All Forum Posts by: Greg K.

@Tom Gimer  
I do much appreciate your response and advice.  Although my research indicates that unless a specific court order to revoke a DPOA(or healthcare proxy) is sought, an agent-in-fact can still continue using their vested powers,  more to the point however:

"Generally speaking, a buyer cannot get owners title insurance on a deed executed by an attorney-in-fact after a guardian of the property has been appointed."

may actually hold true in my state.  This is now at the top of my list of questions for an attorney.  Thanks again.

Direct communication has been difficult, at best.

Yes it is a mess.  These fiduciary matters are also extra difficult to research, since so much of the case law is not public record. 

The situation I describe here of course can and will be handled by a qualified attorney.  However I want to understand all of the options and steps myself, even if an attorney will ultimately handle things.

Please forgive the long post, I attempt to concisely summarize a somewhat complex situation.

I have a cousin who owns a 2 Family in a hot market, has been a owner-occupied consumer mortgaged owner for nearly 2 decades.  Sadly, the relative has developed dementia and as of 3 months ago is in a nursing home.  I had been assisting  with financial matters for nearly three years, and I am her agent-in-fact/attorney-in-fact under a Durable Power of Attorney.

When she was recently hospitalized and found to be lacking capacity, a sister-in-law appeared and managed to convince the Probate Court to appoint her as my cousin's (emergency)Temporary Guardian and (emergency)Temporary Conservator.  Although the jurisdiction is in the state of Massachusetts, I would greatly appreciate any ideas or advice from other states as well.

The sister-in-law has not been in touch with my cousin, the home owner, in years and has already made several reckless and irresponsible decisions using the powers granted via the Temporary Guardianship/Conservatorship.  The same probate court has accepted my filings in objection, but everything is backed up right now and there are many burdensome factors in play.  It will likely be another month at least before the matter gets even a glance from the Judge.

The sister-in-law immediately began taking steps to try to take control of the property, and is trying to sell it as soon as possible.  It appears she is leveraging nursing home expenses to try to liquidate my cousin's assets.

I was already in the process of preparing profitable pre-sale arrangements to the property and the personal mortgage on it, that would significantly increase the upside on selling the property.  Furthermore my cousin may prefer to return to her home for the time being, which is a far better and safer environment than a nursing  home right now.

The sister-in-law is putting no consideration into arranging a good pay-off figure with the current mortgage lender, nor listing the property on the open market.  Worse yet, she is not considering my cousins wishes, and already has the proceeds from the sale claimed to pay for care that my cousin does not want.

I am trying to find a way to 'halt' or slow down the sister-in-law's process, while we wait for the court to digest all of this.  

My DPOA document has additional language specifically added to grant me the power to perform real estate transactions on the Principle's behalf.  The Conservatorship, on the other hand, pursuant to state law, still would require a judge's approval before closing a Real Estate transaction.

What can I do to protect the property preemptively?

[The property and/or the equity/proceeds would be used to better arrange for my cousin's care.  There is no living spouse or other kin.  The property needs some light rehab, and there are no tenants.]

I have brainstormed:

- Transfer the deed to  a Irrevocable Trust

- Use some other type of specialized Trust

- Some other sort of entity

- Execute a Mortgage or other type of lien on the property

- Find my own buyer and sign a Purchase & Sale agreement with them, there by tying up the property in a deal 

-(bad idea) Transfer the deed from my cousin to myself + my cousin.  This would very likely be contested and would impact my cousin's Medicaid eligibility.

- Many of the other creative Instruments often discussed on this website.

- A specialized deed instrument such as warranty or quit-claim.

(note: some details of the matter are omitted for privacy reasons.  Mods, if this violates any forum rules, please remove this post)

Many thanks for any feedback or advice.

The owner is on board with the whole plan, and has authorized me to negotiate on their behalf.  The other methods just don't suit my fancy.  

@Wayne Brooks

Your informative response is much appreciated!

I just typed up a few paragraphs and then all was lost when attempting to insert a quote.  In short, I agree that the current litigation ultimate purpose is to make another attempt at FC, but properly.

Also many of these procedures and laws are very nuanced and state specific, most of what you are speculating does not apply because the attempted auction occured almost a year ago.  It was rescinded within a week, because the bank really did make a big mistake so state authorities intervened.  And nothing has been recorded, that I was able to find, in 4 years.  Perhaps there's something a local expert would uncover. 

I mentioned a federal statute in hopes of you elaborating on:

"

there typically is no way the bank could take a reduced pay off u less done specifically through the short sale process, due to federal law, mortgage insurance requirements, etc.

"

But I think we understand each other, as in , this is not exactly a typical case.

Thanks again,

-Greg

@Wayne Brooks

Thank you.  Well the circumstances are unique because the property was sold at a foreclosure auction, and then before the new owner got very far into the process the foreclosure was rescinded.

