Is it a scam ?

Question

ok,
I visited a house on foreclosure and left a note. The owner called back and told me someone else is buying the house and only that person will buy the house.
I told the owner that I just need your approval so I can also call your lender but the owner said no way. because I want only him to buy the house.
I even offered some cash to the owner. but to no avail.

My questions now.
Why owner is saying that he wants that person only to buy the house. Are they related so that owner doesnot give his consent to anyone but his relative.
and then his relative goes to lender and offers pennies on dollar?

Or
The person is a professional investor who has sign some sort of agreement that the seller will not give permission to anyone else.

What do you guys think?

Richard Warren · Answer

What a sad story, but a great post.  I think we all have a tendency to forget the human element when looking at deals.  Some people are in trouble because they made stupid decisions or got greedy and have no one to blame but themselves.  Others, like you, are a victim of circumstance.  It seems that you came out stronger but I’m sure many do not.  Good luck to you.

8)

N/A N/A · Answer

Although there are many reasons why someone goes into foreclosure and many issues can change the condition, I would like to give you a glimpse into the eyes of one I know.

In the begnning, this hard working couple both wih decent jobs find they are doing well.  They make great pay and together, they clear say $100,000 annual.  Life is good, they decide to have a child between them, and they are successful at doing as they planned.  He is a software engineer, she works for a office supply warehouse, but she had to quit due to complications in the pregnancy.

They evaluate the situation and decide they can tighten their belt and survive the pregnancy without her income.  They find they can even manage picking up a family van to take into account the new member in their family head count.  The money is tight, they make it each month with about $200 to spare.

Death of th DOT com's comes into play.  Then comes the Microsoft lawsuit issue with the contractors and the monopoly federal judgement against Microsoft.  This hits his wallet really bad.  His contract ends and he is out interviewing for a new job, only to find that the software industry is in a down trend.  He is competing litterally against 5000 other resumes for the same positions. bills fall behind, times get hard and desperate.  They talk to family and friends for help, but all they can do is offer advice. Ever know someone who didn't have advice?

They get their notice of delinquency, along with all the other bills, shutoff notices.  Before they make it to the notice they have already stopped reading letters from people offering to consolidate their debts.  All of them want even mor money from them than the consolidation will save.  So it is pointless.  Now the notice goes out and the phone begins ringing off the wall.  People begin hanging around their home for hours staring, taking pictures, dropping off letters and notes. 10 - 20 per day is mild to say the least.  These are people who all promise to help them and save their home, instead, they are trying to figure out how to get $25k or more out of the deal but they put on a good show.  The couple is quickly memorizing the lines that these people say and become numb to the statements.  At some point the owners, laugh and close the door in someones face when they hear the first 3 words.

The calls stop coming in not because the phone is shut off, but because the owners can't stand the flood of calls from sharks wanting to take away something that has been in the family for 17 years, their home.  They just want some help to find a solution.

Wife tried to take her job back, but Dr wouldn't allow it.  He tried to take jobs for half his previous pay, but market is still flooded.  Just a year before all this hit, they had refi'd their home for home improvements they were doing, it put them at 80% LTV, but when the market dropped, it lowered their LTV as well and they were upside down, so no lending agent wanted to work with them.

The insanity factor was running full tilt.  The man was crushed, he could do nothing more than run on auto pilot, hunt for jobs, remodel to improve the value and maybe make enough improvements to make the home worth a better LTV to get some help.  Working night and day on the solution, driving off the sharks that wanted his families home.  Now the next collapse of his reality hits... his son is born into turmoil.  Frequent visits from strangers wanting to take daddies home.  Causing daddy more stress anxiety, fear, petrification starts setting in.

Pink Floyd song plays in his mind over and over.  Now he has another child and it's needs to deal with on top of this, diapers, milk, baby items galore.

A contract comes through, he starts getting the debts paid and off his back, but he had to take a job at half his previous pay, and he can't make enough to cover the bills.  Borrow from Johny to pay bob, to pay susan, etc becomes the name of the game.  He tries to negotiate to stop the preceedings, but they want all the money caught up before they stop the action, it is too late, so he tries to save everything else.  Six months later, he finds that the contract is coming to an abrupt end as his company is performing a re-organization, he is cut from the contract.  The cycle of hell resumes for another 8 1/2 months.

During this time, his wife wasn't able to work due to health conditions during pregnancy, he is still alone.  No one to turn to, no one to help. Things are getting worse.  Three months into the situation and the new van ends up with a seiged engine.  Their folks pass them a beaten down van to replace the one lost, less than a month after that, the lenders on the van come to do a repo, at least he won't have to put it in the shop to get it repaired, he thinks to himself.

