Home Buying in Mason>Question Details

Bharaty, Home Buyer in Mason, OH

I have a property that I want to buy. The guy who is selling it is an "investor" doing a short sale flip. My mortgage broker talked to

Asked by Bharaty, Mason, OH Fri Sep 18, 2009

him and says that what he is doing is borderline illegal. The property is on sheriff's sale as well. I am confused. Can you advice?

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Mark Ryan’s answer
First, I would say the "investor"... haha Makes a good point it is EITHER legal or not... Not it can still be legal and NOT be ethical... two different things...

There are just so many issues that could be in play her and different things to consider I would highly suggest your discuss this transaction with a Realtor. While I respect mortgage brokers and think they perform some great duties, they are not real estate professionals... just like I don't think most agents should advise their clients on complex mortgage issues, I don't think mortgage brokers should practice beyond their expertise.

Discuss this issues with me if you would like, I am a Certified Distressed Property Expert http://(www.CDPE.com) or find another CDPE you like and trust. I do work in your area and specialize in short sale transactions.

I am not a high pressure guy, call and we can go over the "deal" over the phone... happy to help.

Thanks,

Mark
1 vote Thank Flag Link Fri Sep 18, 2009
Hey there Bharaty....

I always wonder why, when people talk about "investors", they tend to refer to us "investors" in conjunction with quotation marks. :-) As if we are some mythical creature or some by-product of a "Real Person".

Short Story:
I know a gentleman who, when he called his state legislators about some pending legislation on foreclosures, and said that he was a Real Estate Investor......CLICK - Buzzzzz. (hung up on) But when he called back and said that he is part of a HUD certified counciling center....oh....well...."you don't mind if we ask you your advice on how we write our legislation do you?"

And your mortgage broker may want to start educating himself/herself. It's either LEGAL or NOT LEGAL. There is no such thing as borderline illegal....That's like being kinda-maybe pregnant. :-) Your mortgage lender may not have been exposed to this type deal, so their first response is that since THEY haven't done one before....that something's wrong or illegal with it.

Being that all the information is not present here in this discussion, I can only hope to point to an answer with the limited amount at hand.

As far as the sheriff's sale...maybe it's on hold. I don't typically deal with auctions and sheriff's sales because they are different in every state (let alone every county). That's not my area of expertise.

And YES...it's possible to "flip" (as most people in the public refer to it) a short sale. It's done with option agreements, assignment contracts, and many things that most people haven't been educated upon. That's where we Investor's come into play. We create solutions.

Here is a link to a simple example of how it's done:
http://shortsaleinvestingblog.com/category/short-sale-investing

It can be done with double closings/simultaneous closings. If you haven't already done so, I would definitely acquire the services of a KNOWLEGEABLE closing Attorney/Title Company. THEY would be able (not your mortgage lender) to tell you if this is a possibility. Make sure the Attorney is familar with the short sale process.

If everyone is communicating in the process and keeps an open mind, then there can be a solution where everyone wins. And that's what most of us are looking for in the first place....a win~win situation for everyone.

Best Wishes,

Darin
Investor
Web Reference: http://www.hhiinvesting.com
1 vote Thank Flag Link Fri Sep 18, 2009
Sounds like the Investor may be "hoping" to buy the property cheap at the Sheriff sale and then turn and sell it to you. Some investors call this wholesaling. You can also go to the Sheriff's sale and bid on the property yourself, you may get a better deal. Just make sure you inspect the property, do a search for liens, clear title, etc. If you have decent credit you can go to a small bank and get a Surety bond which is basically the bank guaranteeing the Sherriff that the property will be bought. Warren County requires that you put down 10% at the sale, which the small bank may be able to help you with. The bank will want to know what the highest amount your going to bid along with what the property is worth.
0 votes Thank Flag Link Sun Sep 20, 2009
Bharaty he could be doing and assignment of contract or has taken the property subject to. My concern would be if there was time to get the property pulled from sheriff sale and get an accepted contract. Without knowing the details it is hard to advise you on what to do. There are just over 14,000 properties available for sale on the Cincinnati MLS I am sure there is one that you would like without the drama.
Web Reference: http://www.Find1Home.com
0 votes Thank Flag Link Sat Sep 19, 2009
I would caution you that getting involved in something that is "borderline illegal" is just not worth it. That is why you should work with licensed professionals. Feel free to contact me direct if you would like to be represented by a licensed realtor with references. Having a licensed realtor work for you as the buyer does not cost you anything more.

Feel free to call me direct.

Sue Kirven
skirven@earthlink.net
Real Estate Professionals
513-295-2993
0 votes Thank Flag Link Fri Sep 18, 2009
In addition...I always advise to seriously consider an owner's policy of title insurance on any rehab / investor / short sale / REO / HUD / or forclosure property.
0 votes Thank Flag Link Fri Sep 18, 2009
One possibility might be that the investor you spoke with may not have title to the home, there by not having the ability to authorize a sale. If the sherriff's sale recording has been delayed and new title not yet recorded, I would proceed with caution. Would be glad to meet, have a look into the home and available data, and advise from there.
Regards.
0 votes Thank Flag Link Fri Sep 18, 2009
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