Replies to This Discussion

Permalink Reply by Smitty on August 30, 2011 at 2:39pm

MSI, your statements are EXACTLY the reason I feel the reason to educate people.  If you think I'm defending fraud, you should read my statements on this thread http://shortsalesuperstars.com/forum/topics/short-sale-black-list-pt-2

 

You'll have to do a lot better than that if you're going to cry fraud.  Just because someone can't see a house doesn't mean there is something fraudulent going on...maybe it's under contract, maybe the seller stopped the showings..you don't know and to say that because you can't see a house there is fraud is exactly why people in this industry are misinformed. 

Selling a 2B 2B house as a 1B 1B house again is NOT FRAUDULENT.  It's certainly an error that should be corrected immediately or brought to someones attention but it's NOT FRAUD.

As far as your bank in conconut grove...Is it privately held?  If so, they can do whatever the heck they want with the properties in their portfolio once they are REO's.  If the asset manager has an "inside list" he sells to, if it's a private bank, guess what?  They can completely do it.

 

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Permalink Reply by Richard on August 30, 2011 at 2:50pm

Guys...........the problem is, in most of these stories we will rarely, at best get both sides of the story.  It seems that lenders and sellers are never available to share their stories in forums.  This is the reason IMO, more visibility for transaction tracking purposes for both agents is necessary.

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Permalink Reply by MSI on August 31, 2011 at 3:52am

Stealing is a crime or a minor error in judgement? Should we reappeal the laws dealing with shoplifting?

If one commits crime and is not caught - is it still the crime? An innocent, uneducated strawbuyer - is he/she the victim or the the criminal?   

What would be the examples of fraud in this forum?

 

Smitty said:

MSI, your statements are EXACTLY the reason I feel the reason to educate people.  If you think I'm defending fraud, you should read my statements on this thread http://shortsalesuperstars.com/forum/topics/short-sale-black-list-pt-2

 

You'll have to do a lot better than that if you're going to cry fraud.  Just because someone can't see a house doesn't mean there is something fraudulent going on...maybe it's under contract, maybe the seller stopped the showings..you don't know and to say that because you can't see a house there is fraud is exactly why people in this industry are misinformed. 

Selling a 2B 2B house as a 1B 1B house again is NOT FRAUDULENT.  It's certainly an error that should be corrected immediately or brought to someones attention but it's NOT FRAUD.

As far as your bank in conconut grove...Is it privately held?  If so, they can do whatever the heck they want with the properties in their portfolio once they are REO's.  If the asset manager has an "inside list" he sells to, if it's a private bank, guess what?  They can completely do it.

 

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Permalink Reply by Jeff Payne on August 31, 2011 at 4:09am

I certainly don't think Smitty was defending fraud by any stretch of the imagination.  Fraud is a pretty strong word and the fact of the matter is that very few fraud cases are actually proven, I did a search for short sale fraud cases and found nothing, at least no convictions that I know of.

As far as a house not being able to be shown, if the seller is OK with that, then it is not an issue because the seller owns the home, they can choose whatever agent that they want to choose, no matter how bad that agent can be. 

There are 2 sides to every story and the truth usually lies somewhere in between.  Did you ever think that maybe the house that you think is intentionally not being shown already is under contract and the sellers dont want any more showings? To say that realtors are co operating in committing fraud is quite a stretch to me, at least when I try to find realtors who have been convicted of this type of activity, I have a hard time finding any.
REO properties quite often get sold without ever hitting the market.  I am working with a bank and an investor right now on 275 condo units that if sold will never have been on the market.  Not a thing unethical or illegal or fraudulent about it.  many of these banks have investor groups who purchase from them regularly, they buy the property or even buy the note even though it was never made available to the public.

As far as FDIC advertising 1 B 1B instead of 2B 2B, that is an easy fix where I am at, we just tell the MLS that it is advertised wrong and show them the proof and it is fixed.  Not sure what that has to do with fraud because if you knew they were actually 2B 2B, you then had an advantage and should have bought them.

There is actually plenty that you can do, but complaining isn't one of the more productive things.  File a complaint with FREC for real estate agent activity that you thing is fraud, file a complaint with the OCC against the banks. 

The one thing that you do need to remember is that the person who owns the house calls the shots, not the real estate agent.  Whether that is a private seller or an REO, just because you miss out on the home does not mean it is fraud.
MSI said:

There are people who will always defend any fraud. Here in Miami, fraud is rampant. Many houses for the short sales can never be viewed. They used to come on the market for few hours. Now days, they are listed for months but one can ever get to see them, let alone making a bid. You only see the eventual sale. None of these frauds can be executed without cooperating realtor. Like it or not - it is a fact.

