While Obama’s “Making Home Affordable” program which includes both HAMP (Home Affordable Modification Program) and HAFA rolled out earlier this year, despite the many news briefings, articles, lender notifications to defaulting borrowers and the Real Estate Agents canvassing their market niches, there hasn’t been enough time as of yet for the entire jury to return.
These programs were intended to both incentivize lending and servicing institutions to cooperate and to streamline the “Short Sale” process currently plaguing distressed homeowners across the nation. As HAFA rolled out on April 5th, many direct lenders had only provided their loss mitigation staffs with minimal information.
Another Stop gap was given when it was announced that both Freddie Mac and Fannie Mae, the two largest mortgage securers in the country were exempt from HAFA guidelines provided they invented their own. Both of these organizations have now published their versions which mimic Obama’s with only slight variances, and some between each others. One may look out and observe this alone as a recipe for confusion for the industries that must facilitate these sales as Real Estate Agents and major Banks collect the questions and concerns of millions of borrowers already distressed by their personal hardships.
While it should not be a ‘news flash’ today that the world of real estate has taken itself upside down over the last three years, some distressed homeowners still have little idea that help has been available through “the Short Sale”. Public awareness media has now taken the shift to the HAMP and HAFA process while a large segment of the default population will prove to rest outside of HAFA’s eligibility requirements. The guidelines are specific to homeowners who reside in their homes as their primary residence, exempting those who have vacated their homes without proof of recent relocation and investment property owners. These situations may still be reviewed through the traditional short sale process for those who qualify.
What presses my attention in this writing is that very few Realtors and Lenders have enough of these closings to provide relevant testimony as to the success of these programs for reality inspired seekers of truth. Secondly, I still sleep rather dumbfounded at the level by which real estate Agents have electively pursued the educational opportunities available in this pre-foreclosure specialty. There exist dozens of recognized real estate trainers and both private and Realtor Association certifications which endorse this pre-foreclosure market as a specialty. While this education is verifiably fundamental, it is in likeness to differences between what is studied in preparation toward passing a licensing exam the street knowledge successful Agents found necessary to conquer ‘Million Dollar Club’ recognition.
A dangerous element the industry had witnessed in the category of education was oriented toward the advantage of investment buyers teaming with real estate attorneys boasting theories which provoked real estate Agents to secure low ball offers shortly after showcasing their listings in order to “get the ball rolling”. The old ‘Blood in the Streets’ movement sought claim to being the hero to both the distressed and to hungry Agents who may have had little memory of the short sale cycle of the mid 90’s. It is almost humorous to me that the many who had driven this investment philosophy the first year of this market turning era in 2007 are now victims of distress themselves or are defaulting on mortgages strategically.
In respect to positive turning of tides, Realtors who are setting a responsible example of professional expertise have not only graduated recognized professional designation courses, they have also invested in other educational seminars which expand on these and offer additional practical, theoretical and psychological training in dealing with both counseling distressed homeowners along with compassionate and tactical methods of dealing with their uneducated Agents counterparts whom are likely to bring forth their awaiting Buyers. These are the ‘New School’ Agents of our time.
This raise of the bar is as equally important in my opinion and is an element of what I saw missing when my Short Sale training seminars were incepted and are currently offered to Agents in Southern California under the title of “The Short Sale SHIFT”. Agents interested in more information on these courses may inquire directly through The OracleGroup, Los Angeles, contact me directly or may pre-order my book scheduled to be released this August.
Until then, it is currently a coming beautiful day in Southern California and my heart extends a wonderful wish to everyone for a safe, healthy and happy 4th of July this weekend.
Bryan Ridgley
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