[Note: To follow is an excerpt of a radio show interview conducted by Peter L. Mosca, host of Income Property Investment Talk dot com, with Linda Yates, who develops and leads the Real Estate Training Division on behalf of Foreclosure.com. To learn more about Foreclosure.com's programs, go to http://plm.theagentuniversity.com. To listen to the show archive or download an MP3, go to www.IncomePropertyInvestmentTalk.com/032410.]

Mosca: Can you tell us about Foreclosure.com and what you do there?

Yates: Foreclosure.com is the largest portal laying out real estate investment opportunities. It covers pre-foreclosures, foreclosures, auction properties, for sale by owners, bankruptcies, and tax liens. A very large website – if you do any search on foreclosures, you're going to find our site prominently. It has over 6 and ½ million visits per month to the site and over 70 million page views per month, so we get a lot of traffic. A lot of people come to us to look for great deals. One of the things that we also have available are alerts that can be delivered into an investors' e-mail box, so if there's new properties that come in an area, that can show up. Foreclosure.com is located in South Florida. We have a national reach and have been around since 1999. I actually met Foreclosure.com back in 2005 and was hired in 2007 to launch their Educational Division. The goal being that we had all these folks – consumers, investors, first-time homebuyers, real estate agents, brokers – that would come to the site, look for our information, look at our data, but a lot of times we were getting questions, especially those folks who were new to real estate and not understanding how to use the data saying, "Can you help me and walk me through that process?" So the leadership here determined that it would be a good thing to launch an education division and I was brought in about three years ago to do that.

Mosca: How does that work?

Yates: We get data from thousands of sources across the country. We have about 75 individuals who work for Foreclosure.com and within that group a large data department. Their job is to synthesize all this data that we're getting, and to report it all and put it out there. We get trigger notices -- notice of default, notice of lis pendens, or notice of trustee sale. Any of those initial triggers that occur when a missed payment has happened on a property between the different sources that we have, we then get the information and we put that on our site. Individuals can sign up for our FREE alerts – those are alerting folks to the fact that this is indeed in a pre-foreclosure status, and there may be an opportunity. We've been doing that for years, and depending on the market –depending on the property, depending on whose property it is, what reason they may or may not be going into default, would then determine whether or not there's equity in that property. Properties that have equity in them are an obvious opportunity for investors to create a win-win solution and get a great deal on that pre-foreclosure stage.

Mosca: Would you say then there's a little bit more to this than just knowledge – it's an ability to really take that data and work it to a point where it makes sense to you as a real estate professional, or to you as an investor?

Yates: It definitely does. We have all sorts of different tools that are available as well on the Web site. We're trying to make it as easy as we possibly can for someone to glance at, to say, "You know what, I see some potential opportunity here. I'm going to check into this further." Then they pick up the phone, and put a call in about a property, see if it is in really that stage just to verify, because again, we're getting data from all these different sources all the time and the site's always being updated, so it's good to just check your data to make sure your data is at that moment the most correct it can possibly be. If there's a bankruptcy process going on, at what point in that bankruptcy process is it at, and does it make sense to move forward now, or am I going to want to sit back as an investor and just watch this for a little bit longer to see what's happening. That's part of what we also show as well on that data – we show some history of what's occurring with that particular property on the site.

Mosca: So then a deal is not necessarily "a deal" unless the data you're interpreting and analyzing makes sense to the investor?

Yates: Absolutely. Typically with the properties and the data we receive, we have someone that you can contact -- a community expert, or someone actually listed with the property like an attorney, or even the bank.

Mosca: We received an Instant Message from a listener. Her name is Liz, who writes, "I have properties in question: lower income, two four-plexes with two different mortgage holders that I have owned since late 2006. Cannot fill it up, negative cash flow. $100,000 each under water. I have already sold one other good property to pay expenses for these apartments. Wishing to do short sales. I have assets, stocks, two other investment properties, and cash. How does that figure into my ability to short sale successfully?"

Yates: That's a great question, and that's definitely a part of what will be looked at and viewed by the lender. The key will be to show a hardship and have a good negotiator. One of the things occurring right now with the HAMP programs -- the Home Affordable Modification Program -- is an opportunity to try to go in there and get loan modifications. If you haven't done that, all is not lost. There still may be an opportunity to do that. They need to understand and what you need to show and illustrate is the different hardship that you're having. The fact that you have other assets – they're going to look at that, too. They're going to want to know exactly what the full picture is, but listing everything out, itemizing that, working with an agent that can help represent you and tell your story effectively will be key for you as well. We've got a large network that we can definitely refer you to. As HAFA (Home Affordable Foreclosure Alternatives) comes out, that may speed up that short sale process for owner occupied properties, whether or not you've gone and applied for the HAMP program. One of the key things in HAFA is 31%, a real important number in order to show you have enough income. At the end of the day that's what the banks are looking at. If it's not a modification, and you are looking at the short sale, then they are going to look at the full picture of what's going on with you in your portfolio.

Mosca: Linda, you had mentioned the HAFA program, when does that kick in?

Yates: April 5, 2010.

Mosca: Liz, hopefully that gets you started in the right direction, and we thank you for shooting out that instant message to us on yahoo at plmosca143. The Home Affordable Foreclosure Alternatives program, or the HAFA program, is intended to simplify and streamline the process. Do you think that is going to happen?

Yates: We've been doing some education on HAFA so if you want to go to our site, you can check that out. We have a Webinar On Demand. If you want to get a discounted price, reach out to Peter for that link. The Webinar goes through the entire plan. What's good about it so far, first off, is that it's being rolled out methodically. The supplemental directive was put out in November, and so lenders have been gearing up for it. They're starting to put systems in place, which will be very, very important. The folks we are speaking with in the lender world are doing that very thing right now, so we are very encouraged that there will be some great progress made on this. Plus, the support from the GSEs (government sponsored enterprises) -- Fannie and Freddie -- and their role in it. They're doing education on it, too. Freddie's job is to basically review and do the oversight. I'm excited about the opportunities for the agents, agents that may be struggling right now in this economy. It's a way for them to continue to have business and be able to help homeowners get out of a situation that they have so they can move on and get the plate fresh and be moving forward. And, it's good for the buyer as well. The buyer that submits offers for a short sale and has to wait and wait and wait, there's an opportunity now for that buyer to have reason to stay in the game and hopefully get to move faster and know exactly what they've got to offer and where those numbers lay. I think it has a lot of positives to all sides of it. Still, at the end of the day, the proof is in the pudding, so we'll see what happens.

Published: May 6, 2010

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