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Investors that leave a sour taste in your mouth

By
Real Estate Agent with Majestic Properties 3061802

I've been debating whether to post this or not and finally decided to go for it to get your opinions. 

I would like to set the tone for this story about a Real Estate Investor who I will call JAKE.  Jake purchased onereal estate snake of our listings before.  He called without an agent, claimed he did not have one, we showed him the property, gave him comps, and did other due diligence.

Several weeks later, we received an offer for that property from Jake's real estate agent.  Although felt somewhat disturbed by Jake's ways, we decided to try to negotiate the best deal possible for our seller.  The offer had the typical seller's contributions, money back at closing and other manipulating schemes typical of this market.  We cleaned up the offer according to Fannie Mae guidelines, countered and we were able to achieve a sale.  Jake's agent did not do a thing; we had to do our job and his job.  Jake insisted in talking directly with us, the agent did not return one single call during the whole transaction.  Did not show up to appraisal, inspections or even the closing. But our seller got what he wanted at the time agreed, after many headaches and close calls.  We had to jump hurdles and were so happy when it was all done.

So a couple of months go by and I receive a call form Jake.  "Hey Ines, I see you have a listing I may be interested in, could you please send me the information via e-mail?"

I took a big breath, sent him an e-mail and asked sarcastically, "So I can assume you are not working with an agent this time either?"  Here's Jake's response (unedited):

Ines, yes i am working with a realtor however if you know how to structure this adendom and sales contract i will be glad to work with you. I would like to offer 500k with 3% sellers contribution back to buyer. I also want an adendom saying buyer would like to get back 70K at closing for repairs. i will put down 1,000.00 deposit and 49,000.00 15 days after excepted. I will give you a pre aproved letter with contract and a commitment letter with deposit and will close before July 25th. The total offer after money back is going tobe 415,000.00 less your double dip....

What do you think?  Please remember that in Florida we are transaction Brokers which is "a broker who provides limited representation to a buyer, a seller, or both in a real estate transaction, but does not represent either in a fiduciary capacity or as a single agent".

Comments(85)

Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans
Don't you see me right now?  It's me in a snow storm.        
Jun 27, 2007 03:48 PM
Christy Powers
Keller Williams Coastal Area Partners - Pooler, GA
Pooler, Savannah Real Estate Agent

He sounds like a piece of work. If you decide to work with him, I would be careful and double check everything!

Jun 27, 2007 03:59 PM
William Johnson
Retired - La Jolla, CA
Retired
There is an attorney that handles the close-right? The deal won't fly. If It is made to fly, then someone is pulling strings somewhere. be very weary. I personally wouldn't even consider working for them I would distance myself from that transaction. In any case the attorney involved would be the one owing a fiduciary? The lender won't approve it as the underwriting guidelines allow for on  6% contribution from the seller. The seller could do some of the remodel but that proabbly is not what he is really looking for.
Jun 27, 2007 07:50 PM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL

Jeff - LOL!

Christy - THAT, he is.

William - we would recommend for the seller to get an attorney, we would not work or represent the buyer in any way.  When I talked about intent it was to see if negotiating the price down of the house would be a possibility plus a 3% not a 6% seller contribution - once we know his intent, then we can see what our seller is willing to do.  (but again....not $85K worth).  You do have to be very careful with people like this, and we document every single step of the way, so we don't get dragged down into his pit.

Jun 28, 2007 01:24 AM
Tchaka Owen
Galleria International Realty - Hollywood, FL

Hi Ines - what do I think?  I think Jake is a snide little trick...and that's only because I can't say what I really want to say given that this is AR.  After all the work you did the first time around where you DESERVED to be paid on both sides he has the nerve to mention a double-dip.  I have a feeling that the other agent had to fork over a portion of the commissions under the table too.

Have him sign a transaction broker agreement before you do anything for him.  If he doesn't, have him find his own agent and do your share of the transaction and not the entire enchilada.

And as others have mentioned, there appears to be some sort of fraud going on.  Perhaps you should complete the transaction along with the local FBI.  :-) 

 

 

 

Jun 28, 2007 01:27 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL

Tchaka - there should be a system where you could flag individuals like Jake for some police institution to investigate him and keep an eye out.  As soon as we told him to have an agent write it up because we would not be party to an illegal offer, he got nervous, said he didn't know it was illegal, tried to point fingers, and told us to forget the whole thing.

I know he will do it again, I know someone will fall for it, it would be great for him to get caught. 

