Orientation vs Onboarding

In fact, leaders of companies that go from good to great start not with “where” but with “who.” They start by getting the right people on the bus, the wrong people off the bus, and the right people in the right seats. – Jim Collins, author of Good to Great – Why Some Companies Make the Leap and Others Don’t

Jim Collins had it right. But hiring the right people and putting them in the right place in the organization is just the beginning. After the hiring comes the orientation. And after the orientation comes the onboarding. In this column we will discuss the difference between the two, emphasize why onboarding is so important and give some examples.

Let’s begin with how not to do orientation. The worst example of orientation this writer has ever heard of went something like this:

“There’s the desk. There’s the phone. Good luck kid. You’re on your own.”

Ouch. Unfortunately, more than a few employees feel that they were not given a proper orientation for the job that they were hired to do. Some of it involved basic things, such as how to make copies or how to transfer a telephone call. Some of it involved major things such as what to do id a VIP calls or shows up at work.

What is orientation?

For our purposes, orientation is the process of introducing and aligning a new employee to the practices of the new employer, such as new surroundings, activities, etc.  It is typically a brief event, sometimes only one day. It covers the essentials, things like where to park, where and when to go to lunch, location of bathrooms, use of computers, forms, email, policies and procedures. It is in effect a checklist.  It usually occurs in the first day or few days of employment.

What is onboarding?

Onboarding is often described as organizational socialization. There is no one size fits all when it comes to onboarding because each company is different. Onboarding goes on much longer than orientation. It is designed to integrate and match the employee’s personality, skills and behavior with the practices, customs and values of the organization. By the way, training is different than orientation and onboarding.

Why do onboarding?

According to a 2007 study by the Wynhurst Group, when employees go through structured onboarding, they are 58% more likely to remain with the organization after three years. Also consider Gallup’s State of the American Workplace report that was issued in 2014. It found that that more that employees believe the job market is opening up, the less likely they may be to stay in roles that don’t meet their needs and expectations.  The study found that more than half of employees (51%) say they are actively looking for a new job or watching for openings, and 35% of workers report changing jobs within the past three years.

Each workday, Gallup posts the percentage of employees “weekly engaged at work” on the News section of gallup.com. As this column is being written, the number stands at 36.7%, a percentage that has moved up five points in recent weeks. Gallup defines engaged employees “… as those who are involved in, enthusiastic about and committed to their work and workplace.” Gallup categorizes workers as “engaged” based on their responses to key workplace elements it has found predict important organizational performance outcomes. Onboarding increases the likelihood that employees will remained engaged employees.

Another reason to do onboarding is that it shows that the company is making an investment in its employees. Is there a way to determine if this investment pays off? Companies that value employees are more successful if one considers the return on investment in Fortune magazine’s list of 100 Best Companies to Work For. Tracked for 15 years: Stock in Fortune magazine’s “100 Best Companies to Work For” way outperformed both the S&P 500 and the Russell 3000 indices. Specifically, from 1997 – 2013 the S&P 500 had an annualized stock market return of 6.04%, the Russell 3000 had an annualized return of 6.41% and the Fortune 100 Best Companies to Work Far had an annualized return of 11.8%.

Implementing Onboarding at Your Company

Depending on the size of your company an onboarding plan may need to involve coordination between many departments. It is a process that requires time and commitment.

One of the best and most comprehensive onboarding programs is that of Disney’s College Program. Check out the website for ideas about what to include in the onboarding process. It’s at
http://cp.disneycareers.com/en/onboarding/fl/default/

Zappo’s onboarding process has gotten a lot of attention because of its thoroughness and emphasis on culture at the organization. At the end of the first month, any new employee who doesn’t feel they’re a good fit is offered $2,000 to quit.

Sapling, a San Francisco company that specializes in onboarding, states that effective onboarding programs share the themes listed below.

1.Make the investment: these onboarding programs are not an accident; the companies listed invest heavily in time and money to support new employees to be successful.
2. Start early: make sure everything is ready before the employee starts their first day to make sure they can hit the ground running.

