When marketing to a list of distressed homeowners, I threw out to some of of our clients a new, innovative spin on the classic marketing approach – Google remarketing. It created enough buzz that I decided to write this post.
Let’s say that you drive a distressed homeowner to your website or landing page to learn about their options to avoid foreclosure. While the goal is to capture their contact information – perhaps to download some kind of free report – the reality is many homeowners will leave your site and never hear from you again. Yet Google remarketing will display your ad to that distressed homeowner when they later visit other sites within the Google network.
Case in point: I recently went to Allstate.com and left without requesting quote. I was a lost opportunity right? Not yet. As I surfed around the web and checked my e-mail, I was greeted with an ad by Allstate ambassador Dennis Haysbert. I was hit several times, in fact, by Allstate ads and so they became more top of mind.
A large percentage of web traffic will go to a website and never raise their hand. This is especially true with distressed homeowners. On the emotional roller coaster of shame, embarrassment and panic, many of these financially impaired homeowners will not make contact immediately and need to be nurtured before they are ready to take action. You cannot make contact with a distressed homeowner that visits your website if you don’t even know they were there.
Google Remarketing changes that by enabling your text and banner ads to follow prospects around the internet once they leave your site. So if leads don’t take the desired action on your website the first time, you stay in touch. No leads left behind. Each visitor to your website is tagged electronically and added to your marketable audience.
Then, as they browse around anywhere on the internet from their gmail account to YouTube to the websites where they read about sports, celebrity gossip and news, each member of your audience is shown your remarketing banner ad, such as “Free Report: 10 things you should never do if you fall behind on your mortgage payment”. That’s smart marketing.
Sold on the idea and want to stay in the forefront of distressed homeowners that visited your stop foreclosure site? Here are the instructions on how to do it and the next steps.
At preforeclosuredata.net, we provide early, accurate and exclusive pre-foreclosure data to real estate professionals and actionable insights to get through to distressed homeowners. Having a footprint in hundreds of successful campaigns to distressed homeowners, we are uniquely positioned to increase your inventory by marketing to homeowners in unaffordable loans. For experience-driven advice, call us at 866-490-3459 or send us an e-mail.
When marketing to distressed homeowners that are falling behind on their mortgage payment, it is not uncommon to get the occasional call from an irate homeowner that feels affronted and vents their ire on real estate agent that offers to help stop the “F Word” – Foreclosure.
If a homeowner on our pre-foreclosure list is being reported as delinquent by their lender, it is oftentimes a tumultuous period in their lives, and they are naturally angry and going through an emotional roller coaster of shame, embarrassment and panic. Many of these homeowners are also in many cases are in denial. It’s no surprise, then, that when a good intentioned agent contacts a financially impaired borrower with the message of hope and solutions, there may sometimes be a backlash against the agent.
I’ve always been a proponent of the “soft sell” approach. Rather than singling out the homeowner, using soft verbiage such as “I’m not sure if this applies to you or not, but if you know someone that is falling behind on their mortgage payment or owes more on their house than what it’s worth, I can walk them through the options….”. In this manner, you are not professing that you have any inside knowledge that the borrower is missing their payments.
From my experience, most complaints from distressed homeowners are triggered by marketing pieces that single them out. If you say, “through my research, I understand you are falling behind on your mortgage”, or “the bank is reporting that you are delinquent on house payments”, you will infuriate a great number of homeowners. This should go without saying, but I have seen some egregious campaigns that say these type of things, so I would be remiss not to mention this pointer.
When confronted by disgruntled recipients of your marketing, a good approach in my view is to present yourself as a compassionate distressed property expert that offers solutions to problems with real estate loans, and that you are canvassing the entire neighborhood, versus singling out any one homeowner. I put together a guided script you can use when interfacing with those homeowners in this blog post.
Interestingly, however, I cam across a fresh approach to dealing with irate calls from financially impaired homeowners, in a video blog by Alex Charfen, CEO of the Charfen Institute and author of the CDPE program. He discusses a three-pronged approach to not only deal with these irate calls, but to convert them. You can watch the video here.
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Make people laugh in unison. Make them FEEL emotions. Make them explore their beliefs and resolve moral quandaries. And a good script will do that. Night after night, show after show and in Shakespeare’s case, century after century.
In theater, all actors are scripted in order to build emotion of the audience. A script is like a business PROCESS. It reliably produces predictable results.