Jun 28, 2007 01:45 AM
Tchaka Owen
Galleria International Realty - Hollywood, FL

I am willing to bet he knows it's illegal.  :-)

I was told to call the local FBI whenever I suspect fraud in the works and let them decide what to do.  Although you're not getting the business now, I at least feel good that you don't have to deal with such a jerk.  Hopefully there will be a better mannered and more ethical client around the corner.

- Tchaka 

Jun 28, 2007 02:09 AM
Ryan Hukill - Edmond
405home @ ERA Courtyard - Edmond, OK
Realtor, Team Lead
Looks like everything that I would have said has already been said, so I'll just say "RUN." Run as fast as you can from this one.
Jun 28, 2007 02:21 AM
Sami Forrest
Eco-Steward Realty - Asheville, NC

Inez

I was a member of a real estate investor's association for a few years. The organization had numerous educational seminars on a regular basis purporting to coach or instruct you in helping property owners by purchasing their 'problem' properties. Admittedly I was a slow learner because it took me 2 years to grasp the agenda of the organization. Once I understood how the 'system' worked in training individuals to become 'investors' I decided that their system was not how I wanted to conduct myself. Unfortunately there are people who prefer not to operate honestly and fairly. It's better when we choose not to deal with them.

I am reminded of that old adage:

"The only thing worse for a landlord than no tenant is a bad tenant. Same could be said about clients.

Jun 28, 2007 06:32 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL

Tchaka - it's funny you mention calling the FBI, because when you do, they ask, has it already happened?  when you respond "no", they are not interested.  Maybe someone knows who to call and how to go about it.

Funny thing is that we have received at least 10 calls for that listing alone today!  This guy might have brought the house some luck.

Ryan - we're running....literally.....as I type.   : )

Sami - I totally agree it's like that saying "better alone than in bad company" - same concept.  It's sad to think about all these organizations teaching people the wrong and sometimes illegal strategies to do business.

Jun 28, 2007 10:31 AM
Celeste "SALLY" Cheeseman
Liberty Homes - Mililani, HI
(RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE
I was talking to another agent in my office yesterday and she said she got a pre whatever (didn't state anything but "preliminary" loan letter) and it was signed by a "real estate loan advisor". Have you ever heard of that? And the buyer is a real estate salesperson who also works for this ABC company and we're assuming investing...(vacant land) and underbid by 40k. Oh...and he didn't submit this letter with the offer...she had to chase him down and tell him to get one.
Jun 29, 2007 04:04 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL
Sally - that's pretty funny.....I'm sorry I'm laughing, but that's smells a little weird to me.  Ask him for a real pre-approval letter - what are people thinking?
Jun 29, 2007 04:13 AM
Celeste "SALLY" Cheeseman
Liberty Homes - Mililani, HI
(RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE
Ines: No kidding!  I actually saw the letter and I was laughing....we both were laughing. Especially the "real estate loan advisor"  ....now just what the heck is that?
Jun 29, 2007 05:00 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL
Sally - LOL!!  If it was all about titles, I could come up with some really creative ones too!
Jun 29, 2007 05:49 AM
Katrina Madewell
Charles Rutenberg Rlty- More than 5,000 agents(813) 777-1196 - Tampa, FL
Tampa FL Homes for sale | Tampa Bay - (813) 777-1196
  You did the right thing... don't let a snake in the grass get you down!
Jun 30, 2007 01:13 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL
Katrina - thanks for the love but they don't get us down, they make our world more exciting and we realize what surrounds us - thanks for the good wishes!
Jun 30, 2007 02:38 AM
Tchaka Owen
Galleria International Realty - Hollywood, FL

Ines - check out today's Miami Herald.  There's an article on a couple that used straw buyers in a sheme who now have a number of homes in foreclosure (front page).  In regards to the authorities, here's an excerpt from the article: The FBI said it is not investigating the complaint because it has only two agents in its Miami field office working on mortgage fraud.

Wow!

As big an issue as mortgage fraud is in the area and as blatant as this case is, the FBI only has 2 people?

- Tchaka 

 

Jul 01, 2007 02:04 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL
Tchaka - that's unbelievable - I'll take a look at the Herald. (but it doesn't surprise me).  Why are we one of the largest Mortgage Fraud cities?  because people don't get caught and there are no consequences....that's just WRONG!
Jul 01, 2007 02:41 AM
Armando Rodriguez
QUEST REALTY SERVICES - Orlando, FL
Orlando Homes 4 Sale, Real Estate Broker-GRI
Very Shady... I'd stay away from this guy. I wouldn't want anything to rub off on me. It shouldn't be all about money.
Jul 03, 2007 11:05 AM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL
Armando - as soon as we told him to have another agent draft up an offer because we would not be part of anything illegal, he totally freaked out and disappeared.
Jul 03, 2007 01:15 PM