3. Company Culture is everything: over invest in making new employees feel welcome and aligned with company values.

4. Get the team involved: Welcoming them into an inclusive, dynamic team with lots of communication that will have real returns on their ability to integrate with the team effectively.

5. Clear Roadmap: Giving new employees a clear and structured path for their integration into the company supports them to be productive and successful in their new role.

6. Training and development: Help new employees learn with the right training tools, and by giving them practical skills so they can start contributing as soon as possible.

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Looking at Mississippi from an Ireland reporter’s eyes

August 10, 2017. It is the final morning of a wonderful vacation in Ireland. Up early, I reflect on the kind and welcoming people of Ireland we have met. I marvel at Ireland’s ability to attract businesses to the Emerald Isle. Google, Accenture, Facebook, Paypal. The list goes on and on. I compare and contrast Ireland’s business attraction efforts with those of Mississippi. Lots of similarities, especially when it comes to using tax incentives as inducements.

Being the news junkie I am I go down to the lobby of the Dublin hotel and fetch the day’s edition of the Irish Times. There in the top right hand corner of the front page I discover this 5 x 2.5 inch preview box: “Travels in Trump’s America. Oxford, Mississippi attempts to move on from its history of segregation.”

Oh no, I think. Here we go again. Another example of Mississippi’s history of race relations continuing to be the proverbial albatross around its neck. How does that affect international business attraction? I tell myself not get too defensive. Perhaps the article will turn out to be positive. After all, Oxford, Mississippi is a desirable place. I open to page nine. The headline there reads, “Segregation still alive and well in the deep south.” I delve into the report. My coffee is getting cold.

The story is part of a series about an Irish Times reporter’s visit to America. Each day a different state. I read page nine.

In the middle of the page is a large black and white photograph of James Meredith surrounded by students at Ole Miss in 1962. Below are two more photographs. These are in color and depict two African-American women. In bold print below them reads, “Mississippi, a state with a population of approximately three million, still has one of the highest proportions of black people in the US.”

The article opens with an account of James Meredith’s entry into Ole Miss and the surrounding events followed by the reporter’s perception of Oxford today. It is mostly complimentary. The opening sentence: “Today the old university town of Oxford, Mississippi, is the picture of of southern refinement.” The closing sentence: “After a leisurely stroll around the bookshops I reluctantly leave the slow-paced vibe and drive westward through Mississippi.”

The next paragraph has a subhead: “Slave Labor,” and then goes on to recount a brief demographic history of the Delta followed by the subject of the Cleveland School District case.” It’s a long section. The article’s closing sentence reads, “As I leave Cleveland and trace the trajectory of the Mississippi river upstream toward Memphis, it’s clear the problem of racial segregation has yet to be resolved.”

My reaction to this article is conditioned by my background in economic development. I think about what it would be like if on this day if I was on a recruiting trip to Ireland to meet with a company about opening a branch office or manufacturing facility in Mississippi. Then I think about Mississippi’s current international recruiting efforts.

In spite of stories like the above in world newspapers the Mississippi Development Authority, the state’s business recruiting agency, is doing admiral, even incredible work. Its successes have been recognized recently with national awards and rankings in economic development and business magazines. It has offices in other countries. German manufacturer Continental Tire has a plant under construction. International companies such as PACCAR, Airbus Helicopters and Yokohama Tire, are changing the economic landscape in the Golden Triangle. Nissan and Toyota have world-class manufacturing facilities in Mississippi. We are accomplishing significant workforce development outcomes with our nationally-ranked community colleges in partnership with international companies.

So where do we go from here? The answer is that we keep focusing on the good things and working on the not-so-good things. One strategy that works well in spite of the above newspaper reporter’s visit is to attract visitors to Mississippi so that they can see for themselves. And let’s not forget the student international visitors. According to the US Global Leadership Coalition, during 2015, 3,101 international students were enrolled in Mississippi colleges and universities and contributed $65 million to the Mississippi economy. Hopefully they had a positive experience and will tell their stories in their home countries.

Also, we must remember that in spite of our image overall, business leaders evaluate relocations based on many factors.

Mississippi is a paradox in so many ways. It has some of the best things in the world going for it while at the same time having many things that need some work. It is not a one-subject story.

