Local Real Estate Comments and Ramblings

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Neighbors of mine went For Sale By Owner

I don't want to say that they are close friends but they decided to sell their house by owner.  They live in my neighborhood so they are really just neighbors.  So, their house has been sitting on the market for several months.  They called me to tell me that someone was coming by to give them a contract and wanted my advice.  I don't mind giving it, because if they can sell it on their own - more power to them.  I will be helping them buy a new home.  Anyway, this guy comes over with an offer on an old real estate form.  He wants to offer full price and then add 3% to the sales price.  He doesn't offer any earnest money or proof of loan qualification. He offers to buy as-is with no home inspection. This guy wanted to then sell it to another person(buyer) for an even higher price.  He wasn't an agent - he was an investor trying to squeeze money out of the deal.  He brought his buyer to the home to show - told my friends to take down their for sale by owner sign because "the less the buyer knew - the better".  I advised my friends to make counteroffer with at least $1000 of earnest money along with several other things.  I told them that I didn't like the situation and didn't want to be involved.  Especially since this investor person was then going to resell the property at an inflated price to someone else.   I had already done a CMA for them, so I know what the house could sell for.  They made the counter, and then never heard from the guy again.  I did research on the guy.  The corporate address that came up on his LLC search showed a residential address that is not in his name. The address on his letter head was the same as a local roofing company - not his. I wonder if this is someone to turn in to the authorities? He could be acting as an unlicensed agent, heading toward loan fraud, or who knows what else. At this point I couldn't say for sure he has done anything illegal - but it sure looks like it could have gone that way. And if so, who do I call? 

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Comment balloon 6 commentsBob Southard • July 20 2007 03:49PM

Comments

I think that I'd report him - sounds fishy to me.  But than again, on what grounds?  Just suspicion?
Posted by Kate Bourland, Onlilne Marketing Mobile Marketing (Marketing with Kate) about 11 years ago
If you can find out who he is and if he has any sort of license, call your commissioner of commerce and whatever boards he sits on.  There has got to be someone who can get that guy to stop taking advantage of people.  Yuck!!
Posted by Angie Gerhardson, Loan Officer - NMLS #274125 (LeaderOne Financial Corp. - NMLS #12007) about 11 years ago
Unfortunately this kind of stuff happens all the time. Although it is very unlikely that it would have hurt the seller directly it could have and you did the right thing. Honestly I've had my Realtors turn people in to the police and very rarely seen anything happen as a result. It is hard to say who could or would really do anything in this situation. Thanks for sharing that story though.
Posted by Jacob Morales - Arizona Mortgage Planner (US Bank) about 11 years ago
The whole thing just doesn't make sense to me.  I don't see how the the new buyer would be able to obtain financing for the house if it had just sold for a lesser price.  The buyers appraiser would certainly be able to see the recording and the price.  I'd run from anything like that and advise the neighbor to too.
Posted by Tony D. Howell (The best place EVER!) about 11 years ago
Bob, is there not a registry of all licensed real estate professional in your state? If he's not on the registry then i would report him and let the authorities deal with it.
Posted by Wayne McMullan, Quinte Real Estate (Royal LePage ProAlliance Realty) about 11 years ago

I figured he was trying to do some sort of assignment.  Just structured really badly.  One of the things the seller asked in the counter offer was that any fees paid MUST be disclosed on the HUD1 closing statement.  Ultimately, it seems the buyer just wouldn't put up any earnest money.  His comment "$1000 - that's ubsurd maybe I will put up $100 but no more"

 

Posted by Bob Southard, e-Pro - Cobb, Cherokee, North Fulton (Atlas Realty Service, LLC) about 11 years ago

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