All Forum Posts by: Thomas D.

Fall River Dreams. Long live Chris Herren.

Pay the extra $$ and support the country. Let China burn

clearly the idea is illegal.  But lets not all act like if we owned these condos and some random buyer came along and bought 2 at 275k we wouldnt be rushing to cash out our condos or refi them. Lets be real. 

This is exactly what I have in the bank now. Ive decided to save it and get out of the quads and duplexes I have and Grant Cardone something when I save 300k-500k. 

This has been very very helpful. Hey you cant get anywhere unless you make a few suggestions and try some new techniques.  Clearly this method isnt a very wise choice.  Thanks all.  

yeah ive never done anything illegal before I was more inclined to approach this idea as “making a market.”  It may unnatural in its creation but I was interested in the idea.  I wonder if I created the artificial price and waited for another non associated condo to close at the new higher price if it would clear the smell test?  Maybe if i never even borrowed against my other condos and just created a new ceiling and sold years later if this would work. Interesting idea. But I would be sure not to do anything illegal. 

Thanks Doug, a very interesting posting.  After reading that I can see where if I gave the money I made on selling the first two condos back to my uncle it could be construed as illegal.  But if I kept the money and contributed it to a joint venture together using that money then it might skirt the issue.  On the other hand the website it doesnt seem to address anything tied to then leveraging my remaining condos based on the new higher comps created by selling the first 2 condos.  In starting this thread I really wanted to get down to the idea of creating new equity out of thin air using this technique.  

Thank you Wayne you sound like the attorney that told me my first double close was illegal and refused to do it.  He just said he felt it was wrong and wouldn't do it.  I'm trying to get advice from this community. People who have legal and professional experience in doing unconventional strategies with real estate. I'm asking for experienced advice on why this is illegal beyond saying buzz word like self dealing and ethically challenged.  I really dont want to be confrontational, just educational.

Phil, thats why I'm asking. Is this illegal or not?? If it is then I'm trying to find out why.  Not if it feels weird or not. Some people think the no money down stuff we do here is illegal but its not. I want to go beyond eye of the beholder into law.  Is this legal or not?  By the book legal or not.  

It seems like that but isnt a straw man purchase based on inflating the price of a property then borrowing against that specific property?  If you create a comp on property A then use that comp to borrow against property B then it seems legal.  Its the same thing we all do in the market.  We use comps to refi out cash all the time on our properties.  Theres no law against buying something for more than its market value.

Its a gray line I suspect but not outright illegal.  The self dealing seems to be out of play because there really isnt a rule that says a close relationship cant buy something from you.  I can sell my mom my condo for whatever I ant to if she will pay.  Its making sure she doesn't then do something with that specific condo that becomes an issue. Not what I do with another entirely different condo she has no ties to. 

To me it seems like the ethical edge we all straddle when assigning contracts and double closing when we dont actually have our own money.