The novel litigation is that the banks attorney filed a lawsuit against the owner, the category of the claim is   "Real Property - Other"  and the complaint of the Plaintiff is that they would like to rescind the foreclosure and reinstate the mortgage, providing the original Mortgage areement as evidence, despite the fact that it is:

1. Still showing as the active recorded mortgage in the county registry of deeds

2. The registry shows no new owner recorded, no foreclosure, in fact, nothing was recorded at all through out these events.  The attorney claims that this doesn't matter because some judge "by gavel" put the property into its limbo state.  Perhaps a thorough title search would reveal something

I don't doubt what you are saying at all, but can you reference the federal statute that prevents a note holder from settling on a compromise, via a contract, with the mortgagor?  (this does occur amidst litigation, though the details of such agreements are kept private) I'm not sure there are any mortgage insurance requirements, on their end, if the mortgage is in a limbo state.  This is why I chose my words carefully by saying the bank does hold interest in the property via a note, because that's all I am sure of.

If this is true, why would the attorney tell me to continue with the plan, and that his client was very interested in the proposal?

Thank you kindly, 

Greg

I know it's quite common that when the owner of a property gives you full permission to negotiate on their behalf, you might find yourself in contact with some person, who is in turn, representing the interests of a major international bank, that holds a significant amount of interest in the property's equity via a mortgage(in this case a securitized, sub-prime, sold and re-sold many times mortgage).

It would be very common in this situation to arrange something like a Short Sale.  However that particular type of arrangement was not suitable, yet the bank is quite keen on liquidating their asset.  So they said to me:   "Give us an offer.  Make a proposal"

It seems as though they are willing to concede anything imaginable, but I have to draft the proposal.  No problem I will.

Question:  When sending a preliminary proposal over email, summarized in layspeak, would adding the standard 'This email in no way shall be interpreted as a contract to.....etc" be sufficient protection from even the most advanced legal 'gotyas' that might get thrown at me?   Has anyone ever experienced anything damaging that survived such a clause?  The party negotiating for the bank is an attorney and is currently in the midst of some rather novel litigation against the property owner.

I already plan to have an attorney that specializes in this field, licensed in my state look over the proposal before i formally offer it.

Can anyone recommend a resource for reading up on best practices and/or precedent for such situations?  Be it speaking with the other side over the phone, via email, in front of a judge, or in lieu of in front of a judge?  (all of these scenarios are plausible in the near future).

Thanks!

Did the seller own the property free and clear going in to the deal, or was there an existing mortgage that would have been 'due on sale'.  I'm not sure about 'fraud' in the proper criminal sense, but cause for an entity to sue another for damages, liquidated or otherwise, sounds very possible.  I think you dodged a bullet.

Some insight from the other side of the front door:

1.  Learn enough about the market in that very specific area, and about the house/owners to determine if you are the 1st person showing up with a creative greeting, or the 5,000th.

Maybe not 5,000, but as the owner of a pre-foreclosure in a booming neighborhood I have heard it all.  And one thing that really rubs me the wrong way, more than anything else, is that most often I am contacted with precisely the same excuse/pitch/tactic as the last 150 people had used.

That in itself I could empathize with, but it's the SHEAR OBLIVIOUSNESS that each investor/realtor seems to have in regards to how unoriginal their approach/pitch is.

2.  Touchy subjects like, equity, repair estimates, market analysis.  Hey, buyer(seller) beware,  If you get a seller who doesn't know the first thing about the real estate market, of course, try to find out what they owe, and offer them a bit more.

BUT

There is the possibility that the owner is a bit savvier then that.  On rare occasion the person trying to strike a deal with me, actually seemed to be paying close attention to me, and adjusting their approach in accordance with what I say, or ow I act, and so forth.

But all in all, I learned to see right through every solicitors exact strategy pretty quickly. It always boils down to, get the property under contract BEFORE I list it on the MLS, Well the few people I ended up at the very least developing rapport with, and might even end up being involved in the final sale, were those that

- rather than trying to confuse me and persuade me of a lowball value, they would offer an authentically superior perk,. Or, this is about 1 in 500, would offer me true and vital information, unprompted, and at least did a great job pretending they needed nothing in return. In fact some really were like that. I noticed those were the same investors and or realtors that I would later look up and see their sales are through the roof. They don't NEED me desperately as their first deal to launch their carefully planned BRRRR plan for 50 years. They're already content, and this is not something that can really be faked, especially in person.

For someone like me, that's the winning strategy,

Obviously that would be a terrible default strategy for society en masse!

But a truly pro bono, non transactional good faith offering of information, try to remember, is truly the default for most other business industries, even when negotiating as opponents,  A quick google search reveals the most common tactics you guys use. Such as "What's you're bottom line"

I quickly developed a simple candid response:  "Why on earth would I tell you that?

Or I would ask for them to send their comps analysis first:

"Well I need to see the condition of your home, how about I stop by..." - click

lol