Even the FDIC was selling the properties in a fraudulent manner by listing the 2B /2B property as 1B/1B or with incorrect address so the chosen few could bid.

Take a look at  one of the bank in coconut grove. It would appear that their REO properties are sold without ever hitting the market to select few..

There is nothing much one can do. There is no one in the government who wants to listen or take down a complaint.

Smitty said:

Harry, it clearly states she went to make an offer and someone else already had.  Where was the side stepping?  Did both offers come in at the same time? Even if they did it's up to the seller to sign ONE.  If the seller signed with the others, I don't see an issue.  A seller can take ANY offer they want.  Now if the sellers TOOK your friends offer, signed it, and the agent at hand WITHELD it to put in the other buyer's offer, THEN there is an issue.  I'm merely interpreting what I'm reading.  It doesn't say anywhere in the article she had a FULLY EXECUTED CONTRACT all it says is she went to place an offer in and was out maneuvered.  I've submitted offers for buyers higher than list only to find out a lower price was already accepted.  There is nothing "dubious" about it. 

She claims it's robbery!!!  How is it robbery?   If you know of something different please doooo tell!!!  Sorry. NO 3F's here.  She never had an executed contract.

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Permalink Reply by Jeff Payne on August 31, 2011 at 4:13am

OK I will bite.. Who stole from you?  What does shoplifting have to do with this topic?  Stawbuyers are illegal and anyone who participates in that activity might just have to face the consequences.

The OP was about Freddie Mac claims of fraudulent activity but their claims are very unsubstantiated in my opinion. 
Is is fraudulent to you for someone to buy a home and resell for a profit?
MSI said:

Stealing is a crime or a minor error in judgement? Should we reappeal the laws dealing with shoplifting?

If one commits crime and is not caught - is it still the crime? An innocent, uneducated strawbuyer - is he/she the victim or the the criminal?   

What would be the examples of fraud in this forum?

 

Smitty said:

MSI, your statements are EXACTLY the reason I feel the reason to educate people.  If you think I'm defending fraud, you should read my statements on this thread http://shortsalesuperstars.com/forum/topics/short-sale-black-list-pt-2

 

You'll have to do a lot better than that if you're going to cry fraud.  Just because someone can't see a house doesn't mean there is something fraudulent going on...maybe it's under contract, maybe the seller stopped the showings..you don't know and to say that because you can't see a house there is fraud is exactly why people in this industry are misinformed. 

Selling a 2B 2B house as a 1B 1B house again is NOT FRAUDULENT.  It's certainly an error that should be corrected immediately or brought to someones attention but it's NOT FRAUD.

As far as your bank in conconut grove...Is it privately held?  If so, they can do whatever the heck they want with the properties in their portfolio once they are REO's.  If the asset manager has an "inside list" he sells to, if it's a private bank, guess what?  They can completely do it.

 

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Permalink Reply by Janis Schade on August 31, 2011 at 9:55am

Working in primarily short sales, it's difficult to know who actually had the best offer when the home becomes "contingent".  Sometimes the terms may be more attractive than the price.  For example, cash is usually king.  I tell anyone thinking about putting in offer: It's usually not the first offer, or buyer, that ends up at closing.  Generally, the first buyer gets stuck in the waiting game.  Their offer only creates the "poking the bear effect".  They get frustrated and walk off.  The second buyer pokes the bear again, creating a new bpo.  This bpo is generally more realistic and comes in much faster.  If the first buyer loves the home, and is willing to purchase it either as a short sale, reo, foreclosure, whatever, their motivation will pay off.

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Permalink Reply by Richard on August 31, 2011 at 11:12am

 

Thanks for chiming in Janis......as a buyer, I've witnessed other agents saying the same.  I was told by another agent, "Why do all the work, just to have someone else swoop in near the end and take your prize catch", (kind of sounds the the Animal Kingdom show).  Anyway, it makes sense.  Your words are words of wisdom.  But before I went under contract, I had to set certain conditions for myself. 

1) Make a convincing, no-strings-attached offer.

2) Make up my mind whether or not I have the patience to wait it out for this particular home and, for how long. 

3) Make sure that all correspondence was done in writing to minimize foul play as best I could. 

