Investor Giving Me Tons Of Work

[Kate]

I assume you are disclosing and describing in detail these prior transfers of ownership in your reports?

Now that I know I have to do. It was the listing after the effective date that was bugging me. Oh well.

 

[Dee Dee]

So what are these multiple sales from investors that your investor is buying with unusual financing arrangements? Are they foreclosures or what?
Never heard of anything like it before.

 

[Ghost Rider]

Originally posted by Kate@Jul 7 2004, 05:58 PM
I assume you are disclosing and describing in detail these prior transfers of ownership in your reports?

Now that I know I have to do. It was the listing after the effective date that was bugging me. Oh well.

I'm gonna work on getting out of this thread, cause there are way too many things that are scaring the heck out of me.....

Kate, does the post I quoted mean that you didn't know you were supposed to be disclosing and analyzing the prior transfers of the subject property?? As in, the borrower bought the place for $30,000, you appraised it @ $100,000 for his refi, and you didn't get into the fact that he bought the place for $30,000 in the report??

Maybe I'm not understanding what you are saying with the "now that I know I have to" statement.

For the record, you are REQUIRED to diclose a 3 year history of the property in the report. And thats ALL transfers, regardless of if they are arms length sales, or if they are transfers between family members, or foreclosures, or non-arms length foreclosure sales. No exceptions. If you haven't been doing this - Start now, and be very hopeful whomever reviews these reports is dumb as a rock, cause thats a MAJOR no-no.

 

[Kate]

No! I was replying to DeeDee. I said now that I know I have to do. Sometimes righting doesn't come out the way you would say it. Not now as in right now I know I have to do that. I meant as in now that.(pause)......I know i have to do. see the difference.

That is USPAP 101. I know all about disclosing proir sales. The amount the date the book and page if it was a distressed sale yada yada.

 

[Mountain Man]

So what are these multiple sales from investors that your investor is buying with unusual financing arrangements? Are they foreclosures or what?

I'm coming in on the tail end of this, and don't have time to read through, but multiple investor sales on one property would through sooo many red flags, that I would not want to touch the deal. Now with that being said, we buy from and sell to fellow investors on occassion. I've seen those deals done with "No Doc" loans. Those are loans where they really lend on the individual, not the real estate. They are usually short term, very high interest rate, and the investor has to flip the property within a year or two to make any money. We don't use those types of loans in our investing. It's either cash, or other more conventional lending means. Flipping using No Doc. loans is built on the "volume" business principle.... and that is too risky for me.

 

[Kate]

Originally posted by Dee Dee@Jul 7 2004, 06:06 PM
So what are these multiple sales from investors that your investor is buying with unusual financing arrangements? Are they foreclosures or what?
Never heard of anything like it before.

Some are forclosures some aren't. I counted three. Multiple sales as in he is buying a lot not as in selling the same house over and over.

 

[Dee Dee]

Guess I'm wondering why these investors would sell to another investor and leave any room for profit, unless the guy you work with has been taking the time to fix them up and getting some sweat equity out of it. Seems he's turning them awfully fast to have much time to do that.

 

[Kate]

He is not selling all of them, just one. He is buying these four properties from another one owner. I don't know why the owner is selling but I do know they were a package deel. The owner wants out and made a deal to sell all of his properties at once at a slightly reduced price IF the investor bought them all. One of them he apparently doesn't want, thus the listing that started this thread. The rest of them are single family rentals that he intends on keeping as rentals.

 

[Dee Dee]

Got it. So there are individual sales contracts for each property, even though he gave group pricing?

Guess it was when you said that this investor flips a lot of properties that made me wonder what he was up to, as well as why he'd try to refi right after buying them. It smacks of risky 'on the edge' investment tactics, especially since he approached you as if this is a make or break deal if you disclosed about about the listing attempts. A person could make a lot of quick money by doing a high LTV cash-out refi, then just walking away if they can't sell or lease out the property. Add an appraiser who turns their head, doesn't disclose pertinent information or is willing to push the value, and it becomes even more lucrative.
Just trying to keep you out of trouble Kate. You've already made a few sizable boo-boo's with this investor that your supervisor should have caught.

 

[Kate]

This is why I love ya Dee Dee you keep me on my toes that is for sure. I need to clear this up though.

Got it. So there are individual sales contracts for each property, even though he gave group pricing?

Yes, there are individual P&S on each but they were all one deal.

Guess it was when you said that this investor flips a lot of properties that made me wonder what he was up to, as well as why he'd try to refi right after buying them.

As I understand it he uses a type of loan that as I said is no questions asked at a high rate, I do not believe he even does an appraisal for these. Then he refis to get a better rate once he decides what he wants to do with them. Some he keeps as rentals, some he gets as distressed sales and makes repairs and sells, some he keeps and does major renovations and then sells or rents.

It smacks of risky 'on the edge' investment tactics, especially since he approached you as if this is a make or break deal if you disclosed about about the listing attempts.

Yes that is why I asked. He did this b/c of the one property about two months ago that he thought he wanted to list but changed his mind and decided to refi. I mentioned this fact in the report and the underwriters don't like that he did that and the loan still hasn't gone through because I did disclose everything. He called to ask me not to mention this new one being listed. That was the problem I was having that has been solved at this point. As for why he contacts me first, don't know, don't like it, and have to do something about that.

Just trying to keep you out of trouble Kate. You've already made a few sizable boo-boo's with this investor that your supervisor should have caught.

Let me see if I can guess the sizable mistakes.

I allowed him to contact me before he contacted the LO. Yes that needs to be taken care of.

But, Dee Dee what else did I do? I disclosed everything. I researched everything. Please tell me what else I did that was so sizable.