Posed as a Mortgage company - Posted by John Behle
Posted by John Behle on January 04, 1999 at 14:33:23:
Probably should have added more details. They purchased the properties low down assumption (subject to). To justify why they were in a rush and needed to sell quickly - they said they had acquired the properties by foreclosure - to the listing agent.
Then they sold for a low down on a contract what appeared to be a free and clear property. They sold the paper, made payments for a couple months - to be able to consumate enough deals, then took the money and it all collapsed.
Anyone checking the title that knew their “story” would have seen that it had not been foreclosed or even in default and that it was not titled in a mortgage company. Not really all that sophisticated, but illustrates the need for title insurance and the value of being able to pull your own abstract to avoid wasting time, money and effort.
We had another that claimed the property was free and clear. I was trading notes for the property and had initiated a mortgage loan, paid for an appraisal and even sent a crew to begin fixing the property up.
When I checked the title, I found it wasn’t free and clear, but had two mortgages 100%+ LTV and was two weeks from sale. There’s no way they could have pulled off the scam, but they wasted my time and money - and taught me a lesson, that I always follow and few others do. Spend a few minutes, pull an “abstract” and know what you are dealing with. It saves many deals and steers me away from a lot of time wasting transactions.