4) Consistently get updates. (by far my biggest problem to-date)

By nature I'm a very competitive person, but I understand that someone has to lose in any game.  However, I don't like losing to someone that doesn't play by the rules.  Because of the nature of the processes in short sales and lack of visiblity by the buyer and their agent, it is hard to catch someone on the other side in a fraudulent act.  This is the reason I'm all for a dual tracking system.

If I lose to a better offer by the rules.........so be it.

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Permalink Reply by Jeff Payne on August 31, 2011 at 12:05pm

Richard, back to the original post about fraud, what would a dual tracking system accomplish?  If you are the buyer that is under contract, you should not be left in the dark anyway, regular updates should be given from your agent, If you were not the buyer under contract, no one would owe you any explanation. 

The problem with fraud talk is that it usually comes from someone who feels slighted or someone who didn't get the house.

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Permalink Reply by Richard on August 31, 2011 at 12:57pm

Hi Jeff,

 

I think it comes down to how back up offers are submitted and whether or not several offers are shopped simultaneously.  If a dual tracking system is used, the buyer's agent will see the progress of his/her offer file while they're under contract.  Not transcational information, just the file movement and milestones.  And, if there's no movement and someone else ends up with the home at a lower price, then an explanation is owed to the buyer and their agent. Red flag.  It's a simple an honest process.  I don't think that's too much to ask for someone who's willing to wait for a duration through the process.

 

Make no bones about it, in all my engineering and business schooling, time is money.  Time can be wasted opportunity as well.  So it does adversely affect a buyer when and if crimes are committed.  I see someone slipping in a lesser valued offer unbeknownst to the original buyer's agent or, even withholding crucial information from a lender for someone else's (third party) gain is a problem.  In the long run, it hurts everyone, especially since the price of goods and services during a crushed economy tends to get levied on everyone. Especially since the feds spends everyone's money trying to get us out if it.  And, besides a reasonable cash offer why would a lender want to settle for less.

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Permalink Reply by Smitty on August 31, 2011 at 3:12pm

Richard, let's take out the fact it's a short sale.  You make an offer on a good old regular property at the same time someone else does.  Guess what, you have NO RIGHT to know the terms of the other offer.  It has nothing to do with fraud or short sales, but because the banks are trying to do this crazy PR job about fraud and make everyone think every move is fraudulent we all become "suspicious" - Oh wait...that's a term THEY threw out.

 

Back up offers are usually never seen by the lenders until the first deal is dead.  Then the SELLER gets to chose who is next.  If you're backup, you won't see movement of a file because your offer is not being worked on.  ONE offer at a time.  If your offer is next then you should be getting updates.  I use software to track the status of a file and every time I talk to a lender, it gets updated in the system for the agents involved to see.  If someone "slips" in another offer while the first one is still active...that's a FLOP and that's clearly fraud, but you risk being sued BIG time and I don't see many agents willing to risk their licenses. 

 

The SELLER decides what to accept.  They can accept tom dick or harry... if harry has a cash offer and is a friend, they can accept it.  It doesn't matter if it's a short sale or regular sale, which is the point of the article Jeff posted. 

 

I understand your position and how frustrating the waiting game is, but it doesn't mean there is anything underhanded, fraudulent, suspicious, or shaky going on.  If you want to buy a short sale you need to be prepared to wait a bit.  It's the trade off for getting a good priced property.

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Permalink Reply by Smitty on August 31, 2011 at 3:15pm

@MSI - I'm sorry but you can't possibly be an agent.  No one stole anything.  Just because the soured agent cried robbery doesn't mean something was stolen.   Now MAYBE there was a flop here where there was a signed offer, and then a lower offer was signed after the fact.  We don't know.  the only way we'll find out is if the conviction hits the newspapers.

 

I encourage you to look up short sale fraud convictions and report back how many cases you find. 

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Permalink Reply by Richard on August 31, 2011 at 5:41pm

Hi Smitty,

 

I fully understand that a seller would want to keep the terms of their offer confidential.  I'm not asking to necessarily know the terms of the other offer, not at all.  All I am saying is the travel of the one and only file through the lender's system should be available for both parties to see.  If another file is reviewed then it should be after the first has been rejected.  I believe a true short sale buyer is only going to raise questions if the file has come to a complete halt for months on end.  However, if there is reasonable evidence to support disclosing the terms of the offer to a neutral party because because fraudulent activity or evidence is found, then I think that would be fair. 

If the lenders want to lose money, that's their choice.......not a good choice in my opinion.  But then again, that's why we're in this mess, bad choices.  I agree in a perfect world, back up offers would usually never be seen by the lenders until the first deal is dead.  However, do you really believe that happens 100% of the time?

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