I don’t care if the house was properly listed and got an offer from an unrelated buyer. I DO care if the deal was made before the house hit the MLS/market, and it’s particularly unethical if the deal was made between related parties (including anyone related in any way to the agents involved).
Yes, if banks/regulators required a minimum marketing time, that would be of great help. It would also help if they did periodic audits to ensure agents weren’t ripping them (and the taxpayers) off.
BTW, not sure where you got the “uninformed conspiracy nut” part, but most of my predictions made many years ago have been spot-on from the very beginning. I might be a lot of things, but “uninformed” isn’t one of them, particularly about things I’m willing to debate about (you’ll never hear me argue about things I’m “uninformed” about…I listen and learn from those who know more, rather than debate and make myself look like an idiot). Perhaps you shouldn’t trust so easily.[/quote]
Very few people who know me would describe me as “trusting”.
You have a very incomplete idea about how these things go.
One of my agents had a client who liked a condo but was beat out by a higher offer.
The agent then reached out to the other units/owners in the complex to see if they wanted to sell to her client.
The unit that responded and with which they made a deal was upside down.
They had a deal before the unit ever hit the MLS.
When they put it in the MLS, this was disclosed.
It was appropriate to put this in the MLS for comparative purposes.
There was no fraud.
There was no conspiracy.
The bank did not get screwed.
CAR, you don’t bring a lot to the table as a general rule.
You rant about “fraud” (apparently defined as any result you don’t endorse or understand) and call Realtors crooks.
Fraud has a very specific meaning.
It means a lie that damages another.
I don’t have a great love for most of my colleagues (many ARE crooks) but unless you have some actual examples of fraud please stop wasting pixels.
I do pretty well without lying to anybody.
I think your incomplete understandings coupled with your declarations of moral turpitude put you about one step up from 911 truthers.
You are woefully ignorant and uninformed.
You are the kind of guy that is too smart by half and gets rolled by a dishonest agent and then brags about the deal he got.[/quote]
If I’m so “woefully ignorant and uninformed,” perhaps you’ll trust that sdr is less ignorant and more informed? Here’s a post from a short while ago, on another thread regarding short sale fraud:
Submitted by sdrealtor on February 3, 2011 – 8:52pm.
Just popping in for a comment here. That house on Camphor was stolen by any measure. Finding a nice newer 1 story home in NCC is hard enough let alone a 2600 sq ft home. Throw in a pool and sit down panoramic ocean views and you have the single hottest and hardest to find commodity there is. Not only cant you compare it with non-view homes, you cant compare it with 2 story view homes either. There are always older cash rich buyers looking in this market for exactly what that home offered.
A house like that would have sold easily on 9/11. The banks got totally hosed on that one.
To put it into perspective the last newer 1 story ocean view house I saw with that kind of view sold in the Bay Collection in December 2008 when the market looked about as grim as it ever has. It was 3500 sq ft and sold for $1.83M. House stolen….Case closed
Of course, I’m sure you are so much wiser, better informed, and less ignorant than I; but perhaps you ought to read the news.
“June 10 (Bloomberg) — Two Connecticut real estate agents found a way to profit in the U.S. housing bust: Buy low, sell fast. Their tactic was also illegal.
Sergio Natera and Anna McElaney are scheduled to be sentenced in Hartford’s federal court in August after pleading guilty to fraud. Their crime involved persuading lenders to approve the sale of homes for less than the balance owed –known as a short sale — without disclosing that there were better offers. They then flipped the houses for a profit.”
“What is short payoff fraud?
According to a member of Freddie Mac’s Fraud Investigation Unit, a slight variation of our general definition of mortgage fraud also defines short payoff fraud – “Any misrepresentation or deliberate omission of fact that would induce the lender, investor or insurer to agree to the terms of a short payoff that it would not approve had all facts been known.” Misrepresentations in these schemes may include the buyer of the short payoff property, a subsequent transaction at a higher price, and/or the selling borrower’s hardship reason used to qualify for the short payoff. In many instances, the short payoff fraud will involve a “facilitator,” engaged by either the listing agent or the selling borrower, to assist with negotiating the transaction.
How is short payoff fraud committed?
There are many variations of short payoff fraud. The example below is just one way this type of mortgage fraud can occur.
A seller (delinquent borrower) owes $100,000 on a property that is worth $80,000.
The short payoff facilitator negotiates with the bank to accept a $70,000 offer to purchase the property. In several instances, Freddie Mac has seen that this offer will be made directly by the facilitator or through an entity under his/her control.
The lender/investor accepts the offer for $70,000.
The facilitator neglects to disclose to the lender/investor that there is an outstanding offer between the facilitator and a second end-buyer for $95,000.
Both transactions close on the same day with the net difference being pocketed by the facilitator and increasing the lender/investor’s net losses.”
“Maggiano said that under HAFA, the borrower is required to sign a Short Sale Agreement (SSA) and a sales contract asserting that the seller and buyer are conducting an arm’s length transaction and that they are unrelated by either family, marriage or commercial enterprise.
Mary Alice Short, a real estate agent in Minnesota, described a common type of fraud in the short sale arena where borrowers sometimes have a relative or partner purchase the property in a short sale and rent it back to the defaulted borrower. Other instances of third-party buyers short-changing lenders could haunt the new program as short sales rise in demand.”
That’s fine. But if you read Bee reporter Garth Stapley’s piece a week ago, nothing in this legislation addresses a real problem that has plagued the valley and Stanislaus County in particular: Unscrupulous real estate agents and investors who have manipulated the market through short-sale fraud.
In such cases, agents conspire to freeze out legitimate offers on short-sale properties only to submit their own lower offers through third parties or by hiding behind the anonymity of a limited liability corporation. The banks, trying to cut their losses, accept the lower offer because they were unaware of the higher one. The fraudmeister then quickly sells the property — possibly to someone who tried to bid on it earlier — for a higher sale price in a practice called “flopping.”
Hey, but you’re right, Dan. You bring soooo much insight to this blog. Thanks for correcting this “conspiracy theory nut” who is “woefully ignorant and uninformed.”
Clearly, there is NO fraud, simply because you claimed there was no fraud. You’re right; the scenario described by the OP simply cannot be fraudulent because you, The Almighty Wise One, has spoken. Thanks for all your insightful wisdom!
/snark
Just in case you’ve missed it, negotiating a pre-arranged deal on a short sale that is between sellers/agents and related parties is FRAUD if they don’t market the property on the open market and claim that the deal is an open-market, arms-length transaction. It is FRAUD, plain and simple.
BTW, my family was in real estate before you were even born. I have every confidence in my ability, and have **proven** to have more insight and knowledge than the vast majority of realtors out there. BTW, just because I’m not licensed doesn’t mean I haven’t read all the books required for licensing; I probably have a better understanding of them than most agents do.