Link to the Irish Times article:

https://www.irishtimes.com/news/world/us/history-of-segregation-still-evident-in-mississippi-region-1.3181796

How the Irish Times sees Mississippi

August 10, 2017. It is the final morning of a wonderful vacation in Ireland. Up early, I reflect on the kind and welcoming people of Ireland we have met. I marvel at Ireland’s ability to attract businesses to the Emerald Isle. Google, Accenture, Facebook, Paypal. The list goes on and on. I compare and contrast Ireland’s business attraction efforts with those of Mississippi. Lots of similarities, especially when it comes to using tax incentives as inducements.

Being the news junkie I am I go down to the lobby of the Dublin hotel and fetch the day’s edition of the Irish Times. There in the top right hand corner of the front page I discover this 5 x 2.5 inch preview box: “Travels in Trump’s America. Oxford, Mississippi attempts to move on from its history of segregation.”
Oh no, I think. Here we go again. Another example of Mississippi’s history of race relations continuing to be the proverbial albatross around its neck. How does that affect international business attraction? I tell myself not get too defensive. Perhaps the article will turn out to be positive. After all, Oxford, Mississippi is a desirable place. I open to page nine. The headline there reads, “Segregation still alive and well in the deep south.” I delve into the report. My coffee is getting cold.
The story is part of a series about an Irish Times reporter’s visit to America. Each day a different state. I read page nine.
In the middle of the page is a large black and white photograph of James Meredith surrounded by students at Ole Miss in 1962. Below are two more photographs. These are in color and depict two African-American women. In bold print below them reads, “Mississippi, a state with a population of approximately three million, still has one of the highest proportions of black people in the US.”  
The article opens with an account of James Meredith’s entry into Ole Miss and the surrounding events followed by the reporter’s perception of Oxford today. It is mostly complimentary. The opening sentence: “Today the old university town of Oxford, Mississippi, is the picture of of southern refinement.” The closing sentence: “After a leisurely stroll around the bookshops I reluctantly leave the slow-paced vibe and drive westward through Mississippi.”
The next paragraph has a subhead: “Slave Labor,” and then goes on to recount a brief demographic history of the Delta followed by the subject of the Cleveland School District case.” It’s a long section. The article’s closing sentence reads, “As I leave Cleveland and trace the trajectory of the Mississippi river upstream toward Memphis, it’s clear the problem of racial segregation has yet to be resolved.”
My reaction to this article is conditioned by my background in economic development. I think about what it would be like if on this day if I was on a recruiting trip to Ireland to meet with a company about opening a branch office or manufacturing facility in Mississippi. Then I think about Mississippi’s current international recruiting efforts.
In spite of stories like the above in world newspapers the Mississippi Development Authority, the state’s business recruiting agency, is doing admiral, even incredible work. Its successes have been recognized recently with national awards and rankings in economic development and business magazines. It has offices in other countries. German manufacturer Continental Tire has a plant under construction. International companies such as PACCAR, Airbus Helicopters and Yokohama Tire, are changing the economic landscape in the Golden Triangle. Nissan and Toyota have world-class manufacturing facilities in Mississippi. We are accomplishing significant workforce development outcomes with our nationally-ranked community colleges in partnership with international companies.
So where do we go from here? The answer is that we keep focusing on the good things and working on the not-so-good things. One strategy that works well in spite of the above newspaper reporter’s visit is to attract visitors to Mississippi so that they can see for themselves. And let’s not forget the student international visitors. According to the US Global Leadership Coalition, during 2015, 3,101 international students were enrolled in Mississippi colleges and universities and contributed $65 million to the Mississippi economy. Hopefully they had a positive experience and will tell their stories in their home countries.
Also, we must remember that in spite of our image overall, business leaders evaluate relocations based on many factors.
Mississippi is a paradox in so many ways. It has some of the best things in the world going for it while at the same time having many things that need some work. It is not a one-subject story.
Link to the Irish Times article:  

Escape Rooms Sweeping the Nation

Kimberly wasn’t so sure she wanted to participate in the so-called Collaborate Problem Solving Activity that was on the agenda at the conference she was attending. “I hear they lock you in a room with other people and the group has to solve some kind of puzzle to get out.”

