Quote from Roman on August 28, 2024, 6:20 pmHello everybody!
Could you please share your experience on how you manage calls to borrowers, especially when you're handling the first contact after purchasing a non-performing loan and are servicing the debt independently without using a servicing company?
In my situations, the borrower is already in foreclosure under a senior loan and may not be interested in speaking to a second lender—particularly if the lender (like me) doesn’t speak English fluently. It’s quite possible the borrower might simply hang up, saying, "I don’t understand you."
The challenge is further complicated by the small payoff amount of $3.5K for the NPL. Despite sending numerous requests for assistance to servicing companies and lawyers, I’ve either received no response or been told, "With such a small payoff, it won't be profitable for you to use our services."
I’ve seen recommendations in credit note training courses to hire a virtual assistant (VA), but there are pitfalls here too. Even if I fully train a VA from, say, the Philippines in the necessary terminology, there's no guarantee that their English will be strong enough to understand sarcasm or idioms. Moreover, I would need to share sensitive information about the borrower, including their initial loan amount and debt.
There are also compliance requirements to consider when speaking to borrowers, which prohibit me from disclosing their financial situation to third parties (like a VA), especially if they are non-U.S. residents! This could open the door to potential fraud, where some VA could impersonate an employee of my company and deceive the borrower into transferring money to a shell company, thus defrauding both the borrower and lender.
I'm considering another solution to my problem: hiring a translator with whom I can sign a non-disclosure agreement. The cost is $100 per call, up to 1 hour. However, what do I do if the borrower says something like, "I'm busy, I'll call back when I'm free"? I can't keep the translator on hold indefinitely, waiting for a callback that might never come. When it comes to the specifics, dozens of questions arise.
Below is a request that I sent to service companies and lawyers living near the debtor:
--
I am seeking a one-time, ad-hoc negotiation for loss mitigation with a borrower, for a flat fee.I recently purchased my first Non-Performing Note, which has a small balance (a HELOC with a pay-off of just $3.5K). After sending the "welcome package" as the new lender, I need to make my first call to the borrower.
My goal is to have just one phone conversation to avoid any misunderstandings between me and the borrower.
During the call, I need to ask questions (according the Fannie May/Freddie Mac Form 710) to assess the borrower’s current financial situation and their ability to meet obligations. I also want to explore whether they are willing to consider a deed in lieu in exchange for debt forgiveness and a correction to their credit rating. Based on their responses, I will then develop various options for resolving our mutual situation.Since English is not my first language and I have a noticeable accent, I want this first call to go smoothly. Therefore, my representative should be knowledgeable not only in real estate and finance but also in legal and judicial matters, as the foreclosure process on the first loan is actively underway. Additionally, they should be able to understand potential idioms, sarcasm, and humor in the borrower's speech.
The borrowers live in <city and state of borrower>.
--
Hello everybody!
Could you please share your experience on how you manage calls to borrowers, especially when you're handling the first contact after purchasing a non-performing loan and are servicing the debt independently without using a servicing company?
In my situations, the borrower is already in foreclosure under a senior loan and may not be interested in speaking to a second lender—particularly if the lender (like me) doesn’t speak English fluently. It’s quite possible the borrower might simply hang up, saying, "I don’t understand you."
The challenge is further complicated by the small payoff amount of $3.5K for the NPL. Despite sending numerous requests for assistance to servicing companies and lawyers, I’ve either received no response or been told, "With such a small payoff, it won't be profitable for you to use our services."
I’ve seen recommendations in credit note training courses to hire a virtual assistant (VA), but there are pitfalls here too. Even if I fully train a VA from, say, the Philippines in the necessary terminology, there's no guarantee that their English will be strong enough to understand sarcasm or idioms. Moreover, I would need to share sensitive information about the borrower, including their initial loan amount and debt.
There are also compliance requirements to consider when speaking to borrowers, which prohibit me from disclosing their financial situation to third parties (like a VA), especially if they are non-U.S. residents! This could open the door to potential fraud, where some VA could impersonate an employee of my company and deceive the borrower into transferring money to a shell company, thus defrauding both the borrower and lender.
