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Want RE Agents to Knock Down Your Door? Free Marketing Piece

Home Forums General EHTrust/EHT Topics and Creative Real Estate Financing Want RE Agents to Knock Down Your Door? Free Marketing Piece

This topic contains 33 replies, has 0 voices, and was last updated by Avatar of dave salcido dave salcido 8 years, 10 months ago.

Viewing 15 posts - 1 through 15 (of 35 total)
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  • #6606
    Avatar of dave salcido
    dave salcido
    Member

    Many of you have been asking for some extra marketing help; especially with information going out to real estate agents. Here’s a marketing piece I use. You are welcomed to use it as part of your marketing strategy. If you get any bites and want to co-op, let me know. Go for it and Good luck!

    Real Estate Agents Needed!
    Houses not selling? Forward thinking Real Estate pros have the new solution! It’s called an Equity Share.

    (See NY Times Report “Fixing the Mortgage Crisis”)
    http://www.nytimes.com/2011/01/06/opinion/06perriello.html

    Was your homeowner rejected from bankruptcy, short sale or loan mod? Is the mortgage underwater? Is foreclosure looming? No Problem. Help the homeowner and lender enter into a HOPES Equity Share and get your commission while saving your client.

    Here’s how it works:
    1. The homeowner places their property into an Equity Holding Land Trust (50% Co-Beneficiary)
    2. The Homeowner deeds equitable title to a 3rd party corporate trustee
    3. The Homeowner gives the Lender (mortgage holder) a 50% Co-Beneficiary Equity Share in exchange for a modified, affordable mortgage payment
    4. The Lender receives regular monthly mortgage payments and 50% of all future equitable growth of the property (akin to a joint venture on a real estate investment)

    Benefits to Homeowner
    1. Avoids foreclosure due to high payments and property devaluation
    2. Maintains good credit
    3. Retains property use and fee simple benefits including tax deductions
    4. Maintains property management as a performing and valuable real estate asset
    5. Investment protected 100% with additional 50% windfall on future equitable growth

    Benefits to Lender
    1. Property remains a performing asset on their books
    2. Avoids costly foreclosure and repossession costs
    3. Avoids costly principal reduction and devaluation events
    4. Easy way to maintain asset performance (eviction vs foreclosure)
    5. Investment protected 100% with additional 50% windfall on future equitable growth
    6. A new marketable investment instrument that can be traded on Wall Street (Beneficiary Interest in a Trust or BIT)

    Benefits to the agent
    1. Full commissions available on underwater properties
    2. Real estate values stay up (so do commissions)
    3. No messy and unpredictable short sales transactions
    4. Property management opportunities
    5. You become the true transactional expert in your community

    Real Estate Agents are needed to help put HOPES Equity Shares together. I am looking for like minded real estate professionals that would be interested in the concepts I have outlined and I believe you and I might be able to benefit each other in this cause.

    I have included a 30 minute video and a white paper that explains HOPES in more detail and I have an accompanying video preview for your consideration. Let’s talk!
    Your Name
    Your Phone Number

    http://www.viddler.com/explore/DaveSalcido/videos/16/

    #33319
    Avatar of amyhutton
    amyhutton
    Participant

    So the owner gets a 50% interest and the lender gets a 50% interest.

    The NARS member pays for the trust setup. Where’s our profit?

    The Realtor gets his commission probably paid by the bank. The owner is staying in the house. There’s no RB to bring in upfront cash.

    Am I the only one here that isn’t clear on where our profit would come from when we referred a homeowner or Realtor to the HOPES program? What do I get out of finding a Realtor with a house to put thru the program?

    Amy

    #33320
    Avatar of dave salcido
    dave salcido
    Member

    @amyhutton wrote:

    So the owner gets a 50% interest and the lender gets a 50% interest.

    The NARS member pays for the trust setup. Where’s our profit?

    The Realtor gets his commission probably paid by the bank. The owner is staying in the house. There’s no RB to bring in upfront cash.

    Am I the only one here that isn’t clear on where our profit would come from when we referred a homeowner or Realtor to the HOPES program? What do I get out of finding a Realtor with a house to put thru the program?

    Amy

    The answer to your question depends on what you bring to the table. What is your value? What is your worth? Are you one of the millions of bird dogs out there that believe the real estate industry would not function without the bird dog? Or would you be serving in the capacity of a co-beneficiary “Manager” or “Transaction Coordinator”? Are you a master negotiator? Can you close the deal? The answers to these questions will dictate what kind of beneficiary interest you could command.

    On over-encumbered situations, like the ones we see so often today, I will “bump” equity to get “paid off” at closing and/or over time in installments.

    http://www.reidepot.com/articles/Gatten/Bumped.html

    If I have to take payments, I do not sell off my percentage interest, so the homeowner and lender better pony up at closing.

    Knowing how to find the income streams comes with time and most importantly, transactional experience. Having a good coach in your corner doesn’t hurt either.

