E
PL
M
Your Field Inspection
Business
SA
A how-to of
Field Inspections for Mortgage, Lender and Insurance
Field Servicing
Written by
Chuck Smith
Copyright All rights reserved including the right to translate. This material is
protected under United States Copyright Laws.
E
Reproduction, distribution or re-sale of this material is strictly forbidden unless a
written agreement dated, stipulated, and signed by Business Ventures
Consulting, Inc. is provided. No such permission is here implied or indicated.
Licensing, Reprint and Resale rights provided to Field Services Business
Consultant, December 2012.
PL
Authorized Buyer:
SA
M
You are hereby permitted to print one copy of this e-book file and save one copy
of this e-book file to your computer. Printing or saving more than one copy of this
e-book file is in violation of Copyright and shall be punishable under US
Copyright Laws. Buyer is not permitted to print more than one copy, re-sell,
distribute, place files on more than one computer, alter the contents or transfer
ownership rights to this purchased single user material.
2
Table of Contents
Walk-Thru Inspections - Knowledge
needed for Interior Inspections and
Inspecting Vacant Properties
Securing
Charlie / Jimmy Bars and Bracing
Winterization
Wet Heat Systems
Sump Pumps
Debris
Interior versus Exterior
Health Hazards
General Debris
Personal Property
Lawn Care
Shrubs
Conveyance Condition
Completing the Interior Walk-through
Inspection
Security
Utilities
Damages
Winterization
Debris and Personal Property
Insurance Loss Draft Inspections
Construction Draw Inspections
Construction Terminology
Retail Outlet Verifications
In Store Interview and Product
Verification
Drive-by Retail Verification Inspections
Merchant Site Inspections
Site Verifications
Commercial Property Inspections
Commercial Property Insurance Loss
Drafts
Mortgage Property Valuation Reports
Insurance Property Cost Replacement
Valuations
Insurance Property Observation Reports
Car Loan Inspections
The vehicle Inspection
Keeping Salad from Turning to Soup
Places on the Internet to Learn More
Where to Look for Clients
Reference Sources
M
SA
72 – 74
74 – 76
76 – 83
77 - 80
80 - 82
82
83
83
83
83
84 – 127
84
84 – 85
85 - 96
85 – 87
88 – 89
89 – 91
92
93
93 – 95
93 – 94
94
94 – 95
95
95 – 96
96
96
96 – 100
E
2
3
4 -5
6–9
10 – 23
24
25
25 – 26
27
28
28 – 29
29 – 30
31 – 34
34 – 66
35 – 40
41 – 63
41 – 46
46 – 50
51 – 54
54 – 58
58 – 61
61 – 63
64 – 65
65 – 66
67 – 72
67 – 68
68 – 69
69 – 72
72
PL
Copyright
Table of Contents
Disclaimer
Preface
Terminology
Common Abbreviations
Common Sense
Know what the customer wants
Personal Appearance
Personal Safety
Bad Words
Worse Words
About Finding Property Addresses
Property Inspections
Property Condition
Structural Design
Property Types
Construction
The Impostors
Number of Stories
Roof Cover
Roof Styles
Garages
Neighborhood Condition
Borrower Interviews
Direct Borrower Interview
Tenant Interview
Conducting the “Interview Conversation”
A word on hostile occupants, tenants,
borrowers.
Foreclosure Inspections
Bankruptcy Inspections
Conducting the “Drive-By” Inspection
Occupied or Vacant
Pitfalls to Avoid
Trick number 1 the “fabrication”
Trick number 2 the “drive-in”
Trick number 3 the “neighboring drive-in”
Trick number 4 the “drive-around”
Trick number 5 the “direct approach”
Other Inspections
Sale Date Inspections
Rush Inspections
3
98
98
99
99 - 100
100
100 – 104
104 - 106
107 - 108
108 – 109
109 - 111
111
112
113– 114
115 - 117
118
118 - 121
121 - 124
124
124 - 127
126 - 127
128 - 129
130
130 - 131
131 - 132
E
Field Representatives deal with numerous people day in and day out. It is
not a job for anyone shy, insecure or hesitant in any manner. Being
friendly and outgoing will help you deal not only with your customers, who
can and will be demanding, but also the thousands of people you will meet
during the course of business. A sunny disposition is not necessary, but
can help immensely when interviewing a cantankerous or hostile
mortgagor, a hesitant storeowner, a gruff construction site manager.