I'm considering another solution to my problem: hiring a translator with whom I can sign a non-disclosure agreement. The cost is $100 per call, up to 1 hour. However, what do I do if the borrower says something like, "I'm busy, I'll call back when I'm free"? I can't keep the translator on hold indefinitely, waiting for a callback that might never come. When it comes to the specifics, dozens of questions arise.
Below is a request that I sent to service companies and lawyers living near the debtor:
--
I am seeking a one-time, ad-hoc negotiation for loss mitigation with a borrower, for a flat fee.
I recently purchased my first Non-Performing Note, which has a small balance (a HELOC with a pay-off of just $3.5K). After sending the "welcome package" as the new lender, I need to make my first call to the borrower.
My goal is to have just one phone conversation to avoid any misunderstandings between me and the borrower.
During the call, I need to ask questions (according the Fannie May/Freddie Mac Form 710) to assess the borrower’s current financial situation and their ability to meet obligations. I also want to explore whether they are willing to consider a deed in lieu in exchange for debt forgiveness and a correction to their credit rating. Based on their responses, I will then develop various options for resolving our mutual situation.
Since English is not my first language and I have a noticeable accent, I want this first call to go smoothly. Therefore, my representative should be knowledgeable not only in real estate and finance but also in legal and judicial matters, as the foreclosure process on the first loan is actively underway. Additionally, they should be able to understand potential idioms, sarcasm, and humor in the borrower's speech.
The borrowers live in <city and state of borrower>.
--
Quote from Bill on August 30, 2024, 11:38 amThe reality with borrowers are they may ignore you until they have to deal with the debt. Don't worry about the accent. I'm not a big fan of hiring a VA for loss mitigation and borrower outreach. Always keep the conversation clean and professional. Call during the week and during business hours. If you're leaving a message, state who the message is for, state your name, your title, who you are with and how they can contact you. I'm just an asset manager or an asset specialist that works for the company, even if I do own it. Be careful about leaving to much information on voicemail. If you do get them on the phone just be real clear on what it's for. The more information you have on the mortgage and the original terms, gives you credibility on owning the debt. I'm a big fan off the 3 Questions, and then let them do the talking.
- What happened?
- Where are you at now?
- What would you like to do about it?
All 3 of these Questions are open ended for a reason. It’s to allow them to open up to you and tell you a lot of information. It’s your job to sit back and just listen. By just listening, they will tell you a lot. Listen and find out what the problem is. So you can solve their problem and start putting a Plan together that will solve their problem. Be compassionate and treat them with respect, because something happened in their life, that was unexpected and they’re just trying to get things back to normal. It’s you job to do that for them, it’s not to cause them more stress. I always go out of my way for borrowers, I don’t chase them, but I help the ones that want my help. I don’t call relatives and I don’t reach out through Social Media. I use to do that, when I first started in this business, but with all the Rules & Regulations. I feel it’s in my best interest to avoid those two methods. I always make sure they know that I work for the company. I always make them know, that it’s my job to help them resolve this and that I will do all I can do to work in their best interest, they just need to follow my processes. Remember, the more problems you solve, the more successful you will be. That’s in this business and in all businesses. If they say they don't have the money to pay back the debt. Talk about The Family & Friend’s Program. Everyone has Family & Friends, that would like to help them out, if they really need help to save their house from foreclosure. Give the borrower's ideas.
I hope this helps.
The reality with borrowers are they may ignore you until they have to deal with the debt. Don't worry about the accent. I'm not a big fan of hiring a VA for loss mitigation and borrower outreach. Always keep the conversation clean and professional. Call during the week and during business hours. If you're leaving a message, state who the message is for, state your name, your title, who you are with and how they can contact you. I'm just an asset manager or an asset specialist that works for the company, even if I do own it. Be careful about leaving to much information on voicemail. If you do get them on the phone just be real clear on what it's for. The more information you have on the mortgage and the original terms, gives you credibility on owning the debt. I'm a big fan off the 3 Questions, and then let them do the talking.
