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Happy Wednesday Blogosphere!
So, I don’t actually have confirmation yet, but it looks like the deal I am working on with my buddy is in a little bit of trouble. He got an email from the title company yesterday afternoon saying that there is a mortgage still attached to the property. SWEET!!!!
It’s kind of funny, actually (in a non-funny sort of way), because I was just talking to a wholesaler friend of mine over the weekend, and he was telling me about an REO deal that just blew up in his face. Apparently, the law firm who handled the foreclosure forgot to foreclose on one of the loans and so they had to go back and start all over again. He was supposed to make 18k on the deal (Cha-Ching!), and it just went up in smoke right before his very eyes. Awesome.
Anyway, the non-funny part is that after he told me the story I said how surprised I was that I’ve never had that happen to me, and then right after the words popped out of my mouth, I mentioned that I should probably shut my big fat trap before I jinxed myself. Hahahaha.
So anywho, like I said, we don’t know for sure what’s going on yet, but should find out more today. We did however, do some investigating online last night, and it appears that there were some serious shenanigans going on (as opposed to the non-serious variety) when this property was purchased. This house is in the quasi-hood (right on the outskirts of the hood), and the previous owner somehow managed to take out $227,872.05 in loans on the property, even though the purchase price was $83,500. Holy mortgage fraud, Batman!
Hopefully she spent the excess funds on something nice. Like a plasma TV or a big-ass, gas-guzzling SUV. Or something else that ends with a V…
Alrighty then, gotta run.
10-4, over and out.
P.S.
Red dot count = 11!
Woohoo!
P.P.S.
Flip This REO! eBooks make great Christmas gifts…
Click here to grab yourself a copy!
Hohoho. 
On December 09, 2009 at 7:44am, Shae said...
Yikes…Holy mortgage fraud is right! Well let’s hope it works out and in the meantime I’m sure you’ll get two other deals under wraps. Go girl!
.-= Shae´s last blog ..Holiday Marketing Tips and Other Updates =-.
On December 09, 2009 at 7:48am, Stephani said...
Thanks, Shae.
Hopefully it’s something that can be easily (and quickly) fixed. We shall see…
Have a great day!
On December 09, 2009 at 7:01pm, Michael said...
Don’t read many REI blogs, but I stop by yours a couple times a week. I enjoy your personality and admire your great work ethic! Keep on hustlin’!
On December 09, 2009 at 8:33pm, Stephani said...
Why thank you, Michael. Much appreciated!
On December 10, 2009 at 6:52pm, Julie Broad said...
That is totally unbelievable. You just don’t hear such mortgage stories in Canada… EVER! How does it get to that point?? I don’t totally understand how you could have nearly 3x’s the home value in mortgages.
Anyway – LOVE that you keep sharing the oh so real and not always rich side of wholesaling. Always entertaining and definitely informative.
.-= Julie Broad´s last blog ..A Small Tribute to the SPCA Biscuit Fund and Cindy Schafer =-.
On December 10, 2009 at 7:12pm, Stephani said...
Hi Julie,
This kind of fraud was pretty much the norm a few years ago (in Tampa anyway). People pulling out loads of cash after getting juiced up appraisals, and then just walking away.
Crazy.
Thanks for stopping by.
On December 11, 2009 at 12:27am, Alex said...
I am amazing at the amount of properties that I find were there is blatant mortgage fraud…
For an example their was one house I looked in in which the owner took out $1,800,000 in loans (way over the value even at the peak) at then the house sold as a REO for $400,000! Crazy!
On December 11, 2009 at 3:00pm, Tiara said...
Hey Steph, this question is totally unrelated to this particular post but I was wondering about how you deal with competition? It seems like Tampa, FL is the mecca of all things real estate these days. Its like every “guru” and coach hawking their program is based in Tampa? Is Tampa’s market that bad (good for investors lol)? Being that you specialize in REO flips, do you see most investors down there as your competition, or just guys that you wholesale to? If flipping REOs are this simple, then why is everybody jumping on the Short Sale bandwagon instead of flipping REOs like you? It would seem like making a few grand for a few hours of work would seem more appealing.
P.S Here in Detroit, there are a bunch of investors selling to foreign Buy and Hold investors trying to find deals like the $100 house that Im sure you guys seen on CNN. I most definitely have to get in now before there is nothing left for me to get into, there is a bunch of competition here.
P.P.S Others can chime in on how you deal with competition in your particular market.
On December 11, 2009 at 4:08pm, Stephani said...
Hi Tiara,
There are a ton of wholesalers going after REOs here, but I don’t see them as my competition at all. Most of the deals I do are joint ventures with other wholesalers, so I look at them more as part of my team as opposed to my competition. The more the merrier.
I don’t mean to give the impression that flipping REOs is simple. I was able to make a few grand for a few hours of work on this deal because I have spent the last few years busting my ass- building relationships with other wholesalers, and building a kick butt buyers list.
There is plenty of money to made with short sales as well, but just like with REOs you have to be willing to put in the work and hustle before you start cashing checks. Anyone who tells you otherwise is full of shit. Either that or they’re trying to sell you something.
Steph
On December 12, 2009 at 8:50am, Dennis said...
Damn, 250k on a 83k mortgage was siphoned out!? Crazy.. and we wonder why we’re in this mess now. Steph, I’m glad to see you’re still rockin down there in Tampa!
On December 12, 2009 at 8:53am, Stephani said...
Hey Dennis! I thought you fell off the face of the Earth. How’s everything going?
On December 14, 2009 at 9:46am, Dennis said...
Hey Steph!! Nope, I’m still around just not so much REI right now :’(. Everything is going well though! I’m still about business!… and work lol
On December 14, 2009 at 10:23am, Stephani said...
Cool- glad to hear you are doing well, Dennis. Happy Holidays to you and yours.