Negotiate With Your Lender and Stop Foreclosure

If you’re going through foreclosure and you haven’t spoken with your current lender, you’re not alone. In fact, most people who go through the foreclosure process never even pick up the phone to negotiate with their lender to try and stop foreclosure.

I’ve been a real estate agent a long time, and most of the clients that call me to try and save their home, have never picked up the phone, called their current lender and tried to negotiate and stop foreclosure. Most of the time, it’s a combination of embarrassment and lack of knowledge that makes people reluctant. But if you know just a few simple secrets, you can negotiate with your lender and stop foreclosure. Let me tell you how.

First a Couple of facts About Lenders and Foreclosure:

1.) Lenders hate foreclosures: It costs them money, it costs them time and they will never recoup their losses if your home goes into foreclosure and they have to sell it. The lender will incur attorney fees, Realtor fees, property maintenance fees and a host of other expenses that make the foreclosure process a last resort for them.

2.) Lenders Employ Real, Live People: I understand you are reluctant to negotiate with your lender and stop foreclosure on your home. Many people think of their lender or bank as a large, unemotional institution. But the truth is, the people you will talk to our just that: people. They’ll listen to you situation and will genuinely try to work out a situation that can help them and you. Don’t be afraid.

How to Negotiate with Your Lender and Stop Foreclosure

Hopefully you’re a little less afraid to pick up the phone to negotiate and stop foreclosure . Now you need to know what to say and how to approach the bank when you do call to negotiate:

1. Don’t wait until the last minute: If possible, talk to your bank before you go into foreclosure. If you already are in foreclosure, don’t wait until the last month of the process – call them now.

2. Tell them the truth: If you lost a job, tell them. Medical bills? Tell them. Many times a hardship can help you renegotiate, avoid foreclosure and start getting back on track with the lender.

3. Don’t be afraid to Haggle: Banks hate having one of their properties go into foreclosure. It costs them large amounts of money both in lost income and expenses for attorneys and real estate agents. Use this to your advantage and don’t be afraid to ask for a rate reduction, payment deferments, etc.

If you take anything away from this article, please understand that you can negotiate with the bank to stop foreclosure. In fact, the lenders would rather have you call them than have your home get foreclosed on!

in the rare instance where your lender won’t work with you, you can use one of the systems we’ve reviewed to help you out. See the about me / resource box for a link to our review page.

Good luck and don’t be afraid to negotiate with your bank to stop foreclosure!

New Mexico Air and Water Presents 11 Tips on How to Winterize Your Home

Why Is Pipe Freezing a Problem?

Water expands as it freezes. This expansion puts tremendous pressure on whatever is containing it, including plastic and metal pipes. No matter the “strength” of a container, expanding water can cause pipes to break. Pipes that freeze most frequently, are those exposed to severe cold like: outdoor hose bibs, swimming pool supply lines, water sprinkler lines and water supply pipes in unheated interior areas like basements, and crawl spaces, attics, garages or kitchen cabinets. Also, pipes that run against exterior walls that have little or no insulation are subject to freezing.

To avoid frozen pipes and repair costs, please follow these precautions:

Outside Your Home:

1. Shut off and drain your irrigation system. This may seem obvious, but sometimes people assume that their landscaping company or lawn maintenance company has done it for them. This task only takes a few minutes and can save you hundreds of dollars in repair costs and water bills.

2. Disconnect and drain outdoor hoses. Disconnecting hoses from their spigots allows water to drain from the pipe. Otherwise, the ice formed from a single, hard overnight freeze can burst either the pipe or the faucet. We have seen numerous instances where spigots lines froze over the winter and until a customer notices a high bill in the summer (from hose use) is the broken pipe found.

3. If you have a swimming pool, drain water from pool and supply lines following the manufacturer’s or installer’s directions. Do not put antifreeze in these lines unless directed. Antifreeze is environmentally harmful, and is dangerous to humans, pets, wildlife, and landscaping.

4 Close foundation or exterior vents around the house during the cold months. This will help keep cold air out of crawl spaces.

5. There should be an insulating blanket inside the water meter box on top of the meter. If the blanket is missing, call your local and have the blanket replaced otherwise, the water meter may freeze in extreme cold weather. Please do not replace this specially designed blanket with any other insulation, as this may cause a health hazard. Another type of insulation may not be able to withstand water and other conditions present within the meter box.

Inside Your Home:

6. Insulate pipes or faucets in unheated areas. If you have water pipes in an unheated garage or crawl space under the house, wrap them before temperatures plummet. Hardware or building supply stores offer appropriate pipe wrapping materials.

