- This topic has 30 replies, 7 voices, and was last updated 17 years, 5 months ago by
no_such_reality.
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June 20, 2007 at 3:40 PM #9346June 20, 2007 at 10:55 PM #60910
sdrealtor
ParticipantI’ve seen a couple of those also and didnt understand what was going on either. Thanks for the information.
June 20, 2007 at 10:55 PM #60946ParticipantI’ve seen a couple of those also and didnt understand what was going on either. Thanks for the information.
June 20, 2007 at 11:15 PM #60912rankandfile
ParticipantThanks for shedding light on the problem. What are the potential work around(s), if any?
June 20, 2007 at 11:15 PM #60948ParticipantThanks for shedding light on the problem. What are the potential work around(s), if any?
June 21, 2007 at 7:34 AM #60935SD Realtor
ParticipantRankandfile the lender will first file a relief from stay but it has to be done at the county court where the bankruptcy is filed. If the seller keeps playing the shell game then the lender can then file for the IM REM. To me, and again I don’t know this to well, the IM REM will effectively disabled the asset protection process that the bankruptcy protection provides. Again, the IM REM will need to be filed in the same county court as the bankruptcy was done at.
I do not know what happens if another shell company is formed but then they claim bankruptcy in yet another county. My impression is that the IM REM will protect the asset and enable the lender to move forward.
sdr – Yeah I had seen these odd title transfers here and there. I would look at the grant deeds and see partial interests for a really low price to wierd named holding companies and never knew what the heck was going on. I even asked my title officer and his answer was sketchy but he referred me to an associate of his and she nailed it in a matter of like 5 minutes. She went to county records in surrounding counties and found the bankruptcy filings of the companies that were granted the partial interests and explained it to me.
SD Realtor
June 21, 2007 at 7:34 AM #60972ParticipantRankandfile the lender will first file a relief from stay but it has to be done at the county court where the bankruptcy is filed. If the seller keeps playing the shell game then the lender can then file for the IM REM. To me, and again I don’t know this to well, the IM REM will effectively disabled the asset protection process that the bankruptcy protection provides. Again, the IM REM will need to be filed in the same county court as the bankruptcy was done at.
I do not know what happens if another shell company is formed but then they claim bankruptcy in yet another county. My impression is that the IM REM will protect the asset and enable the lender to move forward.
sdr – Yeah I had seen these odd title transfers here and there. I would look at the grant deeds and see partial interests for a really low price to wierd named holding companies and never knew what the heck was going on. I even asked my title officer and his answer was sketchy but he referred me to an associate of his and she nailed it in a matter of like 5 minutes. She went to county records in surrounding counties and found the bankruptcy filings of the companies that were granted the partial interests and explained it to me.
SD Realtor
June 21, 2007 at 9:08 AM #60957no_such_reality
ParticipantSo in a nutshell, fraud.
They are transferring a partial interest at far below market value to a shell corporation that then declares bankruptcy to prevent due process of the default allowing them to continue skipping payments.
June 21, 2007 at 9:08 AM #60994ParticipantSo in a nutshell, fraud.
They are transferring a partial interest at far below market value to a shell corporation that then declares bankruptcy to prevent due process of the default allowing them to continue skipping payments.
June 21, 2007 at 9:13 AM #60959ParticipantThe case I know of has been trying to sell his $2M house in Encinitas Ranch for a couple years. I think he’s trying to buy more time to find a GF. He’s probably been neg aming for quite some time.
June 21, 2007 at 9:13 AM #60996ParticipantThe case I know of has been trying to sell his $2M house in Encinitas Ranch for a couple years. I think he’s trying to buy more time to find a GF. He’s probably been neg aming for quite some time.
June 21, 2007 at 9:19 AM #60963PerryChase
ParticipantSD Realtor, this is interesting indeed because it show that this homeowner was a business man of above average means. He fell on hard times but still has access to lawyers.
I think we’ll see a lot of small businesses failing and foreclosures in the “superior” areas. San Diego has plenty of businesses up to 50 employees and those businesses will be in precarious positions when the easy money runs out. Don’t be surprised when they go bankrupt. You heard it here first.
June 21, 2007 at 9:19 AM #61000ParticipantSD Realtor, this is interesting indeed because it show that this homeowner was a business man of above average means. He fell on hard times but still has access to lawyers.
I think we’ll see a lot of small businesses failing and foreclosures in the “superior” areas. San Diego has plenty of businesses up to 50 employees and those businesses will be in precarious positions when the easy money runs out. Don’t be surprised when they go bankrupt. You heard it here first.
June 21, 2007 at 9:32 AM #60971ParticipantYes this is in a nutshell fraud, (IMO but I am not a lawyer)… Please note, it does seem to me that this can be applied to any asset, not just homes.
Yeah I would agree Perry this is a tool for the more savy distressed seller…I am assuming your post about small businesses closing down is orthogonal to this post. In this case these small holding companies were just shells. this Also this particular strategy seems to apply to deadbeats who have higher loan amounts. Thus they are just making the lender jump through more hoops. However the lender will do whatever it takes to get the foreclosure back on track.
SD Realtor
June 21, 2007 at 9:32 AM #61008ParticipantYes this is in a nutshell fraud, (IMO but I am not a lawyer)… Please note, it does seem to me that this can be applied to any asset, not just homes.
Yeah I would agree Perry this is a tool for the more savy distressed seller…I am assuming your post about small businesses closing down is orthogonal to this post. In this case these small holding companies were just shells. this Also this particular strategy seems to apply to deadbeats who have higher loan amounts. Thus they are just making the lender jump through more hoops. However the lender will do whatever it takes to get the foreclosure back on track.
SD Realtor
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