By Kelly Molinari
I often read articles about homeowners in foreclosure and I’m shocked by the way they’re portrayed. Typically, these homeowners are seen as over-reaching and irresponsible — and they’re ostensibly getting what they deserve. Naturally, sympathy is in short supply; but it shouldn’t be.
Certainly, there are those who over-reached or were otherwise irresponsible, particularly in the early phases of the housing crisis. However, most of the homes owned by these irresponsible homeowners have already been claimed by the cold, ubiquitous foreclosure process. In this last phase of the housing crisis, most homeowners facing foreclosure are simply caught in the fallout of an economic recession and attendant high unemployment. I’ll resist the urge to discuss structural and frictional unemployment and other mind-numbing principles of Economics 101. Instead, I’ll just say that most current homeowners facing foreclosure are not to blame. So, as real estate professionals, let’s open up our leathered hearts, show some compassion and help them with sensitivity, lest we lose our humanity.
Foreclosure does not discriminate. There’s no age, nationality, creed, color or religion that is not well represented in the courthouses. They’re people from all walks of life, including those who work with their hands and those who carry gold pens. They’re working class and they’re professionals. They’re your neighbors and mine. In fact, I have completed 30 to 40 short sales on behalf of individuals in our own real estate profession. We’ve been hit as hard as anyone. In most cases, homeowners facing foreclosure are just typical people who wanted to build a respectable life for themselves and their families with homeownership, but were unlucky. Now they need your help in every sense of the word, and you can give it to them. But with great power comes great responsibility.
First, lend an ear and a shoulder. Since Realtors are often the first professional point of contact with homeowners facing foreclosure, they’re on the frontline. This means you’ll see homeowners — people — at their weakest. Their shame and the indignity of it all is sometimes palpable. As a result, you’ll often have to wear two hats, serving as their Realtor and their counselor. Don’t shirk the latter, because in this business, both responsibilities are inextricably wound together. Instead, embrace it. Ask your clients what happened, and really listen to them! Listen to their stories of woe the way they tell them. You’ll find that once disarmed by compassion, they’re eager to talk. It is not unusual for me to sit at a client’s kitchen table and cry with them. For their benefit and mine, I try to put myself in their shoes and think like they’re thinking. It is a humbling experience to witness homeowners realizing they can no longer afford their American Dream. They are faced with the cruel reality that their down payment, installment payments and improvements were all for naught. It takes tremendous courage to come to terms with this cruel reality and face unavoidable embarrassment and then to take action.
Next, show them you care by giving them, or getting them, the expert help they need. Immediately direct your clients to an experienced attorney. In Illinois, attorneys, and only attorneys, should analyze your client’s options. Of course, this may be a short sale, loan modification, deed in lieu or some other workout. Sometimes a bankruptcy analysis is appropriate, but bankruptcy generally does not preclude a short sale. As most of you know, ours is an industry beset by misconceptions, and that’s one of them. I tell every client I work with that I want them to pursue their best option, whether that option includes me or not. In the end, your clients will see you are not just soliciting listings, but that you truly care about them.
Foreclosure is always closer than you think. So treat those facing foreclosure as you would want to be treated. You’ll find if you’re compassionate, confident and knowledgeable, and if you refer your clients to good professionals, it will pay off with warm, fuzzy feelings and referrals! Do it because it’s the right thing to do, but kindness and competence pays dividends too.