PL
If you use paper forms in the field, a clipboard gives a more professional
appearance than appearing at your destination with papers only. The
clipboard also gives a handy writing surface. If you are in doubt what your
personality and clipboard can do for you, go out without them for just one
day.
M
The laptop computer, PDA, and/or Tablet PC, are becoming more widely
used with the technologically changing field service requests. These
devices have become more affordable over the past two or three years as
well. Many field service companies are finding that the purchase of a
laptop computer rather than the traditional desk PC is the way to have
your office on the road and immediate access to client via satellite. If you
are serving a large geographical area, you might consider this investment.
A mobile office allows you to transmit data right from a property and
receive requests during daily or extended travels.
SA
The last absolute must have is a good digital camera. Clients do not
always request photographic documentation but it is a guaranteed
request. Furthermore, it is in your best interest to always, requested or
not, digitally document every property you inspect. Most of your clients will
want imagery either emailed or uploaded directly to their website. With
increased issues regarding what services were provided and when, digital
cameras are a must for the volume of photographs you will be taking.
Select your digital camera based on your own preferences. Most stores
will allow you to play with a camera in the store prior to purchase. Digital
cameras are expensive! Play with them to see what is comfortable to you.
A second issue to consider in selection is functionality. Cameras that
8
Terminology
E
Every job has terms that require familiarity. While not all clients will use all
terms, this list is a compilation of over 15 years in the business and
hundreds of different clients.
SA
M
PL
3 attempt – Make 3 attempts to make direct contact. You would visit the
property three different times, at different times of the day and on different
days, making note of the date and time of each visit.
Accessible (opening) – one that will allow entrance without the use of
ladders or climbing
Adjacent to – directly next to. As in, what is adjacent to the subject
property?
Appraisal – a calculation made by a licensed appraiser as to the precise
value of a property and the land it is on.
Asset – any real or tangible property owned. Could be a house, a car, a
boat. It could also be stocks, bonds, and savings accounts
Bad address – an address that does not exist as given
Bank-owned – the bank is the present legal owner of the property
Bankruptcy – the borrower is seeking legal relief from their debt usually
either though Chapter 7 (complete wipe-out) or Chapter 13 (restructure
and repayment)
Before & after photos – taking photos before work is started and after
work is completed to prove what work has been done
Bid(s) – providing estimates to complete certain tasks such as removing
debris, mowing lawns, or making needed repairs. The lender will review
bids submitted by two or more preservation providers and, generally,
award the job to the lowest bidder
Boarded – the windows and/or doors have been covered over with
plywood
Borrower contact – speak directly to the borrower
Broker Priced Opinion - A trained and licensed real estate broker’s
knowledgeable estimation of selling value based on recent sales of similar
properties in the same area.
10
PL
E
cover all the basics and some of the finer aspects of any
inspection request you may receive. However, each customer
and each request is different. The form may look the same as
the last 100 requests but one word or one line may be different.
Likewise, there are hundreds of ways to ask for the exact same
information. Each client will ask in a different way – be sure you
know they want salad even if it looks like they are ordering
soup!
M
If you do not read each request, you may overlook the key to
acceptability and end up serving soup instead of salad. If that
occurs, not only is your customer unhappy with the results but,
and this can be almost 100% guaranteed, you will not be paid!
Now, you have visited a property and may have spent an hour
or more of your time preparing a report that is completely
useless to the client. While the soup may be wonderful – the
customer that ordered salad should not and, invariably, will not
pay for the soup!
Reading each inspection will save you time and trouble and
assist you in keeping customers happy.
SA
Sometimes the small print is the most important!
26
E
PL
Property Inspections
M
The main focus of FIELD SERVICE FOR THE MORTGAGE INDUSTRY is
the PROPERTY INSPECTION. For a multitude of reasons, lenders and
investors need to know the current condition of a property. They may be
updating their files, preparing to issue a loan, concerned because the
mortgagor is delinquent with payments, or seeking information to
determine if intervention is warranted to save the loan.
