Software Features

BROKERAGE SERVICES

Software Features

Property Data

Research properties and their owners, compile lists, and more.

MLS Comps

A multiple-listing service comparable tool.

Listings

List your properties with Propelio Realty for incredible savings.

Short Sales

If you have an underwater property, our experts can help.

For Education

Blog

Interesting and valuable articles from Propelio and the industry.

Academy

Real Estate education platform led by a team of professionals.

Propelio TV

A channel that gives daily updated archive of our live video.

Discover Propelio

About Us

Get to know Propelio better – explore our story and mission.

Map Coverage and Brokers

Shows MLS coverage and broker transactions in your state.

Referral Program

Share Propelio with friends and family to earn exciting rewards

Template is not defined.
Play Video

Three Steps to Avoiding Servicing Nightmares in Real Estate

Welcome to this week’s lesson! We’re diving into “Three Steps to Avoiding Servicing Nightmares.” Joining me are two industry pros: Paul O’Dwyer and Mike Powell. If you don’t have a mentor or someone better than you in your circle, start working on that now.

Understanding Servicing

Servicing is a critical aspect of real estate. It involves using a third party to manage the collection of payments, escrows, tax documents, and more. The servicer ensures all payments are made correctly and provides annual statements.

Step 1: Recognize the Liabilities

Compliance and Regulations

Managing your own servicing can expose you to significant liabilities. The most crucial factor here is compliance with debt collection laws. Ignorance of these laws can lead to severe penalties.

In Texas, a whopping 95% of complaints to the Savings and Mortgage Loan Commissioner were related to servicing issues. These complaints can come from misunderstanding simple concepts like escrow. Even a minor mistake in servicing can land you in hot water.

Avoid Self-Servicing Pitfalls

You might think self-servicing saves money, but it often leads to more headaches. Until you’ve managed at least 40-50 notes, stick to third-party servicers to avoid making costly mistakes.

Step 2: Value Your Time

The Cost of In-House Servicing

Servicing notes isn’t just about following complex rules; it takes up a lot of time. You’d need a robust software program, and a decent one costs between $700 and $25,000 annually.

Focus on High-Value Tasks

Your time is best spent making deals, not managing spreadsheets. Handing off servicing to a third-party allows you to focus on what you do best: closing deals and bringing in revenue.

Step 3: Choosing the Right Servicer

Finding a Trustworthy Partner

Selecting the right servicer is crucial. Look for companies with strong technology platforms that offer online payments, good customer service, and transparent reporting.

Mutual Respect and Industry Knowledge

Choose servicers who understand the real estate industry. If they also hold notes themselves, that’s a good sign they know what they’re doing. Make sure they understand their role and respect your expertise as the investor.

Reliable Third-Party Servicers

Good servicers should handle everything seamlessly, from collections to escrow analysis, without you needing to step in frequently. A reliable servicer also provides you with solid documentation, which is crucial if you plan to sell notes down the line.

Takeaway

Navigating the complexities of loan servicing is critical to the success and sustainability of your real estate investments. By recognizing the liabilities, valuing your time, and choosing the right third-party servicer, you can avoid common pitfalls and focus on high-value tasks. Remember, leveraging the expertise of seasoned professionals like Paul O’Dwyer and Mike Powell can provide invaluable insights and mentorship. 

Ensuring that you have a reliable servicer can save you from costly mistakes and allow you to concentrate on growing your portfolio. Invest in the right partnerships and make informed decisions to secure a smooth and profitable servicing experience.

Get started with Propelio and unlock all the tools you need to succeed in real estate. Sign up now for a 14-day FREE trial: Start Free Trial

show less

Leave a Reply

Your email address will not be published. Required fields are marked *

Recent Episodes

Play Video
3 minutes

Many have asked how I climbed from wholesaling five years ago to flipping...

Play Video
45 minutes

Welcome to the Real Estate Business Mastery Show! In today’s episode, we recap...

Play Video
62 minutes

Welcome to another insightful episode of the Real Estate Power Hour. Today, we...

Play Video
49 minutes

Good morning, everyone! I’m Robert Kelley, and today I’ve got Kristen Gary Saad...

Play Video
47 minutes

Hey everyone, I’m Ryan from Propelio. Today, we talked with Lolita Shira, also...

Play Video
2 minutes

Do you remember the first time you tried to solve a complex problem?...

Play Video
50 minutes

Understanding the real estate market is crucial for investors looking to thrive and...

Play Video
5 minutes

Hey folks, Blade Johnson here from Finishing Touches in Fort Worth, Texas. Today,...

Play Video
28 minutes

In today’s fast-paced world, staying on top of your health can be a...

Play Video
44 minutes

Hey everyone, good morning! I’m Ryan with Propelio, and today in the studio,...

<span data-metadata=""><span data-buffer="">Propelio TV

Do you love learning from your favorite hosts? Subscribe and we will notify you when we release new shows.