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Saturday, November 7, 2009

Loan Modifications / Short sales don't hurt credit scores!

WOW!!!!! Are there really still this many people that are this stupid...

Ok today's teaching session will cover the consequences of each program. To make sure that anyone involved with me is crystal clear on both of the options so no one ever has to bring these questions up to me ever again.

Short sale: A short sale is when the seller agrees to work with an agent that will negotiate and sell there house at a discounted rate (that the bank has excepted) to another end user or investor. The seller has now lost there home and has to move on into a rental. (the only people that benefit from this are the real estate agent, the bank and the new buyer)

*no one should ever suggest to there client to short sale a property. Short sale strategies are for idiots. They only benefit the buyer (us, not the seller, them)

Now for a customer that has found themselves upside down in there home, there interest rate adjusting but can afford there house payment if the loan was modified to a correct rate the true and only program that will work for them is a Loan Modification.

Loan Modification: A loan modification is for any homeowner in today's market that wants to lower there monthly payment and restructure there loan to the current value of there home in today's upside down real estate market. (like Short sale programs, there are tons of agents/ brokers offering loan modification programs. They are only out for a quick buck and like short sales less than 4% are ever effective)

That being said Loan modifications do work, but if you choose to save your home, lower your payment and set your interest into a fixed position only go with a Loan Modification through an attorney.

No one else, just like every loan modification I have done for friends, family and my other investors. The only effective way to negotiate the modification is through the attorney directly to the bank.

Hmmm: Why is Adam sharing this information with us??????????????????????????????

The reason I am sharing this information with you is because I am tired of people approaching me everyday, offering me super good deals on short sales, telling me how much money I can make convincing people to short sale there house, and in general looking at how many new foreclosures pile up everyday.

So I have now given all of the guys offering me these short sales, something better to do with there time than to steal peoples homes and dreams.

How about now guys you go save mom and dad's house from foreclosure. Come on do something good for the community, Ya I know it doesn't pay as much as the short sales, but man it sure saves a lot of families from being homeless.


Watch out short sale gurus, there is a new kid in town to start showing people the truth behind your little program.

Now another point I want to address with everyone that was brought to my attention was the question about how a Short sale vs. Loan Modification will effect your FICO?

Short sale agents tell there customers that short sales will not effect your Fico score. This is the biggest crock I have ever heard. 1st of all you cannot enter into a short sale with the bank until you are 3 payments behind. Meaning in layman's terms you have not paid for three months. Can anyone say Fico score going down...

"Sarah Davies, vice president of VantageScore, at the Loan Modifications Conference now underway in Dallas, Texas, says restructuring plans on a mortgage, whether in the form a forbearance or Loan Modification, have a relatively insignificant effect on the consumer’s credit score. VantageScore measures the generic consumer’s credit score and his or her likelihood of slipping into 90-plus day delinquencies on a scale of 501 to 990. If a servicer reduces a consumer’s original loan amount from 10-to-30%, the consumer’s credit score is only increased by three to 18 points, depending upon the consumer’s initial standing. Borrowers in the top-tier of credit scores, averaging an 862, receive only a three-point increase. Lower tier borrowers, in the 625 range, can receive an 18-point jump. The credit score increases because the total amount of debt owed is reduced, and the borrower becomes inherently more reliable, Davies said.

However, foreclosure, bankruptcy and short sale can more severely affect the consumer’s credit score. If a borrower, who maintains good credit, is foreclosed, his or her credit score can decrease by as much as 140 points. Bankruptcy for someone in good credit standing results in a reduction of 365 points from the consumer’s credit and a mark on the file for seven to sometimes 10 years, Davies said.

So kids lets scream it once for the cheap seats:




Loan Amounts: $250,000 to $10,000,000 and higher
Available in all states

Property Types: SFR / OO / NOO

Loan Type: Refi, no Cash out, same lender

Credit: NONE, no FICO required

Doc Type: Full Doc or Stated Income, self employed ok

Benefits to the Borrower: Avoid Foreclosure, Lower payments, Lower balance

Exit Strategy: Needs to be in place, only good for 3-5 years

First Lien: 90% LTV, even 100%

Start Rate: 1% - 5%

Prepay Penalty: 0-3 yrs hard

Average cost: $2500-3000


current pay off: 500,000
IO 9%
Monthly payment $ tba
value: $ 300,000

In that scenario we would target a $ 300,000 new principal balance with an interest rate of 2-5%.

There is absolutely NO guaranty your lender will modify your loan.
But we will work hard for you.
Our Lawyers will talk to your lender directly, to ensure every effort and area is covered.

We have a 90% success rate.

It will take you approximately 2 hours to collect your paperwork,

after that it will take us approximately 90 days to get a modification done.

Here is a list of the lenders we have the highest closing ratios and relationships with:

Citigroup Inc
Bank of America
Goldman Sachs Group Inc
JPMorgan Chase & Co
Morgan Stanley
MetLife Inc
Wells Fargo & Co
PNC Financial Services Group Inc
US Bancorp
Bank of NY Mellon Corp
SunTrust Banks Inc
State Street Corp
Capital One Financial Corp
BB&T Corp
Regions Financial Corp
American Express Co
Fifth Third Bancorp

E-mail me for an application and lets save your home today!!



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