Reverse Success Story - Posted by rick m

Posted by jason on May 08, 2006 at 13:37:51:

haha, im so dumb…you’d still only have 20k in it, plus holding costs (ins and tax)

Reverse Success Story - Posted by rick m

Posted by rick m on May 07, 2006 at 19:09:01:

Today I am going to pat myself on the back a bit; I hope you will all ablidge.

Today is the day that foreclosures that have been filed for the prior week are posted on the internet in my county and it is my day off from my day job. I print them all out and visit each of them in hopes of finding a good deal.

I found a deal that is beyond incredible. An elderly woman whose husband had passed earlier was in foreclosure. When I asked her how much her payment was she said $400. I managed to not even fall out of the chair when she told me too!

Here’s where the story takes a turn.

This would have been my first deal, I have been working my butt off to find it and I will, but not this one. I tried to explain to her what I could do for her but she did not understand a thing I was saying. It appears that her husband handled all the business affairs of the family. Add on to that, she is caring for her mentally challenged niece who lives with her.

I was able to determine that she had a daughter in NJ and a son in NJ but she didn’t have a clue what was wrong. I told her I found her in the public record and they were about to foreclose on her house and I was there to help her if I could. She began crying and told me she had prayed and God must have sent me.

She wanted to keep her house and she should be able to. She thought that the bank was paying the mortgage automatically like her utilities got paid and claimed to have no idea that mortgage was behind.

The investor in me said JUMP at this! She said she purchased the house 18 years ago for $45K and it was in spit spot shape today and worth at least $200K. I came home and researched the loan and it appears to only have about $18K due on it! They are foreclosing for $18K! By the time I left there she completely trusted me, I can have this house for the balance of the loan if I were to rent it back to her.

I, instead, just called her and got her daughter’s phone number. I left her daughter a message that if she didn’t deal w/ the situation down here somebody was going to take advantage of her mother in a big way. I couldn’t bring myself to do it.

I have no problem purchasing a house from somebody at a substantial discount when they are ready, willing and able to understand the agreement, but this lady has no clue and somebody needs to help her. When the daughter calls back I am going to offer to help them if I can, maybe I will charge a small consulting fee or something, but certainly, they need to get this issue taken care of.

The other thing I noticed when I was there were piles and piles and piles of mail everywhere! Stacks of it! She had not opened mail in forever it appeared. This woman needs help; she seemed a sweet person that said “please can you help me, please”. I may be completely wrong on this, I am an excellent judge of character and am in sales for my day job so I read people like a book usually, but this one I have a gut that I am doing the right thing.

I hope that I am right about this and she will be made whole again. A simple refinance or reverse equity would do the trick but she is clueless. I hope that no other investor will get in and take advantage of her before I can help her out.

Maybe, God did send me there.

Re: Reverse Success Story - Posted by michaela-ATL

Posted by michaela-ATL on May 08, 2006 at 07:47:55:

I had a property several years ago where I dealt with the owner for 2 years. ALways stopped when I saw her outside. Talked to her and gain somewhat of a trust. She had a little dimentia, but was extremely headstrong. Every investor had been trying to buy her house, but she wouldn’t go for it. Her 2500sqf craftsman was full of collected clothes from top to
10’ ceiling. The city had been fighting with her, because of the fire hazard. They were ready to put her in jail. I finally got her daughter’s ph# out of her in Ohio. I called her and she had no idea about her mother’s situation. She drove down with her husband and children. TRhey ended up convincing her mother ot sell the house to me.

You just never know how things mayh come out in your favor when money is not your first objective.

Good luck


Why don’t you contact the city … - Posted by DTom

Posted by DTom on May 08, 2006 at 03:18:02:

Why don’t you contact the city or any other institution which deals with elderly in such situations?
There is God and there is Karma. The saying “What goes around comes around” is 100% True. Never ever take advantage of sick and old people. (This should be aplied to all people btw.)

Good Luck!

Re: Reverse Success Story - Posted by vk60546

Posted by vk60546 on May 07, 2006 at 20:35:45:

I also commend you for your unwillingness to take advantage of this distressed seller.

However, like Phil Fernandez said (below), the lady will loose the house if things continue as they are. And then what?

What is her financial situation like? Can she afford $400/mo? If not, what is her strategy?

If so, then you can call the bank and explain the situation to them, see if they would be willing to roll the arrears on the back of the loan.

You won’t get paid, but you never know, perhaps they will be a good referral for you or something…

Lastly, if the house is worth 45K and the loan balance is 18K, perhaps you could try buying it at 30-35K? That way it is a win-win. The seller gets a good chunk of her equity and you make money as well…

Re: Reverse Success Story - Posted by phil fernandez

Posted by phil fernandez on May 07, 2006 at 19:33:30:


If you don’t step in, she may lose the house. You don’t want to take advantage of this lady, then how about trying to buy the mortgage from the bank before they foreclose and let her make monthly payments to you. Or buy the house and rent it back to her cheap for the next 5 years. Or do a reverse mortgage yourself. There are many ways to help this woman and at the same time make money for yourself. It’s okay to profit in this business. You are a problem solver and should get paid for that.

By just calling the daughter, I bet you don’t even get a thank you. Now this might all sound harsh, but the main idea is to solve problems and get compensated for it.

Just my take.

Re: Reverse Success Story - Posted by michaela-ATL

Posted by michaela-ATL on May 07, 2006 at 19:24:20:


I applaud you for your actions. Life’s not all about money. I believe in Karma and that things will come back to you - usually not in a tangible form, that you can connect wirh trhe previous actions.