SA
Regardless of the reason, AN INSPECTION MUST BE ACCURATE. Your
job is to verify the condition as well as determine if the property is
occupied or vacant. Only an unwise person would not take careful note of
condition and occupancy status. Your customer is paying you to provide
this pivotal information and failure to do so will most likely result in lost
work opportunities.
Never tell a customer that you cannot determine occupancy. If you cannot
determine occupancy because of a bankruptcy situation - do your best
and request advice from your customer. Some national service companies
will accept a “cannot determine occupancy” in bankruptcy situations only.
Other customers want an absolute vacant or occupied and will request
that you check with neighbors, the utility companies or the post office.
Check with your customers to determine their particular needs and desires
with respect to the bankruptcy inspection.
34
M
PL
E
Likewise, if there is obvious fire, storm, ice, vandalism or other damage,
you will annotate this on the inspection form, check any boxes or circle
any words that are on your inspection request and photograph the
damage. Write or annotate details in the comments section which is
usually provided. An example would be to check a box for fire damage
and then write in the comments “Vinyl siding is melted near north side by
patio entrance”. Check with your client on photograph requirements for
damages. Regardless of your clients' requirements, take photos! Often
your client will want the photos after you have already submitted the
inspection. If you take several photos while you are there the first time,
you will not need to return.
SA
While at first glance, the property
may appear in good condition,
closer attention to details reveals
the neglectful damages that would
categorize the property as fair
condition.
37
Above: water drip from the airconditioner that was once in place
has caused deterioration of the
wood siding.
Borrower Interviews
Ask for the person who is the listed mortgagor.
If not available, is this person a relative?
a)
Spouse - continue with interview.
b)
Relative - ask person if mortgagor lives there. Then ask
them to
give call back to mortgagor unless your client has
requested otherwise.
c)
Other - ask person if mortgagor lives there. Then ask them
to give call back to mortgagor unless your client has requested
otherwise.
d)
Child - ask if mortgagor lives there. Then ask child to give
call back to parent unless your client has requested otherwise.
e)
Tenant - Go to “Tenant Interview“.
M
PL
1)
2)
E
There is nothing difficult about a delinquent interview. The purpose is to
gather information for the Mortgage Company. The request involves going
to the address provided, asking for the person identified on the form as the
borrower or mortgagor and asking that person a few questions regarding
their loan and their ability to re-pay it.
SA
* Many times a client will prefer the call back notice be placed in a sealed
envelope with the borrower’s name written on the envelope and the words
“Personal and Confidential”. It is wise to place the notice in a sealed
envelope, even if your client has not asked you to. By placing the notice in
a sealed envelope, you are making an active attempt to protect the privacy
of the borrower and you reduce your risk exposure to claims that you have
violated their privacy.
Direct Borrower Interview
1)
2)
3)
If spouse, ask spouse's name.
Ask if mortgagor has spoken with their lender lately regarding the
mortgage.
Ask for phone number with area code.
67
Winterizations
E
PL
Steel doors may be braced with two
pieces of 2 x 4 consisting of a stop
plate on the floor and a piece going
from under the doorknob to the stop
plate at a 45-degree angle. Make
sure that the door and both pieces
of wood are snugly in place. Tug
on the doorknob to make sure that
everything is secure and the door
cannot be opened.
Check Your Local Specifications & Requirements Variation (s) Per Region
and / or City
M
Winterization is performed to keep the property safe from water freezing
inside the plumbing system when temperatures drop below 40 degrees.
Almost all areas of the United States have vacant properties winterized
with few exceptions such as Florida and Hawaii where the temperatures
rarely ever go that low.
SA
Environmentally safe antifreeze
should be in the toilet. It is pink in
color and should be a solid pink. If it
is pale or barely pink, or if it has
evaporated, make notes to your
client that the winterization should
be re-done or re-freshened. As an
inspector, it is important for you to
report on this critical element of
protective services.
If there are feces in toilets, if there is water flowing from a basement faucet
– or worse, an upper floor faucet – you need to let your client know. It is
possible that for your area, the property has not been vacant long enough
89
currently installed, only one window was damaged by the fire”. Always be
as thorough in your report as possible, following your client’s directives.
PL
E
You may be asked for a business card by either the homeowner and / or
contractor. Providing your card will help validate your legitimacy as a
business person performing a legitimate task on behalf of the lender.