As a REALTOR or investor, you want the same predictable result. You want to hit the right buttons and create the same emotional effect of getting distressed homeowners to like you, trust you, and view you as a friend that has their best interest in mind. Since you want that predictable result, why do it on the fly?
Words matter, and if you sell real estate, you have to do a lot of talking to convince buyers and sellers. It makes sense to have a script prepared, not necessarily a canned scrip verbatim but at least a guided script that provides a framework to the communication.
To bounce some ideas around on what verbiage works when interfacing with distressed homeowners, get in touch.
On Friday, I spoke with a client in Michigan that accesses our pre-foreclosure data and he reported that while the phone is ringing, a lot of homeowners are inquiring about a loan modification, to his initial disappointment. My response? If homeowners are making contact exploring a loan mod, it is a great lead. Sure, you want them to list their home, but if they are reaching out to you, this is a lead that can be put in an incubation process. The main thing is, if a homeowner is making a connection with you – the real estate professional – it begins a process and a conversation, and you can build trust and rapport with those struggling mortgagors, the building block of a deal.
9 times out of 10 the loan modification is disapproved. Then what? You can shift the conversation to a short sale.
Who will the homeowner list their home with once a modification is not viable – a Johnny come lately, or the agent that was there from day one, through thick and thin, the one that was there holding their hand walking the homeowner through all of their options, including but not limited to a short sale? Chances are, they will list the home with the agent that provided counsel through the get go.
Trust is the name of the game. Presenting yourself as a compassionate real estate professional that offers ethical, practical and a variety of solutions to problematic loans will yield enormous dividends.
Presenting yourself as a stereotypical REALTOR looking to list a home and in essence, profit from the homeowner’s hardship, will not. It’s a simple concept, but one that is ignored in 90+% of pre-foreclosure marketing out there.
If you want to bounce some ideas around on how to stand out from the crowd, get in touch.
Although it’s a good practice to provide free resources for distressed homeowners to become educated on their options, in our view, caution should be taken to avoid giving those troubled homeowners TOO MUCH information. You are the real estate expert, not them, and if you provide too much information, you run the risk that the homeowner closes themselves. Distressed homeowners should be spoon fed, not given a full course meal of every single detail.
This was brought into focus recently speaking to an agent that was putting a marketing system in place before using our 30-60-90 day late data. As one component of his system, there was a comprehensive eBook that distressed homeowners could access on his website. The eBook was massive, chalk full of information walking them through every option of foreclosure. It was great information, but it was information overload, in our opinion. Was it a valuable resource? Yes. Did it provide urgency to contact the agent? I don’t think so, because the eBook in essence replaced his role as a real estate expert. Once the homeowner knows every single detail of staving foreclosure, there is little incentive to consult with a real estate professional since the information is all laid out in a single document.
A better practice, in our view, is to provide more bite-sized information, with a clear call to action. For example, offering a free report: “3 steps you need to take now”. What are the three steps:
1) Contact your lender. Call to action: Contact the agent to advise on what to say to the lender and/or prepare a hardship letter, and/or download a sample hardship letter, etc.
2) Hire a qualified real estate professional. Call to action: Get a checklist of what to look for and what to be careful of when hiring a real estate professional.
3) Organize your information and documents: Contact me or download this checklist of documents you need, etc.
The quintessential point to get from 40,000 feet is to guide the homeowner along with small, specific steps, until the lead comes to fruition.
As you are probably aware, the FHFA very recently rolled out new guidelines that will make the processing of Fannie Mae and Freddie Mac short sales less drawn out and contentious. These new changes will allow both lenders and servicers to more quickly and efficiently qualify borrowers for a short sale.
These changes will take place on the eve of the election, on November 1. The specifics of these revamped guidelines (courtesy of C.A.R. Newsline):
- Eliminates current Fannie Mae and Freddie Mac short sale programs and creates a single standard short sale process for both entities (Fannie and Freddie HAFA programs will expire at the end of the year).
- Enables servicers to quickly and easily qualify certain borrowers who are current on their mortgages for short sales without waiting for an approval from Fannie Mae or Freddie Mac
- Offers special treatment for military personnel with Permanent Change of Station (PCS) orders.
- Standardizes and clarifies foreclosure suspensions on a property with an approved short sale.
- May pay borrowers up to $3,000 in relocation assistance.
