Life of a Loan: The foreclosure
Between Facebook, Twitter and texting, we can know what our best friend had for breakfast, the last time they went to the gym and even how their pet is feeling without ever picking up a phone to call them.
But in result, this problem dissolves into the rest of our life, and we struggle to ever pick up a phone—especially when it comes to paying bills.
Continuing in our 'Life of a Loan' series, as a borrower, you have two extremely different routes. The first, paying off the loan, is the best route. Congratulations, you did it. The second, however, is not as fortunate, and the loan goes into delinquency.
A loan goes into delinquency once it goes 30 days past due, but up until that point, mortgage firms are working in overdrive to try and keep the loan current.
Bryan DeShasier, chief risk officer with Guardian Mortgage, said one of the most important factors in the process is for the borrower to simply call them back.
"Help me help you. I know that seems very rudimentary and simple, but that’s the biggest problem that we face," DeShasier said. "Borrowers often do not want to talk about their challenges any more than they need to."
Since Guardian carries less then a 1% delinquency rate, they can take a little bit more of a personalized approach as long as we fall within state and federal laws, DeShasier noted.
One key thing to note is that ultimately the mortgage lender does not want the house back. But in order to ensure this, DeShasier explained, "We have to have a good follow-up process and more of a friendlier approach, opposed to one that is very robotic."
Once a loan goes into delinquency, it is easy for them to get lost in the foreclosure pipeline.
Lenders need to see that it is not a borrower and it is not a loan number, but that they are people, DeShasier said.
Whether you are a big mortgage firm or a small one, DeShasier explained that every firm is different and has its own struggles.
"Each borrower is different. You can develop a uniform model to handle the situations, but not every borrower will fit in these specific areas. You have to listen to the borrower, understand who they are and understand their circumstance, including their financial picture to get them into the loan (or a loss mitigation solution) that is a good fit for them.”