However, often, you may receive a call at a later date from the
homeowner or contractor requesting a follow-up inspection. It is imperative
that you explain performing the inspection without authorization is
impossible. Always direct the homeowner or contractor to their contact at
the bank for future inspections. If you performed the inspection without the
required written request, your chances of being paid are slim to none and
the homeowners chance of receiving the draw needed will also be slim to
none.
Construction Draw Inspections
SA
M
The purpose of a construction draw
is to assist the lender in making
scheduled payments to a builder
while a structure is being built.
Typically, a home (or commercial
building) is designed and the exact
costs of all aspects of the
construction are detailed in a plan
called a “project scope”. The builder
may even have a time-line
projected for each phase of the
construction. The lender agrees to
make a loan for the complete cost
but provides the funds based upon
progress of the build.
104
be familiar with construction terminology, be able to identify structural,
mechanical and cosmetic defects. You should also have a working
knowledge of approximate costs to make needed repairs.
PL
E
Generally, your contact has applied for a loan and has supplied the lender
with a list of needed repairs, an estimate of cost to repair and a repaired
value estimate. The lender will supply these to you along with the
questionnaire. The questionnaire covers the present condition of the
property and is usually a simple YES/ NO format. Everything from the
foundation, HVAC, drainage, flooring, walls, roof, plumbing and electrical
systems must be checked for operability and soundness. You are not
guaranteeing any aspect of the property, merely reporting on the visual
appearance and making a determination as to whether or not the estimate
to repair is all-inclusive or if additional work and costs are needed. If
additional work is needed, it must be annotated along with the
approximate cost of the additional repairs.
M
Do not accept these inspections if any aspect is unfamiliar to you or if you
cannot provide estimated costs. Photos may or may not be required. An
appointment is always needed to perform the interior inspection.
SA
When you arrive, inspect the exterior and compare it to the inspection
details provided. Then complete the interior inspection. Usually the
inspection will request that you verify
the furnace works. You would turn
the thermostat up and allow the heat
to come up to temperature and then
shut down. If the furnace fails to turn
on, fails to come up to temperature,
or does not shut down automatically,
there should be a line itemizing
HVAC repairs or replacement. You
will either answer yes or no for the
HVAC detail line. If there are no
expenses listed for HVAC you need to annotate it and write in an
approximate cost for replacement.
119
the car. Never discuss with anyone the nature of your business - simply
attempt to extract information about the borrower and vehicle location.
Never, ever reveal the purpose of your visit to a neighbor.
E
The Vehicle Inspection
PL
1) Some clients will want
photos. Take a photo
showing the entire vehicle.
SA
M
2) Annotate the VIN located on the driver’s side
windshield
of
the
dashboard. You can look
in and see it there. Write
down the VIN. The client
will usually provide either
the complete VIN or the
final digits of the VIN so
you can verify you are
inspecting
the
correct
vehicle.
126
Places on the Internet to Learn More
PL
American Society of Home Inspectors
Association of Construction Inspectors
Society of Field Inspectors
Yahoo Groups - Mortgage Field Services
E
You can never know enough! You will always be learning something new
– I know after 16 plus years in the industry, I am. So, the best thing to do
is search out those resources readily available. One thing is for sure, there
is far more information readily available today, due to the internet, than
there was when I first started in 1991. Take advantage!
Where to Look for Clients
SA
M
Again, there is so much more available today that finding clients will be
easy. The difficult part will be negotiating fees and being paid. The best
advice I can offer is to check a company out before taking on a volume of
work with them. If the company wants you to sign contracts, have your
attorney review it before you sign it. Before you extend credit to a
company, check out their credit first! Knowx.com is a business to business
reporting agency that can provide credit reports on companies. Dunn &
Bradstreet is a business to business collection agency and credit reporting
company. Don’t jump blindly into offering high volumes of service to a
company before checking them out and do not be intimidated by their size.
If they do not pay you, turn the account over to a collection agency!
A very complete list of companies that may hire your services is available
on the internet at
http://www.google.com/Top/Business/Financial_Services/Field_Service_C
ompanies/
http://www.google.com/Top/Business/Financial_Services/Insurance/Agent
_Resources/Field_Service_Companies/
130