In This Issue:
- Unemployment and Its Effect on the Real Estate Markets
- What to Do When Facing Foreclosure
- Social Networking – A Key to Success
When we opened the doors to Default Research almost 6 years ago, we were able to help many of our clients organize their direct mail marketing campaigns. Default Research offered to help design, print, and even send these personalized post cards. It seems that 6 years later, a new portal is opening with social media.
As the methods to reach homeowners in distress have grown, Default Research has hopped on the information superhighway as well. Late last year, we invited our clients to ride with us as we began to use Twitter on a daily basis, strengthened our page on Facebook, and are always adding new methods to reach our clients. We encourage you to link to us on Facebook and Twitter, as we plan on sending exclusive promotions to our followers in March 2010.
In this month’s article in the newsletter, we encourage our readers to follow our lead. But, don’t just use social media to use social media; the article explains how and why it is important to use the tools offered on the Internet. The newsletter has other helpful tools for you to use, such as what an owner should do when facing foreclosure (hint – DO NOT ignore the warning signs) and how unemployment effects foreclosure rates (hint – it is NOT good).
Hopefully that is enough hints to entice you to continue reading the first issue of The Homestand for the new decade. The information, advice, and hints should open new doors and lead you right to a familiar door; the bank.
Unemployment and Its Effect on the Real Estate Markets
As 2010 gets underway, there are some positive indicators in real estate for the year to come. For example, the recession seems to be ending with the Gross Domestic Product expected to grow by 2.5 to 2.75 percent this year. Inflation continues to remain low hovering around 2.8 percent. Finally, thirty year conventional mortgage rates continue to remain below five percent.
However, the one monster number that still is holding the country back is unemployment. This remains high at approximately 10 percent with some states like California, Florida, Nevada and Arizona seeing unemployment rates near or exceeding 12 percent. It’s no surprise that these states also lead the nation in foreclosures because unemployment is one of the main factors that contributes to a homeowner ending up in foreclosure.
Many expert economists point out that jobs are one of the last pieces of the economy to recover and the mortgage banker association recently released a study predicating that unemployment would peak in the first quarter of 2010. As the subprime mess may be finally starting to clean its self up, we may begin to see more foreclosures due to job loss rather than poor decision making when financing. In addition to high unemployment, there is also a significant amount of underemployment. Some experts say that over 10 percent of America is underemployed.
All of that negative unemployment news being said, as joblessness begins to slowly improve, lending continues to increase, and companies begin expanding and hiring again, the hope is the residential market will begin to recover in 2010.
What to Do When Facing Foreclosure
After almost 6 successful years in the foreclosure business, Default Research can confidently say, when facing foreclosure, “Ignorance is not bliss, and a late notice is not a death-knell.” Instead, it is a time to take guarded, steady, well-informed action toward keeping one of your greatest assets. This is super important advice as a remarkable increase in foreclosures is expected in 2010.
As a property owner, you can expect to be blasted with rumors and sales gimmicks purporting to help the owner out of the quandary. Two words: ignore, ignore. First and foremost the owner must be in communication with your lender! Remember, they do not want to foreclose on your house; their only goal is to have the debt paid. Sad thing is that some 50 percent of borrowers facing foreclosure disregard delinquent notifications; but without dialogue between you and your lender, huge penalty fees may accumulate, making the problem increasingly worse.
That being said, don’t try to rectify the problem with the bank on your own. The property owner should always find a legal representative who is an expert in the real estate industry; there are many programs out there designed to help homeowners in distress. Your particular area may have a program of pro-bono based legal advice and at little or no fee, you can be guided through various ways to rectify your situation. Some of these procedures include loan modification, forbearance, refinancing, short sales, deed-in-lieu of foreclosure, or pre foreclosure sales. Many of the hardest hit areas like Florida, have consumer advocate groups geared toward educating the property owner and trying to dispel the confusion and misinformation they find in the media.
The homeowner in distress must also figure out how they can help themselves. This is a time to tighten the belt, decide how you can change you spending practices so that more of your assets can be funneled into the property. Ask yourself, do you have a second car? Or, do you own life insurance policies that can be cashed in? Maybe you have jewelry or other assets that can be sold to increase your revenue and make your lender happy? Your mortgage payment, next to healthcare, should be your first priority! Another personal need-to-know are the foreclosure laws in your state, clearly pointing out timeframes for specific actions that may be taken by both lender and borrower.
This article is to help you understand your options so as an owner; you can know exactly what your loan documentation is saying about late payment or pre foreclosure actions that can be taken. There is a lot of help out there, but as an owner, you must be willing to help yourself first by recognizing you need help.
Social Networking – A Key to Success
Picture this; when I started Default Research over five years ago, the marketing in this business was totally different. While direct mail is still an effective method of reaching customers, social media is catching up very quickly. At this point, web sites like Facebook and Twitter are proving to be cheaper, more effective and the hip way to go about getting new clients in the real estate business.
The first step in your social media adventure might be just blogging. You can use this as a chance for you to establish and gain credibility, reach new clients, and dip your toe into the world of social media. You are able to blog when you want and write about subjects in the real estate world that peak your interest. If they make sense to you as a blog topic, then the chance are that other people in the industry are also thinking about the same topic too.
As you write topics that people enjoy and wonder about, the more fans you might get on Facebook. These fans will become your lifeline on Facebook and you will be able to communicate with them directly about certain topics. In fact, you could take it so far as to create a group that is interested in real estate issues and more importantly, interested in learning more and more about your own company.
These people can then learn more about your company and you in the process. So, be sure to be yourself! That does not mean write all about yourself and completely promote your company, but let people know what type of business you run. Do you engage your customers? Heck, by just being on Facebook you should be able to show your “fans” that you are on the cutting edge and know how to reach all different types of people.
Therefore, you should always keep in mind that you will be communicating with hundreds, if not thousands, of people. So, anything you can, say or do will be in writing and out there for anybody to read. Every word or thought should be professional and know that your thoughts and sentences will be somewhere in the wide world of the world wide web for everybody to read and think about.
So, take some time and ponder social networking. But, do it for the right reasons (to reach people) and do it the right way (in a professional manner). Then, you will not only be social networking, but doing it the right way too.