7. Seal off access doors, air vents and cracks. Repair broken basement windows. Cold winter winds whistling through overlooked openings can quickly freeze exposed water pipes. Avoid plugging air vents that your furnace or water heater needs for safe operation. Keep garage doors closed if there are water supply lines in the garage.

8. Know the location of your master water shutoff valve. In many homes it’s where the water line comes into your house from the street. If a pipe bursts anywhere in the house — kitchen, bath, basement or crawl space — this valve turns off all water and will save your home from damage. So, find it now and paint it a bright color or hang a tag on it. Be sure everyone in the family knows where it is and what it does.

9. Open kitchen and bathroom cabinets to allow warmer air to circulate around the plumbing. Be sure to move any harmful cleaners and household chemicals up out of reach of children.

10. Keep the thermostat set to the same temperature both during the day and at night. By temporarily suspending the use during lower nighttime temperatures, you may incur a higher heating bill, but you can prevent a much more costly repair job if the pipes burst.

11. If you will be going away during cold weather, leave the heat on in your home, set to a temperature no lower than 55ºF.

Avoid the Great Eight When You Negotiate

Everyone knows this axiom: What are the three most important factors in Real Estate? Location, Location, Location. Well, when it comes to negotiation, the three most important factors are Prepare, Prepare, Prepare. Yet lack of preparation is the most common mistake I’ve seen, even among experienced professionals. Here is a list of eight more mistakes that you should avoid in your negotiations:

1. Not recognizing that this is indeed a negotiation. When you’re in the business of selling and buying on a regular basis, much of your time is actually in some stage of the negotiation process. Everything is a trade-off and everything has some degree of value. If you immediately start the conversation by identifying what is of little value to you, you’ve potentially given something away that you could have used in exchange for something later.

2. Thinking this is a zero-sum game. Someone has to win, therefore someone has to lose. I recall one member of a negotiation team who simply couldn’t shake her concern that the other party might be getting “more” than they needed to have in the negotiation, even though we were getting exactly what we needed. She thought we should continue to push because this somehow wasn’t fair. She didn’t seem to grasp that an ideal negotiation has both parties believing they got what they needed.

3. Not establishing objectives up front. I’ve observed that people get very stressed out about negotiations because they are afraid that the other party is going to somehow get the better end of the deal. This, even before they’ve figured out what is a good deal for themselves! In other words, they don’t know what their objectives are. Establishing your objectives not only minimizes the stress of the negotiation, it also helps you know what specifically to ask for, and how far you can go in the negotiation.

4. Not knowing when you’ll walk away. The industry term for your walk away position is the BATNA (Best Alternative To a Negotiated Agreement). In other words, if you can’t get what you want, identify the alternative, and seek THAT. The biggest frustration I’ve observed during negotiations is the feeling that somehow you’re being taken advantage of. This feeling is greatly minimized when you know the point at which you can walk away.

5. Not exploiting time constraints for yourself and for the other party. Negotiations that have no known time constraints can become unproductive quickly. There is always some constraint from one or the other parties, and figuring out what that is can be crucial for pushing closure of items. For one party, it might be making a particular revenue amount in a quarter. For the other party, it might be resource availability for closing the agreement. Understanding these factors is crucial for determining how far issues can be pushed.

6. Not spending sufficient time on what matters to THEM. A successful negotiation allows time for trade-offs between the parties where both feel they have gotten what they needed from the business arrangement. For you as a successful negotiator, you need to know what the other party’s needs are so that you can present alternatives that will optimize both your and their objectives.

7. Mistaking your wants for needs. When you enter a negotiation, there are specific items that you must have in the final outcome (these are your “needs”). This could include things such as a certain cost point, a particular quality level, or a specific timeframe. You will also have particular “wants” which could include the way the item is packaged or a particular contractual clause; but these wants are not make-or-break objectives for the negotiation. The rub comes when you get one of your wants but sacrifice a need in return (I got this great termination clause (which I’ll likely never use), but I’m paying more for the service than I budgeted for!).

8. Inability to re-frame issue to meet both party’s objectives. I heard a great example of this from a negotiation instructor recently. She described a purchase she was making when shopping on a Caribbean cruise: she asked the salesperson what kind of a reduction she could get if she purchased two necklaces instead of one. The sales person said they had a strict policy against negotiating. Instead of walking away from the purchase, this instructor asked the sales person if they did any type of volume discounting. When she described the reduction as a volume discount, rather than as a negotiation, the sales person was able to utilize a different method for giving the reduction to the instructor. The instructor got her discount, and the store made a sale. Both parties got what they wanted simply by re-framing the situation.

If you buy and sell as a profession, you’re probably an expert at negotiations. Yet even the best can afford to resist falling prey to these great eight mistakes.