ll keep it lighter next time-

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Written By

Bill is an unusual blend of Old & New - The CEO Century 21 Advantage Gold (Philadelphia's Largest Century 21 company and BuzzBuilderz (a Social Media Marketing Company), He is a Ninja CEO, blending the Web 1 and 2.0 world together in a fashion that stretches the fabric of the universe. You can follow him on twitter @Billlublin or Facebook or LinkedIn.

11 Comments

11 Comments

  1. Benn Rosales

    May 16, 2008 at 8:32 am

    No apology needed Mr. Lublin – you’re absolutely right to bring this matter to the forefront of our minds, and we are all better for having this reminder that as fun as real estate practice can be, there is so much more we need to do in those communities we cherish.

    We’ve done a few pro-bono listings over the past year and saved a few families from disaster, and we’re called to do more we most certainly would try. What kills me is the 3 months after the payments are overdue calls in very much the situation you just discribed. I wish NAR would do a PSA on this subject.

  2. Tony Orlando

    May 16, 2008 at 8:44 am

    I’ve been reading along for a while now. I just wanted to drop you a comment to say keep up the good work.

  3. Barry Cunningham

    May 16, 2008 at 8:45 am

    I think it may be more important for a lot of agents to take some courses and training and learn how to negotiate with lenders and become adept at short sales and dealing with foreclosures.

  4. Benn Rosales

    May 16, 2008 at 9:11 am

    Barry, the unique bene of being part of such a large membership is this: Quick story, the first shortsale we did was before the crumble, it was just a friend we’d helped get into a home. After a horrible loss to their family as well as income, he was smart enough to call us right away. Once I had met with him and learned his situation, I was honest and told him short selling was not my expertise, but that I would help him no matter what I had to do- so I called about 4 different brokerages around the city looking for a so-called expert. What I found was a collaboration of agents to help my client. In the end, these agents guided us throught the variable maze of the loan service company, lender, and others. I would honestly have to say it was a group effort that went to bat for my client as at the time, there was NO system in place for short selling.

    I did not do a disservice to my client as my ability to negotiate is not one tracked, nor is my ability to know when I need to ask for the help of my collegues and peers. So my advice, don’t turn away and wait for a class, how about speak up and ask your collegues for help and not be afraid to refer the business out to a trusted name. Btw, in the end, we totally won for my client, and his family is now safe and sound.

  5. Kaye Thomas

    May 16, 2008 at 11:11 am

    Classes on short sales and foreclosures can only tell you where to start.. unfortuantely every lender is different… some are easy to work with while others will take you down the garden path and dump you at the last minute. I did short sales in the 90’s and have done a few now.. there are no cheat sheets when it comes to these types of properties..

  6. Ann Cummings

    May 16, 2008 at 1:34 pm

    I am working on a short sale right now, and I knew enough to get one of my colleagues to work with me on this. Like Kaye, I did short sales in the 90’s, but with the whole world being somewhat different now, I knew that I could not go in and wing it. I’ve taken a couple of courses, and what they taught me was to seek help and not think I could even pretend to know enough to help people on my own.

    I believe that those who have become skilled and knowledgeable in the world of short-sales in today’s market have developed niches for themselves, and I know that I would never do one without working with someone who has that skillset to really help my clients. And that’s just what I’m doing right now.

    Kaye’s right – none of those courses truly teach you exactly what you need to know and do – only where to start. They went a little further than that for me – I learned I will not go that route alone. My clients in short-sale situations deserve more than that.

    Benn, you did a great service for your clients by seeking out those more skilled in short-sales than you – my hat’s off to you for reaching out for help.

  7. cindy*staged4more

    May 16, 2008 at 3:11 pm

    I love the way you put it “Be the expert , Be a resource, Be a lifeline.” Essentially that’s our jobs as real estate professionals. It’s brilliantly well said. A lot of times clients don’t see there are any way out, and it’s our job to help them with the solutions. I am very sadden to hear about the suicides, but by being more proactive in our approaches, perhaps we can help to keep these tragedies from happening. (I am a total optimist, I know.)

    Cheers,
    Cindy

  8. Barry Cunningham

    May 16, 2008 at 7:21 pm

    Hey Benn..asking for help? There’s a novel idea! You are absolutely right. Ask for help from someone more knowledgeable trumps a class everytime.

  9. W.C. Varones

    May 16, 2008 at 9:33 pm

    Can foreclosure kill? Sure it can.

    We’ve counted 30 kills so far in Greenspan’s Body Count.

  10. Jeremy Hart

    May 17, 2008 at 11:31 pm

    A couple of things rang true here for me. We’ve not seen many short sales at all here in my area – in fact, I’d venture to guess there are many agents that couldn’t even define them (maybe this deficiency should be the topic of a completely different post), or talk about what the tax liabilities might be.

    I did a short sale a few years ago – divorced individual on self-employed income (an artist), who had no options left. Doge waste throughout the house, no sense of pride in the home anymore. I was completely convinced that this was going to be the most difficult transaction I’d ever done … I knew nothing about short sales, and the situation between owners and buyer was tenuous. I had it worked up in my mind, and unlike Benn who did the REASONABLE thing, I shouldered the burden and literally dragged everyone through the deal until we got it done. But that wasn’t necessarily the right way.

    First mistake, not using resource around me. Got it. You can’t be everything to everybody, so using the knowledge and expertise around you should not be ignored.

    In the end, I realized that the sellers had just given up hope. They needed someone to restore them, to prop them up and help them realize they were going to get through it. That’s value, that’s what an agent can bring to the table.

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