When you buy real estate in a normal transaction, you negotiate directly with the owner or the owner’s real estate agent. You rarely come into contact with anyone else, and you certainly do not need to craft any solutions to meet the needs of multiple parties. All of that is different when you buy foreclosures.
You might think you can simply call the lender named in the mortgage or deed of trust and work out a deal. When clerical personnel seem to be giving you the runaround, you might become discouraged and quit. If you understand all the parties involved, you may be better informed than the person on the other end of the phone. You can ask direct and pointed questions to find the person with the required authority to talk to you.
Often, you will be able to talk to only one of the parties, but you still have to consider the needs of the other parties. More than likely, one or more of the parties will have to accept less than everything on their wish list. Knowing the parties and their motivations can help you come up with a workable solution and persuasively argue why your solution is better than the alternatives.
The least sophisticated party in the whole mix will probably be the borrower. Add to that the fact that the borrower is emotionally involved and probably not able to think things through in a fully rational manner. If you are negotiating with borrowers, you will need to educate them on their options and explain why your solution will produce a good outcome for them.
You cannot rely on a borrower to understand the big picture when you offer something. It is a difficult time for him or her, and you must be explicit.