Ever wonder how the lenders and asset managers think?

FOR IMMEDIATE RELEASE

Contact:
Lillian Walker
REO Broker Owner Auctioneer
Exit Beach Cities Realty
714 847-3454 x 307
LillianWalker@verizon.net

Ever wonder how the lenders and asset managers think?

Can you imagine getting inside that head?

Huntington Beach, Ca (Grassroots Newswire) 4-23-09 -- Do you ever wonder what are the lenders thinking? What's there mindset or where are they coming from?

Well, you are not alone, in fact realtors, buyers and the whole country is wondering. Having been a lender in the past I can share with you some insights. First thing is first, remember the obvious. THEY ARE LENDERS! Not sellers of real estate, they have the unfortunate situation of having to take their collateral back because the folks who promised to pay and put up their house for collateral could not swing the payments. OUCH!

Now they get this house back and they don't have a clue of the process but they do know how to make loans on homes. So when they have an REO broker list a home for sale they require a package that has a stunning resemblance to YOU GUESSED IT: A LOAN APPLICATION. Yes indeed things like what I like to call the Big 5:

1. Letter of approval
2. Proof of funds,
3. fico scores/credit
4. deposit check
5. Purchase contract.

Why? Because they are lenders, they are most concerned with exposure, liability and risk. That's why a loan package is about 100-150 pages most are CYA forms to protect them because they are telling you "they told you so" also known as "disclosures" and "acts" letting you know what your rights are and only four are the actual loan application (1003 FNMA) form. When you submit offers to them they are underwriting "a loan" for a purchase. This is another reason why they prefer letter of approvals from direct lenders because they themselves are direct lenders and they know how that works. They look at the deal and they want two things: the deal with the highest net/bottom line and the one with the highest probability of closing. They are all about the numbers.

The other thing to keep in mind is that banks are laced with heavy bureaucracy. Lot's of people handling very small areas of scope in responsibility. Once person "A" is done registering the deal it goes to person "B" who uploads all the documentation who gives it to person "C" who verifies receipt and confirms the deal is complete otherwise they kick it back to "B" Then "D" gets the package and they actually underwrite or approve the purchase and they hand it to "E" who works out the numbers and preps it for "F" who will handle the closing of the file. Next "G" Receives the file and this goes to compliance who then passes it "H" who pick's 25% of everything closed to conduct an audit to make sure everything was handled properly and the lender is not in any breach of any federal regulations or laws. Every lender has some variation of this set up.

Some lenders lean heavy on their REO listing agents while others are very impersonal there is no rhyme or reason. Most only allow e mail communication. Why? Because as lenders everything done on a file has to be entered into a conversation log that is time dated and stamped. E mail is ideal is a no brainer because they just cut and paste it into their conversation logs.

The other thing to keep in mind is that when submitting an offer you have to have 100% of the package complete when presenting an offer. Nothing can be missing, not a deposit check, not an agency disclosure, not a proof of funds. Either you have your entire package with the big 5 and you follow their instructions listed in the private remarks regarding their preferred method of receiving delivery of the purchase offer or you are out of luck. Only one third of all offers made on REO's right now are even eligible to participate in "the lender's dance". The other two thirds can't even be considered to be toilet paper, because toilet paper has a use! This documentation goes straight to the trash. It's not their job to educate realtors or buyers. They are too busy for that. On the retail loan side it's not much different. If a loan application package is not complete a loan processor will put the file in suspense before it is sent to the underwriter. You see the similarities?

So remember who you are dealing with. No luck changing them! Realize they are lenders who just happen to have a house for sale.

Does this make sense? I hope it does. Next I will talk about strategies to implement in addition to this information to increase your batting average when dealing with multiple offers on REO's.

The market is getting better every minute!

For more information about Exit Beach Cities Realty, please call 714 847-3454 x 307. Exit Beach Cities Realty is located at 7152 Edinger Ave Huntington Beach Ca 92647 The Official Real Estate Company of The Home & Garden Home coming to SoCal May 29th-31st at the Anaheim Convention Center.

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Documents and/or Photos available for this release:

Lillian Walker-Exit Beach Cities Realty Huntington Beach California Broker Owner
Lillian Walker Exit Beach Cities Realty Huntington Beach California

To view supporting documents and/or photos, go to www.enr-corp.com/pressroom and enter Release ID: 203796