- Fannie Mae and Freddie Mac will offer up to $6,000 to subordinate lien holders to expedite a short sale.
Additionally, FHFA clarified that a borrower experiencing a hardship must wait at least two years before becoming eligible for a Fannie Mae or Freddie Mac loan.
This welcome news is in addition to the FHFA’s June 2012 announcement that mortgage services must review and respond to requests for short sales within 30 days, setting “minimum standards and providing clear expectations regarding these important foreclosure alternatives”, according to FHFA Acting Director Edward J. DeMarco.
While the jury is still out and you may have formed your own opinion on the effectiveness of these initiatives in practical terms, there’s no doubt that 2012 is proving tailwinds for short sale experts.
Here at preforeclosuredata.net, we are excited to provide short sale agents even more precise data and allow agents to capitalize on the new guidelines, by selecting distressed homeowners with Fannie and Freddie as investors in the loan. By isolating Fannie and Freddie loans, you have an “in” by contacting these homeowners and informing them they have been “pre qualified” for the laxed guidelines of a short sale.
To get a count of distressed homeowners need your help, call us at 866-490-3459 or request a free area analysis.
In this post, I’ll take on the topic of using telemarketing as a channel to reach out to homeowners 30, 60, or 90+ days late on their mortgage payment.
Many marketers prefer to make contact with distressed homeowners over the phone, but in my view, that’s analogous to calling up a stranger and asking them if they have a drinking problem. Would they admit to a total stranger that they have an addiction?
I believe that the phone can be a good follow-up device once a distressed homeowner knows you, or at least knows of you. If you’ve made initial contact with distressed homeowners through other channels, you have more of a licence to call them. Of course, it is not “cold calling” if the homeowner volunteers their phone number through a web-based form you can drive them to in order to download a free report, video, or other snippet of information – more on that later.
First off, when identifying homeowners in pre-foreclosure, phone numbers are in short supply because of two dynamics:
- Land lines are becoming obsolete, as more and more homeowners – and particularly younger homeowners – are using mobile devices.
- A staggering amount of homeowners that do have a land line are registered with on the Do Not Call List.
We can only obtain phone numbers from the credit reporting agencies that are compliant with the DNC regulations. They are real legal sticklers when it comes to that. Now, certainly no responsible marketing company would advocate looking up the homeowner without regard to the do not call regulations and we stop short of that. It is, however, noteworthy that most agents and others in the distressed property industry don’t seem to care about the DNC. Their sentiment is, “I’m not really selling anything”, and in fact, they are reaching out to help. It’s not as if they are selling steak knives or peddling a magazine subscription – it’s almost as if they are conducting social work. Says one subscriber of our pre-foreclosure data: “I’m not bothered by the do not call list, because if it wasn’t for me, these families would have their belongings on the curb”.
The appeal of calling distressed homeowners is obvious. There is little cost to getting the conversation rolling on the phone – the biggest cost is the time associated with making the calls. Moreover, there is an immediate response if you can get these homeowners on the phone, right? In my view, there is a fallacy in this thinking.
- For one, financially distressed borrowers are getting deluged with collection calls and so many of these homeowners simply are not coming to the phone or they change numbers.
- Second, many homeowners that are not paying their mortgage are not paying other bills, including their phone bill, and so the phone company disconnects their number.
- Finally, working with distressed homeowners is a process and requires a concerted, multi-pronged approach through multiple channels. It is not going to be a one-call close. While there is a perceived sense of instant gratification in using telemarketing, this is not the case from my experience.
Direct mail needs to be part of any successful short sale acquisition program. Direct mail leads convert a higher rate than telemarketing due to the self-selected nature of the responder. Direct mail leads have consciously made the choice to respond. Unlike a telemarketing lead where the choice to respond may be a concession, the choice to respond to direct mail is based on a genuine interest from the homeowner that wants to explore what their alternatives to foreclosure are.
During an age where marketers are zipping tweets and pulling in fans for Facebook, direct mail can seem decidedly old school. Yet direct mail should not be dismissed as too pricey or passe, and can be combined with online marketing to create synergy. Direct mail and online marketing are not mutually exclusive, but compliment one another.