“Oh, don’t worry,” someone said. “It’s a lot of fun. I did one of those things in Dallas last year. The time goes by really fast. Besides, there is an escape door if you feel you have to leave. We’ll have to find clues to escape.” She held up both hands and make the quotation marks sign with her fingers when she said the escape word.

Escape Room is a team building/leadership activity that is sweeping the nation. It’s a race against the clock to find clues that will lead to the way to escape from the room. All kinds of groups, from corporate teams to students to family members, are taking the challenge. And if reviews on social media are any indication participants are enjoying the experience.

“This is not a scare room or freak show. It is an exciting game of strategy, critical thinking and fun,” according to one online reviewer.

It just so happens that I was at the conference mentioned above and was asked to serve as the moderator of three rounds of Escape Room games. Each round involved two separate groups being locked in two separate rooms, one of which was themed as The Titanic and the other The Forbidden Tomb. My job was to debrief the participants and asked what they had learned or observed from a team building standpoint. It was a fascinating exercise.

In this case, there were eight people in each group. I’ll call them Group A and Group B. I had the pleasure of sitting inside the control room with the operators and watching both escape rooms via several monitors in each room. It was all I could do not to try to assist the participants in some way.

From a leadership and team building standpoint, I observed two methods of communicating and strategizing that were especially revealing. It involved a clue in the Titanic Room that could be found when the participants discovered an envelope containing a letter from the captain of the ship. The participant in the first group who found the letter read it to himself very carefully. He may have even read it twice. I would even go so far as to say that he studied the letter. The other members of his group anxiously watched as he read the letter. Finally, he told his fellow group members what the letter said. They began discussing the implications of the letter and whether it led to another clue. Of course it did, so they immediately began searching. Ultimately, they found the sought-after clue.

The Group B participant who found the same letter took a different approach. Upon finding the letter he announced that fact to his group and told them to “Listen up.” He then opened the envelope and read the letter aloud. The group members immediately began discussing what they had heard. Someone made a suggestion about what the letter/clue meant. The hunt was on for the next clue. They found it in no time.

It turned out that Group A did not make it out of the room in the allotted time. To put it another way, they sunk. Group B made it out with time to spare.

The lesson learned was that when time is critical it is best that everyone involved receive the same information at the same time. When time is not of the essence then it is certainly appropriate for the leader to digest the information first and then tell his team about new information.

Escape Rooms are growing in number, and not just because of their popularity. They also provide good income for the operators/franchisees. According to a July 21, 2015 MarketWatch.com article by Sally entitled “The unbelievably lucrative business of escape rooms,”  the first investor in an escape room facility recovered his $7,000 investment in only a month. By mid-2015 the number of permanent rooms world-wide has gone from zero at the outset of 2010.

A search online for Escape Rooms in Mississippi revealed locations in Tupelo, Starkville, Jackson, Hattiesburg and D’Iberville. Prices per person ranged from $20 – $25 for a 45-60 minute experience. Themes vary. For example, right now in Tupelo there is one room titled “The Office Of Secret Agent 22”, which invites players to, “Step back to 1982 and join the CIA to help find missing Agent 22.” It’s a 60-minute game. There is also a 30 minute version called “The Mine,” where players “Find the Copperpot treasure and escape before their old family mine is demolished.”

For corporate teambuilding or family fun check out an Escape Room near you.

On Being a Mississippi Tourist at the Grammy Museum

(My column this week in the Mississippi Business Journal)

My wife and I became Mississippi tourists on a recent Monday holiday and motored to the Delta town of Cleveland to check out the Mississippi Grammy Museum. We had been meaning to go since its opening in March of 2016. It is, after all, a national attraction in our own backyard. We were not disappointed, but what happened on the way there and back was half the fun.