All 3 of these Questions are open ended for a reason. It’s to allow them to open up to you and tell you a lot of information. It’s your job to sit back and just listen. By just listening, they will tell you a lot. Listen and find out what the problem is. So you can solve their problem and start putting a Plan together that will solve their problem. Be compassionate and treat them with respect, because something happened in their life, that was unexpected and they’re just trying to get things back to normal. It’s you job to do that for them, it’s not to cause them more stress. I always go out of my way for borrowers, I don’t chase them, but I help the ones that want my help. I don’t call relatives and I don’t reach out through Social Media. I use to do that, when I first started in this business, but with all the Rules & Regulations. I feel it’s in my best interest to avoid those two methods. I always make sure they know that I work for the company. I always make them know, that it’s my job to help them resolve this and that I will do all I can do to work in their best interest, they just need to follow my processes. Remember, the more problems you solve, the more successful you will be. That’s in this business and in all businesses. If they say they don't have the money to pay back the debt. Talk about The Family & Friend’s Program. Everyone has Family & Friends, that would like to help them out, if they really need help to save their house from foreclosure. Give the borrower's ideas.
I hope this helps.
Quote from Roman on August 30, 2024, 10:24 pmThank you very much Bill for the quick response and the detailed answer.
I think I didn't present my question quite correctly, since I mostly see the answer to a question I didn't ask: "what and how to say to the borrower?"
The thing is, there are no problems with this, I know very well what and how to say to the borrower. My question is not for those for whom English is a native language and/or for those who independently negotiate with the debtor over the phone.
It is more of a technical nature - how do you formalize the transfer of functionality to your external (for instance, Philippine) assistant and how do you control it?
I asked those who use the service of such assistants to share information.
I have previously reported the reasons for this - the possibility of fraud, compliance and misunderstanding of the subtleties and established phrases of the English language on the part of the assistant.
For example, the word "equity" has several meanings and the correct understanding in the right context will allow the assistant to understand the meaning of what the borrower said. I am not even talking about the existence of thousands of idioms that are not directly translated - you just need to know them to understand what is being said.
Here you write "It's your job to sit back and just listen" - this is a huge problem for a person who does not understand English well! How can it be solved?
I do not even yet know how to record a phone conversation in a simple (free) way for later listening - in the USA, Android on a smartphone blocks such an opportunity.
Thank you very much Bill for the quick response and the detailed answer.
I think I didn't present my question quite correctly, since I mostly see the answer to a question I didn't ask: "what and how to say to the borrower?"
The thing is, there are no problems with this, I know very well what and how to say to the borrower. My question is not for those for whom English is a native language and/or for those who independently negotiate with the debtor over the phone.
It is more of a technical nature - how do you formalize the transfer of functionality to your external (for instance, Philippine) assistant and how do you control it?
I asked those who use the service of such assistants to share information.
I have previously reported the reasons for this - the possibility of fraud, compliance and misunderstanding of the subtleties and established phrases of the English language on the part of the assistant.
For example, the word "equity" has several meanings and the correct understanding in the right context will allow the assistant to understand the meaning of what the borrower said. I am not even talking about the existence of thousands of idioms that are not directly translated - you just need to know them to understand what is being said.
Here you write "It's your job to sit back and just listen" - this is a huge problem for a person who does not understand English well! How can it be solved?
I do not even yet know how to record a phone conversation in a simple (free) way for later listening - in the USA, Android on a smartphone blocks such an opportunity.
Quote from Bill on September 2, 2024, 11:46 amOk. I don't have any experience with VA's handling out reach to borrowers and the loss mitigation process. It's always something that I've done hands on. Best of luck.
Ok. I don't have any experience with VA's handling out reach to borrowers and the loss mitigation process. It's always something that I've done hands on. Best of luck.