For instance, you can use direct mail to drive a distressed homeowner to a landing page, where they can get access to a free report such as “10 things you should never do if you fall behind on your mortgage payment”. In order to obtain the snippet of information you are offering, they must fill out a form, including their phone number. Caution is an order, however, in asking the homeowner to fill out too much information. Pry too much and you guarantee that the homeowner will be scared away. A phone number and e-mail address should suffice.
It should go without saying (but it’s said because some agents do this) that if you elect to call distressed homeowners, you should never profess that you have any inside knowledge that they are falling behind on their mortgage payments. This will only alienate them at best, or at worst, lead to a mouthful of expletives.
This blog post is becoming monsterous, so I’ll wrap it up for now and continue this in other posts. I’ve only scratched the surface here, so stay dialed in at facebook.com/ShortSaleLeads, on Twitter @shortsaledata, or better yet, give me a call at 866-490-3459 to bounce some ideas around.
Till next time, A-B-C… Always Be Closing.
Paying for “leads” is ineffective in our view, and not a judicious use of your time or money. That may be a stark statement coming from a leads provider, right? Why would a leads provider tell agents not to pay for leads? The answer is we do not provide leads. We provide data, and there is a huge difference. You can pay a lot of money to a leads provider and leave the results to chance. Or you can shape your own destiny, at a much lower cost by generating your own leads using early and accurate pre-foreclosure data.
Diamonds and cubic zirconium may look the same, but there’s a vast difference in worth between the real gem and its fake twin. Agents face the same dilemma in their campaigns when determining whether they are purchasing data or leads. The difference between data and leads isn’t as clear cut as it may seem, just like that sparkly diamond may be worth less than a lollipop ring.
A good example is our prescreen credit data. The credit bureaus really don’t sell “leads”. That has wrong written all over it. Yet our tri-bureau platform can identify homeowners being reported by their lender as 30, 60, 90 or 120+ days delinquent on their mortgage, before the NOD or Lis Pendens is filed. Unlike a “lead”, distressed homeowners in our database didn’t directly contact your company for help. What we provide is raw data – the building blocks of a marketing campaign that can educate distressed homeowners on their alternatives to foreclosure and get them to work with you. Our data identifies the best prospects for a short sale, which you can convert into a qualified lead. In other words, our data equips you to cost-effectively generate your own leads without relying on outside sources.
In contrast, a leads company provides live or so called “warm leads” and does what you as a real estate professional should do on your own. In turn, they charge an exorbitant cost per lead. Hiring a traditional leads provider can be a very costly endeavor. Costs vary depending on the actual campaign that is being conducted, including SEO, PPC, direct mail, email and telemarketing campaigns, but you can easily pay $10 or more for a so-called warm prospect generated by a lead generation company. These companies factor in their hard costs and a margin of profit to price their lead generation programs.
While leads can be cost prohibitive, data is much more affordable. Rather than paying upwards to $10 per lead, you can obtain highly qualified data much more affordably. In addition to lower cost, prescreen credit data allows you to be more selective in who you target, thereby building a list of the most qualified and lucrative group of homeowners.
You can pay good money for a “lead” of a homeowner who’s house is going to auction next week. Or a homeowner who’s house is worth $40,000 and not worth the time and aggravation of a short sale. Perhaps the homeowner has four mortgages, requiring you to negotiate with four different banks, or maybe they have been pulling equity out of their home, rendering it nearly impossible for the lender to agree to a short sale. It’s possible that the homeowner owns a condo, and you don’t want to deal with the HOA. There are several other scenarios you can probably think of that you want to avoid. By using prescreen credit data, you can build a highly targeted list based on the number of days delinquent, loan balance range, number of mortgage trades, dwelling type, and other precise attributes to lower your marketing cost and increase your return on investment through more completed transactions.
By paddling your own canoe and using data to generate your own leads, you are the decider of what “lead” is qualified. You are the real estate expert, not a sales rep in a call center of a leads generation company. You can waste a lot of time and money on a lead that has a zero chance of leading to a completed short sale transaction.
In parting thoughts, I’ll use the analogy of the Home Depot, who’s motto is, “You can do it. We can help.” We give you the tools to build the house, or more appropriately, list the house.
Who’s your niche audience? Enter your criteria here and we will provide a free area analysis of how many distressed homeowners need the help of a short sale expert.