On the way, we enjoyed the flat earth, early growth crops of corn, cotton and the greenery of the late spring fields. It was a cool, cloudy day. We nodded our approval of the flashing four-way stop sign at the intersection of Highways 7 and 8 in Holcomb. During the I-55 portion of the trip, wife Carol read aloud from the current issue of Garden and Gun magazine, its current issue featuring an article by Greenville native Julia Reed and a mention about the Bentonia Blues Festival coming up June 12 -17. I learned a lot about the legendary Jimmy “Duck” Holmes, owner of the Blue Front Cafe, including the fact that his hands and guitar grace the Mississippi Statehood Forever Stamp issued in March. I made a mental note to take the U.S. Highway 49 route on our return trip and make a stop in Bentonia.

We arrived in Cleveland just after lunch and satisfied our hunger at the Airport Grocery, which is a rustic “eat place” that includes pool tables, farm antiques, a bar and even blues music on certain days. The grilled catfish was excellent.

The Mississippi Grammy Museum, located adjacent to the Delta State university campus, is a high tech music mecca where visitors learn, experience and are just blown away by music of all types, especially the music of Mississippians. The museum exceeded expectations. Check out www.grammymuseumms.org, and you’ll see what I mean. The current featured exhibit is about Taylor Swift. If you are one of her fans this is as comprehensive an exhibit about her life and music as you will find.

Afterwards, we drove around the Delta State campus, which looks better than ever. Under the leadership of President Bill LaForge  it now has over 3,500 students and is affiliated with the Grammy Museum. Its Delta Music Institute, which is located on campus, offers students the opportunity to learn about and study the music industry. It even offers a Bachelor of Science degree in Entertainment Industry Studies.

Driving back through Yazoo City and points south we marveled at the kudzu-encased trees and structures now looking like randomly placed art installations. As we approached Bentonia we just had to stop by the Blue Front Cafe. Even though I had never been there I had heard about it a few years earlier from some European visitors to the 2014 USA International Ballet Competition in Jackson. They said they had heard about a juke joint in Bentonia, and wanted to visit it after the ballet competition one Friday evening. I can now see why.

The text on the Mississippi Blues Trail marker in front of the place reads in part as follows:

“During the 1980s and ’90s the Blue Front Café began to attract tourists in search of authentic blues in a rustic setting. In its early years, the café was a local gathering spot for crowds of workers from the Yazoo County cotton fields. Carey and Mary Holmes raised their ten children and three nephews and sent most of them to college on the income generated by the café and their cotton crops. The café offered hot meals, groceries, drinks, recreation, entertainment, and even haircuts.

The Holmes family operated under a tangled set of local rules during the segregation era. The Blue Front was subject to a 10 p.m. town curfew, but at the height of cotton gathering and ginning season, the café might stay open 24 hours a day to serve shifts of workers around the clock. The Blue Front could not serve Coca-Cola, however, nor could black customers purchase it or other items reserved for whites anywhere in Bentonia; African Americans were allowed only brands such as Nehi and Double Cola. Still, white customers regularly bought bootleg corn liquor at the back door of the café. After integration, the Blue Front boasted its own Coca-Cola sign.

Music at the Blue Front was often impromptu and unannounced. The café seldom advertised or formally booked acts. Many itinerant harmonica players and guitarists drifted through to play a few tunes, but at times the musical cast included such notables as Skip James, Jack Owens, Henry Stuckey, Sonny Boy Williamson No. 2 (Rice Miller), and James “Son” Thomas.

Musicians also performed at Carey Holmes’s outdoor gatherings on the family farm, which later evolved into the Bentonia Blues Festival, sponsored by Jimmy Holmes. Jimmy Holmes’s first two CDs, released in 2006 and 2007, were recorded at the Blue Front, perpetuating the music he learned in Bentonia from Jack Owens and others.”

Now on this lazy, now sunny, afternoon we pulled up and parked in front of the cafe. Sitting on a bench in front was a man whom we soon learned was none other than Jimmy “Duck” Holmes himself.  We went inside to the vacant juke joint where we sat and talked with him almost an hour and each enjoyed a cold beer. We marveled at his guest register which had names and comments from visitors from all over the world.

In the words of Carol, “Such a nice man. Such a nice day! Home before dark. Can’t wait to be a tourist again!”

It’s all about value.

