Recently I was made aware of a past client who decided to purchase new construction in St. Elsewhere.
Without going into the boring details it came down to the fact he was $40,000 short. He was told to get a family member or friend to open up an account with $40,000 and add his name to it. Keep the money there for about 3 months and then take his name off or close the account.
This, today, with all of the foreclosures, short sales going on is happening as we speak. You would think, that common sense would tell one, you are over your head, you cannot afford it.....but No, his agent told him that they have attorneys in their office and this is perfectly legal.
I wonder if that agent and his attorneys would sign a deposition stating they were totally aware of this and counseled him to proceed and will guarantee the loan if an audit or default was to occur?
Whether or not this past client proceeded, I do not know. I can only hope he came to his senses. His loan apparently was a mirror image of present one to which he was vehemently warned about to pay on principal and to re finance out of. His buddies who bought homes told him this was the way to go and to get into home ownership.
It has been the creative financing that has been a downfall for many. I lost a lot of clients as I refused to partake in the creative financing. At least I can sleep at nite knowing that Joe or Sally was not on the street because of my greed to close escrow.
It just boggles me that fraud is still so rampant with the authorities closing in and doing audits etc. You would think these idiots would go away for awhile. I guess that is why they are idiots.......
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Terry, it always just baffles me, the short sightedness of those that would do this to themselves anyway.. if they "need" that money, why lie about it... it will catch up to them. Its like lying on the app that you make 10k a month as a busboy for TGIFridays (restaurant). . . hello, your lies aren't going to help you pay that mortgage. It is sad what people are willing to do, and sadder yet that "professionals" are willing to help them .