If you had taken advantage of her it would have backfired somewhere else. The fact,
that you helped her instead will also come back to you.

Good going


Re: Reverse Success Story - Posted by rick m

Posted by rick m on May 08, 2006 at 23:43:57:

I am hoping my story turns out much the same.

Re: Why don’t you contact the city … - Posted by rick m

Posted by rick m on May 08, 2006 at 23:44:46:

I am meeting w/ the daughter on Wednesday.

Re: Reverse Success Story - Posted by rick m

Posted by rick m on May 07, 2006 at 21:00:19:

I know she will lose the house and I am prepared to help her and her family. I wouldn’t let them lose the house, I would step in then. She told me her daughter was coming down and Tuesday and I wanted to deal w/ her.

Her daughter did call me today and said she has dimensia, so any contract would have lead to mass legal procedings that I didn’t need. I am meeting w/ her and her daughter on Wednesday at which time we will formulate a plan. I hope to be part of that plan, but maybe not. Either way I know I did right by her and in my heart.

The house is actually worth between $175-$200. If it were only worth $45 I would have had it signed up today, without question, that would not have been unreasonable.

She was willing to do anything I wanted her to do. She probably would have signed over full power of attorney to me on the spot. That is just flat out wrong in my opinion. It is one thing to take advantage of a situation, it is another to take full advantage of a mentally ill senior citizen.

Re: Reverse Success Story - Posted by rick m

Posted by rick m on May 07, 2006 at 21:06:53:

The reason to call the daughter so quickly was to let her know that her mother was ripe for scam artists. I wanted to establish good faith and credibility w/ the family and let them know that I was here to help, not take advantage of them.

While I may, in fact, not even get a thank you, I did get a call today from the daughter that included many heartfelt thank you’s. She is coming to town on Tuesday and we are meeting on Wednesday to formulate a plan.

I will hopefully be part of that plan and appreciate the great ideas! I will be looking at many creative options to get them out of this. She also owns another property she has rented across town and wants to sell. I may buy that one and assist w/ funding on this one. Who knows? The possibilites are endless.

I am definately in this as a problem solver and for profit and am not affraid to profit from an unfortunate situation, but I will not profit from a lady with dimensia without the concent of someone that loves her and cares about her situation.

Re: Reverse Success Story - Posted by Kevin - WA

Posted by Kevin - WA on May 07, 2006 at 20:38:08:


I applaude your position and integrity. I also think that Phil has a point, and there is a good middle ground here.

You should not necessarily just “walk away,” as this is business. But on the other hand, you don’t want to “take advantage” because as Michaela said, that will bite you.

Case in point, I just got a case dismissed on Thursday. The short story is that this guy bought a house, and the previous owners wanted to rent it back for a brief time while they transitioned and moved out. Long story short, they never left, never paid rent, and the new owner deeded the house to my company because he could not afford the payments on a house he didn’t live in. So, the previous owner sued me and the new owner, saying that “he didn’t know that signing the deed and cashing the check constituted a change in ownership.” Ludicrous, I know - but it took a year of my life to resolve and just got dismissed on Thursday.

My point is that if you were to just “take” this house and the equity, her relatives are going to sue you and claim diminished capacity. Based on your description, they might win. So, you want to definitely be able to show you are “helping” her and not just helping yourself. And talk to an attorney about how to cover yourself in case it goes bad. Remember, someone is probably counting on this house as their “inheritance,” and although they seem to not be too involved in her affairs, they will get interested when money is involved.

Good luck,


Thank you - Posted by rick m

Posted by rick m on May 07, 2006 at 21:13:50:

Thank you! I will try to still stay active in their situation, but I couldn’t do it to this poor old lady.

Re: Reverse Success Story - Posted by Eddie Fl

Posted by Eddie Fl on May 08, 2006 at 10:06:31:

My hat goes off to you. You have done the right thing.

That’s what I was thinking - Posted by rick m

Posted by rick m on May 07, 2006 at 21:12:50:

That was my thinking also. Establish myself w/ the entire family as the point of contact in town that wants to help them. This is the truth. Then formulate a plan that is best for all.

As I sat there w/ her today and she begged me, “please just help me, please just help me,” it was obvious that all circuits were not clicking. I talked to the daughter this evening and she has dimensia. She is coming down Tuesday and we are meeting Wednesday. Apparently another investor has taken all her stuff and is trying to get her to sign over full power of attorney.

I agree, that I stand a good chance of losing any law suit brought by the family and that’s where my soul searching got me to today. In the families eyes, the other lady is a shark (right or wrong) and I am a savior. I should be able to position myself as such and help them solve all their problems.

Re: Reverse Success Story - Posted by rick m

Posted by rick m on May 08, 2006 at 23:45:28:

thank you!

Re: That’s what I was thinking - Posted by jason

Posted by jason on May 08, 2006 at 13:37:10:

I’d work out a deal that allows her to live rent free til death…maybe. How old is she? Maybe no rent for say, 15 years. That would save her 5k/yr…15 yrs is 75k. Pay off the mortgage for 20k, and you have 100k in a 200 k property.

Re: That’s what I was thinking - Posted by rick m

Posted by rick m on May 08, 2006 at 23:47:10:

This is my strategy of last resort. I would prefer to get some cash out immediately. I figure worst case it would be a great property for a HELOC to buy more.