    Note: Initial percentages in my offer are merely baselines, not absolutes. I ultimately negotiate hopefully to everyone’s satisfaction.

    #33321
    Avatar of corkhorner
    corkhorner
    Participant

    good questions, Amy. Stay with it.

    I think Dave ‘May have ‘ left out variable beneficiary portioning.

    c h

    #33322
    Avatar of dave salcido
    dave salcido
    Member

    @corkhorner wrote:

    good questions, Amy. Stay with it.

    I think Dave ‘May have ‘ left out variable beneficiary portioning.

    c h

    Not to point any fingers, and said with the utmost respect, but all variables are covered when I have all of the mathematical components in place. Otherwise, we are left to merely speculate.

    Again, said with love…..those with the most working transactions seem to have the least amount of questions.

    Please, try to get a transaction in the hopper and any learning curve will disappear.

    #33323
    Avatar of dave salcido
    dave salcido
    Member

    @amyhutton wrote:

    Am I the only one here that isn’t clear on where our profit would come from when we referred a homeowner or Realtor to the HOPES program? What do I get out of finding a Realtor with a house to put thru the program?

    Amy

    Let me add an additional thought on this subject. It is not hard to find Realtors with deals. Many homeowners have failed in bankruptcy and loan mods and are now facing foreclosure. The key is finding NARS people that know how to make offers and get them signed. That is not a bird dog. That is a skilled EHT pro. The second component of an Equity Share may involve negotiating to the satisfaction of the lender (over-encumbered properties where the homeowner is in distress).

    What the homeowner really needs is a “Transaction Coordinator” for HOPES offers. A signed NEO from a trained NARS member or a property placed into an Equity Holding Trust is imperative to continue. That’s why training is so important. Those that I co-ben with will have enough knowledge to know how to make the offer, how to present it, how to get it signed and how to process accompanying docs for trust set up. From there, I can tie up loose ends with the homeowner and then start the negotiations with the lender.

    So, if you want to be a bird dog, you can, but your bird dog fee will be minimal (maybe $500-$1000 if the deal goes through). I will set you up with a trained NARS Transaction Coordinator that can take your lead and make the offer to the homeowner. If you want more than that, we can discuss an arrangement but training must be included to understand protocol.

    #33324

    A HOPES Transaction is nothing more than a regular EHTrust transaction with the bank as a co-beneficiary. The Homeowner having benefited from a partial or full elimination of the over-encumbrance and a lower payment. The Bank and remaining co-beneficiaries will share any future equitable growth and appreciation, say over 5, 10 or 15 years, until such time as the property is either sold or the homeowner refinances.

    If I were the homeowner I’d get my act together ASAP so that I could refinance, terminate the trust, pay off the bank and other beneficiaries so that I could keep as much of the growth and appreciation as possible unless there is a minimum time set for the trust.

    The homeowner, or any one of the beneficiaries can pay the closing costs, estimated to be from 2 to 5 points of the MAV. The bank may even agree to pay for the entire thing as opposed to paying 5% to a Realtor for a Short Sale Commission. The costs may also be shared among the beneficiaries if they’d like, just like any other EHTrust arrangement.

    As a NARS Network Member, part of your “profit” may be in your discount plus a point or so upfront. There may even be some build in Cash Flow for the Licensed Realtor Trust and Transaction Manager. This may also help you understand why I’m considering obtaining my RE License.

    Like Dave said, depending on your level of participation, either just handing over the transaction for a small fee or if you are going to handle making the offer, preparing the docs that go to the bank, etc, will determine your percentage of the net profits.

    The offer to the bank MAY NOT even ask them to reduce the over-encumbrance at all but rather just lower the monthly payment so that it is affordable for the homeowner to stay in the property. Is this a Loan Mod? I suppose it mimics one, but is not one at all. In a loan mod the property is still considered a non-preforming asset, and without any further to the homeowner, can still be foreclosed on.

    If the Bank agrees to lower the payments so they are affordable and results in creating a preforming asset for the bank, who cares what the actual loan balance is right now. Of course, our HOPE is that the bank will reduce some of the over-encumbrance as well as lower the payment. All we can do is ask, right?

    Just hypothetical here but it may look like this…

    Current Loan/s: $400,000
    Current Value: $300,000

    Trust MAV: $350,000 because maybe the bank agreed to a partial principle reduction in exchange for a 50% Interest in the Trust.

    Homeowner now Settlor: 0% interest in the trust. Oh but Scott, doesn’t the Settlor need to remain “A” beneficiary of the trust? Really? Why? Think about it for a minute. Perhaps they may, but it may no longer be required. Does it make you wanna say… hmmmmm!

    Remaining Co-Ben’s: Split the remaining 50% based on their participation???

    Maybe the bank could or would agree to 75% in return for a total elimination of the over-encumbrance. It’s all negotiable, right?