Just as the wife's health begins to return, she reports to him that jr is going to have a playmate.  Yep, another one on the way.

Notice of trustee sale shows up.  Now the sharks get vicious and ugly.  Drilling through the numbness a piercing dagger of failure  on the man.  A man who at one time had never known the word failure, a man who thrived on success even against all odds.  Now this dagger was drilling his brain that he was losing his home, he was never gong to be able to successfully pull out of this and he might as well sell to them at a 20 - 30% loss.

All the while, he kept looking at the living room he had remodeled completely with his own hands, the bedrooms, the new infants room, the back deck, the storage units, the front yard rose garden and landscaping all done with his hands, blood,.sweat and tears.  The precious items that made his home speial to come home to every day, now this vulture wanted it.  Now they were gonna get it and that was all there was to it, nothing more he could do.

A new job came through, but it was too late, they had already received their notice to vacate.  It was gone, all of it, lost without a fight, without mercy or compassion, long hard years of work only to lose it by a little letterstating 90 days to vacate.  17 years of memories now becoming someone elses dreams.  It was all gone.

Yes, this was me.  So remember, even though it means business to you to help these people, it doesn't mean the same to them.  Don't pretend to help them, work with them to cope, but don't drill them with a fate they know long and true.  They have just spent the last XXXX amount of time letting that sink in.  Instead, be a friend, be sinsere, educate them and show them you want to work with them through these trying times.

It was this situation that got me to where I am today, bound and determined not to allow this to happen to anyone else.  Now I spend my investing career helping to find the solutions and if all else fails, I help them face it as best I can.  I even hook up with them after the fact.  I don't talk much about their home, but I do make sure that they are doing better.  I try to help them transition as best I can.  Taking their home is my last alternative.  Even then, in cases where it was a simple hard ship like I encountered, I try to set them up with a lease/option as a chance to keep their home with me owning it for a few years while they get back on heir feet.  Keep in mind that if they trash the house after losing it, I actually don't keep my end of the dea either.  I don't lne them up with their old home, instead I line them up with one that fits their financial needs, meanwhile, I improve their home.  If in a year things get back to good for them, I offer them the lease/option for their home back.  Then I let them earn it back.

N.A N.A · Answer

A lot of foreclosure owners are in denial about their situation. Some want help, some are confused, and some are just delusional. I would probably call every now and then to get an update on the situation. Just keep an eye on it, once the notice of sale is filed call the owner again and see if they are willing to work with you. If they are, you can get an extension on the sale.

N/A N/A · Answer

It's impossible to know the answer to this.

Possible reasons:

investor told them that others will come and scared the crap out of them so they speak to noone else.

they have a friend, family or someone in the business and possible will try to buy the house as a short sale so they can continue to live there.  maybe the daughther with a different last name will buy as short sale and have the dad keep it and benefit from a lesser sales price.  I seen it happen.

Could be anything.  bottom line.  You don't need to worry about those prospects, find those that are willing to work with you.

N/A N/A · Answer

Or the person that called you wasn't the owner... Another investor like your self went to the same house and saw your note and decided to mess with you so you don't come back to that house. Believe it or not there are assholes out there like that. I've dealt with some and when I get the hint it's one I love  messing with them, because they just end up hanging up... =)

N/A N/A · Answer

O.K. There is no way the person would have called you back if you didn't peak his interest. You have a foot in the door. You have to establish a relationship with this person.

He is telling you that for the simple fact that the person he is talking to told him to say that.

How to overcome that is to simply bring it to light. Say, "I know you were told to say that and I know you're an intelligent person. Wouldn't be in your best interest to be sure you have all the facts and figures before completing a transaction?" He really can't say no to that. Then you give him just that and in doing so, you establish a bond. Be personable and have his best interest in mind. Let God, the Universe or whatever else you call it handle the rest of the details.

I don't know what your experience level is at this but I have found that the less you invest (emotionally) in the outcome, the more likely you are to get the deal. And if not...S.W.S.W.S.W....N (Some will. Some won't. Someone's waiting...Next) Good luck

N/A N/A · Answer

Of course there's no way for me to know, but if I had to guess I'd say that this guy has been inundated with "investors" ever since his house started appearing on those foreclosure lists. He must have found someone he thinks he can work with and he's now trying to shut the floodgates. I've heard that once you appear on some of those lists you will get upwards of 10-20 calls/knocks/postcards per day.