Overcoming Obstacles.

Oftentimes, life won’t give you a blueprint and the learning process will be through trial and error. However, one can learn through the mentoring and help of others. As a note buyer, wouldn’t you like to know how to overcome certain objections thrown at us by homeowners? If your answer is yes then I suggest you grab a pen, read on, and take notes. We may not answer all your questions, but with a couple of case scenarios you will hopefully have a better grasp on future situations.

For instance, let’s say you are on a call with a homeowner and they say to you,  “I was going to refinance the house and that’s gonna take me a couple of months but then I'll pay you off.” What should your response be? You could start by saying something along these lines, “John I think that is not a bad idea. It’s a good plan, but I want to explain how the process works. When you go to apply for a refinance, they’re going to do whats called a V.O.M with us, which stands for verification of mortgage. They will want to know if you made 12 payments in full and on time in the past 12 months. Since you have not, it’s not going to be possible for you to refinance at the current time. However, if that's what you want to do I’d like to put you on a plan that will put you in that position at the end of a year.”

A verification of mortgage is a piece of paper that comes out to you, the second lien holder, that asks you to verify that the homeowner has made the payments the past 12 months. It is important to be truthful about it because lying to a bank would result in bank fraud which is  illegal.

Another objection could be when a homeowner says to you “I can’t talk now because I'm at work.” You can respond to that with, “Hey John, no problem. Let me get some contact information from you such as your home number and your cell number and as long as you communicate with me I promise I’ll never have to call you at work again.”

A common objection - “I need to talk to my spouse,” says John. Respond by saying, “Hey John I completely understand that, I consult my wife for everything. I don’t go and decide what we’re going to have for dinner without her so I get it. This is a lot more important than that, but let me ask you this John and I won’t hold you to this but what is your gut telling you to do.” This way, you advance the conversation forward because the homeowner doesn’t feel threatened. See, there are four parts to any conversation with a homeowner: a yes, no, a continuation, or an advance. According to basic sales 101, you want to avoid is the continuation, which will cost you time and consequently money. You ultimately want them to make a decision. At times, they tell you no, that they do not want to stay in the home, which is not the end of the world. This way, you know which path you are going to go down - exiting through the property.

Be positive and show the homeowner that the decision is not all about what the company wants, but rather centered around him/her. If a homeowner is still difficult by saying that because they can’t meet requirements they will be filing for bankruptcy, it is okay. Chances are that they do not really understand the process. Your job will be to explain it to them. What will you say? You can tell them that when bankruptcy is filed (Chapter 7), since it’s a secured debt tied to their property, the debt will not go away. They will no longer be personally liable but if they want to keep the property they will have to pay the property’s debt.

With an equity deal in  Chapter 13 bankruptcy - let them know that they will have to make the regular payments and if for example they are $5,000 in arrears, that amount will also be spread out over the five years duration period. If the house has no equity or is under water, the debt does not immediately disappear either. A portion of all debt included in the bankruptcy must be paid for 60 months to the bankruptcy trustee, who keeps about 10% as payment. Let’s say you miss two months of payments, which leads to being kicked out. You’ll actually only be that much further behind. Also inform the homeowner(s) that they are going to have much more to pay in legal fees, in addition to all other payments. The chances of a homeowner actually going through with bankruptcy are about 1 of 10.

These are just some scenarios that note buyers may deal with. It is our wish that by showing you some of the strategies we have  learned along the way, you will be  better equipped when  dealing with homeowners. If you have further questions in relation to note ownership, please visit the NNG website at http://www.nationalnotegroup.com/ or visit us on Facebook at https://www.facebook.com/pages/National-Note-Group/529259247086369.