In the last post, I introduced door knocking as one way to get your message of hope and solutions out to distressed homeowners falling behind on their mortgage payments. Rather than attempting to close the deal on the porch, the soft sell approach of sharing more information has paid dividends to agents pounding the pavement for more short sale listings. Using a list of homeowners 30, 60 or 90+ days late on their mortgage, you can know exactly which mortgagors are struggling, but we strongly advise against telling the homeowner that you have any knowledge about their hardship. We’ve worked with agents that have said to the effect, “through my research, I understand you are falling behind on your mortgage, and I can help….” or, “the bank is reporting that you are 60 days late on your house payment…”. Predictably, this has infuriated homeowners.
A better approach is to present yourself as a local real estate/foreclosure prevention expert that is canvassing the neighborhood to share free resources in the event that the homeowner knows anyone that is facing hardship in this turbulent market. In this way, you are not singling out the homeowner, but convey that you are hitting anyone and everyone in the area with this information. Here is some sample verbiage you can use when knocking on the doors of distressed homeowners:
KNOCK KNOCK. “Hi, Mr. Smith… my name is Bob, I’m a local real estate/short sale expert, I provide ethical, compassionate solutions to problems with real estate loans and I’m visiting the neighbors this evening… I hope I’m not interrupting dinner, I just want to get a couple of these in your hands and get out of your hair…. (hand them a card, flyer or other collateral with a link to your free resource).
This is a book I put together and I’m not sure if this applies to you or not, Mr, Smith, but I’m sure you know someone here in Maricopa County that is having a hard time making their mortgage payment or owes more on their house than what it’s worth, and if you give this to them, they’ll thank you, I know they will. It’s not about me, I wish they would call me, but they’ll thank you for this.
This book will show them how to avoid foreclosure, it’s got all the tools they need, resources to pull it off. Maybe they want to sell their house for free – short sale – deed in lieu of foreclosure, maybe they just want the bank toforeclose, maybe they’ve been trying to modify that loan for six months now and it’s just not going anywhere. This book will talk about that, too, and what to expect. So can I leave you with a couple of these and you can download it and get a free copy and you can send it to whoever you might know, maybe a coworker, someone at the gym, family member, friend, that is upside down on their primary residence – orinvestment property – it doesn’t really matter, this book will help them out, it will show them the way out, well, out of the woods. I appreciate your time, have a fantastic evening”.
The biggest sentance to get is “I’m not sure if this applies to you or not, but I’m sure you know someone”. This non-threatening verbiage disarms the homeowner and presents yourself as a compassionate, concerned and guileless person who’s objective is to help.
To learn how many struggling homeowners need your help, you can request a free count at http://www.preforeclosuredata.net/distressed-homeowner-count.html
When using a list of homeowners in pre foreclosure, there are many agents that prefer to deliver their message of hope and solutions in person by knocking on the doors of distressed homeowners.
Door knocking has some powerful advantages over other forms of marketing. Think about it – what other form of advertising can pull a football fanatic out of his recliner, during an exciting football game, to see or hear your advertisement?
In order for a distressed homeowner to agree to work with you, they have to like you and trust you, and view you as someone that has their best interest in mind. Remember, for the past two years, the media has been ingraining into their minds that if someone approaches a home owner with foreclosure help, it’s probably a vulture looking to swoop in and profit from the homeowner’s misery. When done right, the face to face, personal element of door knocking goes a long way to overcoming this distrust. Your goal is to establish empathy, trust and rapport and in my view, the best way to do this is face-to-face.
First impressions are everything. Many novice agents and investors have lost deals because they blurted the first thing that came to mind and it wasn’t taken well by the homeowner. Rather than “winging it”, I recommend having a script prepared. The goal is to make an emotional connection with the homeowner, it’s to create a predictable result. It’s like theater. All actors are scripted because they are trying to build emotional excitement with the audience. A carefully designed script can create the same predictable reaction.
The verbiage that seems to work is “if you or someone you know is falling behind on their mortgage payment or owes more on their house than what it’s worth, I can help….” The operative term is IF. Armed with an early, accurate and exclusive pre foreclosure list, you can know exactly which homeowners are late on their mortgage payment, but I recommend not professing you have any inside knowledge that they are falling behind.
If you tell the homeowner that through your research, they are delinquent on their mortgage payment, the homeowner will more times than not, become defensive. Implying in any way that the homeowner is responsible for their situation is the quickest way to get thrown off the porch.
In future posts, we’ll share some door knocking scripts and provide some tips on making your campaign more effective. Until then, happy selling!