    There may be a few more “players” in a HOPES deal, so how do you make a profit on a HOPES Transaction? Just like you would in any other EHTrust transaction. The more you do, the more you make.

    Just my .02!

    #33325
    Avatar of amyhutton
    amyhutton
    Participant

    Thanks, Scott. That clears up a lot.

    Amy

    #33326
    Avatar of garydunn
    garydunn
    Member

    Group,

    I understand HAMP is for home owners = owner occupied and the owner has to be late on at least 1 payment.

    Is HOPES for non occupied = investment properties? Does the owner have to be late on a payment?

    Gary

    #33327

    There are no restrictions or limitations to HOPES.

    #33328
    Avatar of garydunn
    garydunn
    Member

    Group,

    @Scott_L._Moyes wrote:

    There are no restrictions or limitations to HOPES.

    Here is where I am having trouble understanding Hopes.

    Every loan/mortgage has a servicer. About 15% of lenders service their own loans. Lets leave that “in house” set up aside for clarity of this example.

    Example:
    ABC Servicing services loan #1234 for XYZ Big Bank. The loan was originated January 1st 2006, before equity sharing appeared.
    The loan is current on payments, but with falling home values the LTV is 200%. Owner occupied, single family residence.
    A Hopes request is received by the servicer.
    ABC Servicing references the #1234 Servicing Agreement, finds nothing about equity sharing, nor finds any clause in the agreement to reduce principal for a performing loan, nor finds any clause in the agreement to provide assistance when the Hopes request shows no obvious financial distress or impending future distress for the home owner. The servicer rejects the Hopes request.

    Where does Hopes think it has a magic bullet that the servicing agreement will be thrown to the side just becuase equity sharing is mentioned? From the material presented online I see nothing in an equity share proposal that would make the servicer differentiate the Hopes request from a Loan modification or short sale request.

    Gary

    #33329
    Avatar of dave salcido
    dave salcido
    Member

    @GaryDunn wrote:

    Where does Hopes think it has a magic bullet that the servicing agreement will be thrown to the side just becuase equity sharing is mentioned? From the material presented online I see nothing in an equity share proposal that would make the servicer differentiate the Hopes request from a Loan modification or short sale request.

    Gary

    First of all, HOPES is not a magic bullet. It was never intended to be. Secondly, equity sharing has been around a lot longer than even mortgages. That said, understand that a HOPES Equity Share offer should bypass the servicer and the servicing agreement altogether. A servicing agreement is just a piece of paper; subject to change if it makes sense to an investor. An equity share agreement is made directly to the investor as a more lucrative alternative to an investor’s inevitable choice of doing a loan mod, short sale or foreclosure. They either accept an equity share as a better move for their books or they don’t. And the structuring of the equity share has to make sense from a profitability and a logistical standpoint. It’s as simple as that.

    How does HOPES differ from a loan mod or a short sale? Ownership and control. With a loan mod, the investor has legal title but not equitable title. With a short sale, the investor will relinquish both, but the costs for doing so cuts into their bottom line. If the value of HOPES is appreciated, the investor will have total control of the asset without losing a penny and will gain additional profits from future equitable growth to boot.

    To me, it’s a no brainer. Smart investors should hopefully also recognize the benefits. Why would an investor consider equity sharing? I think the answers make it obvious. Why else would HAMP incentivize lenders for creating homeowner/lender equity shares? It reduces tax liabilities to the public and slowly transitions HAMP out of the “banks too big to fail” charity business. HOPES will also keep real estate values from decreasing, neighborhoods vibrant and the economy more stable. This is also better for the investor than owning a non performing asset (REO or defaulted loan). With balanced books, they can also continue to “lend” like crazy.

    I will grant you the fact that investors that are receiving regular on time monthly payments will probably not pay too much attention to HOPES until their cash cow stops providing milk.

    #33330
    Avatar of mtnwizard49
    mtnwizard49
    Member

    Just a note…Equity Sharing first appeared with Paul Simon in the late 1970′s.

    #33331
    Avatar of peter@amakya
    peter@amakya
    Member

    David, the presentation is very good. Can you edit it down to say 5 or 10 minutes?

    #33332
    Avatar of corkhorner
    corkhorner
    Participant

    say more, Doctor, re Paul Simon….did he have that in the lyrics of his songs?

    :)

    what happened after he ‘intrduced it’?

    My view?

    ‘IF’ Big Money’ and The Street controls our legislative branch of gov via lobbyists, trips, gifts, Glamlorous Hotel/Carribean junkets of all dimensions THEN the mortgage meltdown is far far from over. FAR.
    Who knows the future around the bend from that group in Washington dc?

    Anyone who thinks they will outguess that avenue will be doing a lot of re-evaluating.

    There was a pop mag called Changing Times. Is it still around or get ‘changed’ right out of existence?

    Change is Good, when ya can go with the flow?

    Right, Doctor?

    c h

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