Could Loss Mitigation Be The Career For You?
Foreclosures are currently at an all time high and with the trend looking set to continue it offers an opportunity to get involved at a business level in the real estate market. There are two aspects of the market that you can realistically get involved in. The first option is the Short Sale Market, where a borrower has a mortgage that is worth more than the value of their property and need to sell to cut their losses. This market is mainly for investors and is extremely difficult to enter into unless you have some previous experience in the real estate or mortgage business. The second more appealing business option is Loss Mitigation. This is aimed at helping homeowners save their homes from foreclosure while still being able to stay in the property.
Loss Mitigation is a process where a third party will work with the homeowner and lender and negotiate a more affordable deal than the homeowner would be able to attain on their own. There are a couple of reasons why this service works so well. Firstly the negotiator works only on a professional basis and doesn’t let emotion cloud his judgment. He can concentrate wholly on the facts and figures and on that basis alone can achieve a better deal than the average homeowner would. The other reason is the knowledge and information they can provide of all the lenders various programs and rules which a normal homeowner just wouldn’t have.
There are some things worth considering if you are thinking about starting a Loss Mitigation as a business. You should form an affiliation with a company that can provide this type of service for your clients. In effect you’d be looking for something similar to an outsourcing company. Although Loss Mitigation is very rewarding it also carries a high burden of uncertainty as well as liability. By using an already established company that can provide a reliable, responsible level of service will be beneficial to you and your clients. It will be beneficial firstly, because an established company will already have a network of connections to lenders in place. It will also have knowledge of the ever changing rules and programs each individual lender has to offer. In a fast changing marketplace this information is invaluable to you and your clients, especially when your business is still in its infancy. Remember you are working with clients who are facing foreclosure and are at risk of losing their homes. You would be taking on a huge responsibility if you did not have any prior knowledge or experience, so forming an association with an outsourcing company makes sense.
Credibility is also another reason for using an outsourcing company. Using a company that has been in the marketplace for a number of years and has a good reputation makes good business sense. Since the number of foreclosures increased dramatically a couple of years ago, many new companies sprung up to cash in on the surge in the market. You should carefully research the background of any company you intend to become involved with and choose one that’s been around prior to the upturn in the market in 2005. This should give you and your client’s piece of mind that you are dealing with a credible company. You should also look for a company that has a history of getting the deals done in the best interest of the clients. Look for a company that has recorded testimonials from satisfied clients. It costs a lot more money to produce an audio testimonial than just a few written words on a website. While this is still no guarantee that the testimonials are indeed real, it does give more credibility to the testimonials as even false ones are very costly to produce. You should also take into consideration the matter of liability.
Not all companies work in the same way, so research this aspect thoroughly before committing to any association. Some companies may ask you to set up escrow or trust accounts, some may even ask you to set up an LCC. The reason for this is they will want you to collect client’s fees. If you wan to avoid having any liability then you want to find a company that will collect the fees directly from the client. You will also have to make sure the clients are signing contracts with the company as the main service provider. If you ensure these two points are being followed, then you will only be an independent contractor for that company and they will be liable as the contracted service provider if anything were to go wrong. Other things to consider are the support structures the company has in place. Do they provide training? Will they provide the marketing and tools you may need to initially establish your business? Most credible companies will have all these support structures in place. To get you started a legitimate company will charge you a fee of around $1500-$3500, a fee well worth paying if you get the right company for you and your clients. Let’s go over once more all the points we’ve covered so far if you’re thinking about a career in Loss Mitigation.
You will need to find an outsourcing company that will provide a quality service at an affordable price for your clients. The company should provide you with training, and support and services for both you and your clients. They should take care of all the contracts, handle the appropriate paperwork and collect all fees. They should also have a proven track record in the business. These are all important features to look out for as they will be beneficial in helping you in your new business as well as helping your clients. This can be a very profitable business, but you should research the options available to you thoroughly before making any decisions. Doing so will be in your best interest and will also benefit the families you are helping. I have researched many of the companies that are out there offering Loss Mitigation services and the only one I have so far found that meets all the requirements outlined in this article is Freedom Foreclosure Prevention Services. You can learn more about this vibrant, expanding company at their corporate website ffpswebinar dot biz.