Question: Our business wants to increase sales, but is having a difficult time because there is a lot of competition in our town. A consultant told us that customers did not perceive our business as providing as much value as our competitors. Our prices are already the same or lower. What can we do?

A: Value is more than just a lower price. For some reason, your competitors’ products or services are seen by customers as offering more value even though they cost more. If your competitor has a website and allows comments spend some studying why their customers like that business. Likewise, review your own customers’ comments. If you don’t have a website allowing comments consider starting one. You may also want to survey your customers using comments cards. Also, raise your prices to at or near your competitor’s levels. The recent Sauve/Evause case illustrated why many customers perceive there to be a relationship between price and value.

Q: What is the Suave/Evuas case?

A: Earlier this year the company that manufacturers Suave shampoo, one of the cheapest (and one of the best?) products in the category, launched a campaign for Evaus shampoo at a price in the range of the most expensive shampoos. There were comparison tests with the most expensive shampoos, marketing messages and more. Users were then told they were not in fact using some new expensive shampoo, but were using Suave instead. By the way, I checked the price at a local drug store last week – $1.00 for a 12 oz. bottle. Most users in the tests rated the Evauas as equal to or better than the expensive shampoos in the test. What does this mean? Obviously, it disproves the saying that you get what you pay for. Indeed, research shows that seven out of ten women think that expensive brands work better than inexpensive ones. Check out more at www.EvausIsSuave.com. Way to go Suave.

Q: What creates value?

A: In general, the four things that are the components of value are:

Demand – the market is willing to buy the product or service;

Utility – the product or service provides something that is useful, i.e. can be utilized;

Scarcity – there is a limited supply; and

Transferability – ownership must be given from the seller to the buyer.

For example, a house would have no value if no one wanted to buy it, or it had smoke damage and was unlivable, or if plenty of houses were available or it could not be sold because of deed restrictions.

In another example, a newspaper would have no value if there were no subscribers, or the newsprint was unreadable, or there were plenty of free similar newspapers or newspaper sales were illegal.

Q: What is market value?

A: The most common definition is the one used in the real estate appraisal industry. It goes like this: “The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each axcting prudently, knowlldegeably and assuming the price is not affected by undue stimulous. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (1) buyer and seller are typically motivated; (2) both parties are well informed or well advised, and each acting in what he or she considers his or her own best interest; (3) a resonable time is allowed for exposure in the open market; (4) payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto: and (5) the price represents the normal consideration for the property sold unaffected by special or creative financing or sales conscessions granted by anyone associated with the sale.”

Q: If market value is the most probable sales price, what would be the highest price?

A: I suggest that sentimental value is probably the highest price a product would bring. For example, my first car was a 1968 Chevrolet Camaro. If I could by that specific car I would be willing to pay more than market value. Nostalgia has a way of influencing value. If I could buy my grandparents’ homestead I would pay more. What would the wedding ring my great grandfather gave to my grandmother be worth to me. Probably a lot more than to anyone else because of its sentimental value.

Q: What would be the lowest value?

A: The lowest value of a product or service is one that involves the need for a quick sale. It’s often called liquidation value, such as a true going out of business sale. If the seller is desperate to sell the product or service, then the price will be lower. Hence the adage, “You make money when you buy, not when you sell.” Most of the successful investors I know say they never pay market value.

Q: Is it possible that there is something that has no value?

A: I would argue that everything has some value. However, using the definition above it is logical to assume that everything has a price. And yet it would be difficult to purchase the USS John C. Stennis aircraft carrier or the Crown Jewels of the United Kingdom because at this point in time their ownership is not transferable.

Frank the Foreclosure Man

Are you several payments behind on your mortgage and not been able to get any more relief from your lender? The next person you see at your door just might be Frank the Foreclosure Man.  Do not be surprised to discover that Frank is not from your mortgage company.

Frank the Foreclosure Man is a composite I made up to describe what is generally referred to as a foreclosure specialist or foreclosure broker. It was the early 1980’s when I first met Frank, a man who made his living off foreclosed properties.  Back then, interest rates were skyrocketing, homeowners were having trouble selling, and foreclosures were going up. Frank appeared on the scene, sought out desperate homeowners and attempted to get them to sell their homes to him for the amount in arrears. Frank then resold at a higher price or took the unsuspecting owner on the ride of his financial life.  Frank disappeared for a while after interest rates went down and the real estate market got hot, but now he is back. It’s not because foreclosure rates are going up.

