By Deborah Ball, RE/MAX Times Online Associate Editor

When it comes to short sales and foreclosures, there's no lack of work for real estate agents.

But navigating these bumpy transactions isn't a specialty for the faint of heart - and it's not always about the money, according to Brett Varner and Cindy Keil. They are the backbone of a group marketed as the Foreclosure Relief Team of Northwest Ohio, and they've helped 200 families avoid foreclosure.

How the Foreclosure Relief Team works
At the helm of the team are Varner and Keil, Associates with RE/MAX Masters in Toledo, Ohio, who are the agents on the frontline. Varner's wife, Diane, does the back-office work. An attorney, a certified personal accountant and a lender round out the group.

The team also uses a certified, knowledgeable title company that understands short sales, Keil says. Varner adds that it's important to familiarize yourself with the loss mitigation officers at local banks, and to develop positive working relationships with them. They hold the cards in most short-sale and pre-foreclosure situations.

Varner and Keil call it their personal crusade. After all, it's no small feat to repair the damage foreclosures have caused in their housing market - and to peoples' lives.

"Here in Ohio, you can drive around pretty much any neighborhood and pick out the foreclosed homes," Varner says. "The grass is overgrown, the shingles are dangling. There are 1.9 million mortgages in Ohio; 22 percent of homeowners owe more on their mortgages than the homes are worth - that's 418,000 houses. This is a huge problem, and it's not going away anytime soon.

"Foreclosures deflate home values - and the values of entire neighborhoods and communities. For every family or homeowner we can save from foreclosure, we're helping our community and neighborhoods maintain home values."

Keil agrees.

"We wanted to do it right and help the most people in the shortest amount of time," she says. "After all, time isn't on your side in these situations. That's why we created this team: to keep people in their homes and help them avoid foreclosure."

"With their help, I was finally able to move on ..."
Michelle Gilford is one of the team's greatest success stories.

She was going through a bitter divorce that forced her to sell her home. What made it even more painful was that Gilford loved her house and didn't want to leave, but she couldn't afford the mortgage on her own.

Desperate and on the brink of bankruptcy, she saw an attorney who referred her to Keil.

"Cindy explained that I could do a short sale," says Gilford, who serves in the U.S. Army Reserves. "She worked with the lender, took care of all the paperwork and made it really easy for me. She was so caring.

"Before she came along, I was crying and frustrated about everything. But she helped me out of a bad situation, and she was on top of it the whole time. She sold my house, and I was finally able to move on. I couldn't have done it without her."

Other clients include families devastated by job loss, health issues and personal heartache. One client, John Kwiatkowski, shared his story with WTOL-TV in Toledo. He was saddled with the expense of an Ohio mortgage and a Texas rental after moving south for a job transfer, and his family was living paycheck-to-paycheck.

The team helped him negotiate a short sale with his bank, which assumed $23,000 in losses on his mortgage. The team's relief efforts also were featured in a video clip on Toledo's WTVG-TV.

Ready to start your own team? Here's how ...
Varner and Keil have tips for agents who are thinking about forming a Foreclosure Relief Team:

• Education is paramount. Learn about the distressed-home market. We learned the ropes thanks to courses from Alex Charfen, co-founder of the Distressed Property Institute that developed the Certified Distressed Property Expert certification. When you handle these transactions, especially short sales, there's a lot of complicated paperwork and steps you need to take to broker it successfully, as well as negotiate back and forth with banks. You need to know what you're doing to have credibility with clients and lenders alike.

• Do your homework first. Have a preliminary HUD background done on properties to check for liens or encumbrances. If there are, you'll need to develop a plan of action to get them cleared of the title. Check all the required paperwork from the lender and title company, and have the homeowners fill everything out thoroughly and accurately so there are no surprises down the road.

• Explain the options. Foreclosure doesn't have to be the final answer. There are several things homeowners in danger of foreclosure can do: a short sale (lender agrees to accepting less than the total amount due on a borrower's mortgage); loan modification (readjust the terms of a mortgage), a forbearance agreement (forebear payments for 90 days, which puts payments and late fees on the back end of the loan); deed in lieu (a disposition option in which a mortgagor voluntarily deeds collateral property in exchange for a release from all obligations under the mortgage); or - a last resort - bankruptcy.

• Have a stringent business plan in place. We started an LLC and set up a separate bank account to differentiate these transactions from our traditional sales (which we still do). Keep track of your accounting, what you're spending and what's coming in. We consult with clients for free, so we have to keep a close eye on finances. This isn't something you can jump into and do effectively if you don't have a business model in place.

• Promote your services everywhere. Go to other professionals and spread the word. Send out press releases and visit churches, homeowner associations and community meetings. We were featured in a few local news stories. Let people know you're out there and ready to help, and eventually it'll spread by word-of-mouth.

• Avoid homeowners who are inflexible. The CDPE designation helped us figure out which clients we could work with - and which ones we simply couldn't help. If you encounter clients who are going to push back on everything, don't work with them. We need people who want to get out of their situations; those are the folks you want to work with because they will cooperate. Communicating with your clients is essential throughout the whole process. They'll appreciate that you're including them in the process when they otherwise feel lost and powerless. Most people bounce back after a short sale and will eventually buy again. They just need your help getting over this first hurdle.

• Be compassionate and it will pay off. Every one we keep in their homes refers us to other people. But you can't go into this for the money. There are some transactions we know we won't get paid for, but there's still a certain amount of satisfaction that comes from helping a family, offering them direction and hope. It does come back to you. If you're struggling right now, you'll find it difficult to do what we're doing. We're diversified in our business, but we have the wherewithal to make it happen. Down the line, it pays its dividends. But you absolutely must have compassion to do this and not think of it strictly in terms of dollar signs.

Comment on this story
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Comments (3)
This is an example of our team philosophy also. While we struggle with balancing and managing our "regular" work vs. short sale and REO clients, and all of the paperwork and communication involved, we want to help others. This team obviously has a great system in place and is an outstanding model to look up to. Thanks for the info.
- Rachel Huls, RE/MAX Today's Realty, Hutchinson, Minn.

Good article, but I'm having a problem in dealing with the out-of-town lenders or mortgage servicing companies. Most are non-responsive or take too long to process the short sale, because they have so many requests. If anyone has dealt with or has a contact name for Aurora Loan Services, I would appreciate having that information. We have been waiting two months for a response on a short sale contract.
- Dennis Blay, RE/MAX Central Realty, Altamonte Springs, Fla.

Excellent article. I also included on my blog page (http://www.traviscwaller.wordpress.com) an article that was published in Money Magazine's February 2009 issue. Great stuff that all Realtors who are serious about their craft need to educate themselves on.
- Travis C. Waller, RE/MAX Advantage Plus, Teaneck, N.J.

Posted 1/19/09