According to RealtyTrac, (www.realtytrac.com) an industry organization that maintains a nationwide database of foreclosures, foreclose rates are going down. Its market summary there are currently (March 2017) 808,143 properties in U.S. that are in some stage of foreclosure (default, auction or bank owned). In February, the number of properties that received a foreclosure filing in U.S. was 1% lower than the previous month and 16% lower than the same time last year. Home sales for January 2017 were down 26% compared with the previous month, and down 76% compared with a year ago. The median sales price of a non-distressed home was $215,000. The median sales price of a foreclosure home was $126,000, or 41% lower than non-distressed home sales.

Nationally, one in every 1,609 housing units were in some form of foreclosure. The Top Five States were as follows:

New Jersey -1 in every 581;

Delaware – 1 in every 654;

Maryland – 1 in every 743;

Illinois – 1 in every 886; and

Nevada – 1 in every 1070

In Mississippi one every 2985 housing units were in some form of foreclosure. The following counties were listed as the Top Five:

Hinds -1 in every 589;

Pearl River – 1 in every 2011;

Hancock – 1 in every 2224:

Rankin – 1 in every 2367; and

De Soto – 1 in every 2389.

If foreclosures are down, why is Frank back? I suspect it has something to do with television shows and other marketing selling courses on how to buy foreclosed properties and flip them. Whatever the case, it pays for homeowners in mortgage trouble to be especially aware. Let’s learn more about how Frank operates.

Frank the Foreclosure Man awakens each day and immediately checks the newspaper.  He does not care about the news; he goes straight for the legal notices. There he scans the foreclosure section and makes a list of houses in certain neighborhoods.  Some of these houses he will want to buy and others he will want to negotiate with the owner.  His goal is to find homeowners who are behind on their payments, but have a lot of equity in their property.  He is especially in search of owners who are desperate.  He knows that desperate owners feel that they have only two choices – lose their home to a foreclosure sale or negotiate with Frank to keep their home.

Frank calls on the owner and says that he may be able to help in these desperate times.  In Mississippi a lender can foreclose on a home in a matter of several weeks after giving public notice.  In some states it takes several months.  Frank points out to the owner that if the property sells for less than the mortgage balance plus expenses then the owner may have a judgment placed against for the remaining balance.  And then there is that nasty matter of a credit rating that will certainly be affected.  The owner, not wanting to lose his home, his credit rating and more, listens to Frank.

Frank’s offer is rather straightforward.  Frank will buy the property for the back payments and then lease the house back to the owner until the owner can get financially back on his feet.  Frank even promises to resell the house to the owner for only a small profit for Frank’s time and effort.   Frank whips out a warranty deed and has the owner signs the property over to him.

Now it gets interesting.  Depending on the circumstances, Frank might just hold onto the deed and collect payments from the owner. He will use that money, plus his own, to make up the back payments so that the foreclosure does not go forward.  He might begin advertising the property for sale at market value.  If he finds a buyer he might evict the owner, file the deed and then sell to the new buyer.  That can result in a hefty profit.  Sometimes the old owner does not make the payments to Frank, moves out and leaves a vacant house.  In that case, Frank may even rent it if he can get more in rent than the mortgage payment, or he may sell it.

So, is Frank the Foreclosure Man in a legitimate business?  As long as there are no misrepresentations to the owner or the lender, Frank may very well be providing a valuable service.  Websites are also popping up offering programs to teach you how to be a foreclosure specialist.  There is probably a cable television program on the subject by now.

Is Frank the Foreclosure Man a piranha?  That’s what one state attorney general calls foreclosure specialists.

If you are a homeowner who has received a foreclosure notice, contact an attorney and discuss your legal rights.  I would advise you to contact your lender, but I am assuming that because foreclosure proceedings have begun you have already done that with unsuccessful results.  By all means, do not sell your house for less than market value without being fully informed.

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