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RobSinger
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March 19th, 2011 at 9:26:14 PM permalink
I don't usually do this but because the topic is such a hot-button issue for these 2 states and because I'm far from a knowledgeable real estate guy, I'm going to throw this out and see what the general feeling is.

My son, who has a wife & 2 small children and lives in Tucson, is an Army lifer and has served 2 tours--one each in Afg. & Iraq. In 2005 he bought a home with our downpayment help (just to keep the payments lower since as a military man he didn't need one). It cost $380k and we contributed $80k. About 2 years ago his home, like many in LV, Phx. & Tucson, plummeted in value, and today it's worth $170k at best. (My $80k wasn't an investment and it wasn't something expected to be paid back).

You know the issue: Keep paying into an underwater situation hoping the value will eventually go back up (which will take years according to reports)....or foreclose and start over again in another home or apt. The problem with that is who's gonna give them a mortgage with that on their record. But, they do not want to leave as they absolutely love their home. So I stepped in, and I felt perfectly fine doing so because of his service to this country.

Here's what we did under my tutilage (and it just finished up today): He stopped paying the mortgage 8 months ago. They got booted out by the bank last month, and they got an apt. and storage place for all their stuff. I closely followed the whole event, I got to know the financial players, and the moment the home was listed as a foreclosure sale @ $165k I walked in with the cash, made an offer of $155k that was accepted, and scooped it up. I then put the house in their names as a gift, I set up a 15 yr. note for my son & his wife to repay me, they have about half the payment they used to, and they finished moving back in today.

Like I said I'm no real estate guru so it was all new to me. Did I do anything that can be considered wrong, or could I have done it any better?
AZDuffman
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March 19th, 2011 at 9:31:29 PM permalink
Quote: RobSinger


Like I said I'm no real estate guru so it was all new to me. Did I do anything that can be considered wrong, or could I have done it any better?



Yes, you encouraged them to walk out on their obligation and have probably ruined their credit for years. Sorry to sound harsh, but you are not supposed to get a new mortgage at a lower principal amount just because values went down. Buying anything entails risk.
All animals are equal, but some are more equal than others
avargov
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March 19th, 2011 at 9:38:08 PM permalink
I don't know if it was necessarily wrong, but it does have a slight smell of deceit. I have no reason to take the bank's side on any issue, but it seems that they are the ones that will be out $100K. That being said, in the same position, I would probably do the same thing. Of course, there is also the issue of your son buying a house that he obviously couldn't afford, which is what got us into this recession anyway. I think his integrity is tarnished by this, but if he can sleep at night, more power to him.
Before you diagnose yourself with depression or low self-esteem, first make sure that you are not, in fact, just surrounded by assholes." ~ William Gibson
RobSinger
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March 19th, 2011 at 9:52:34 PM permalink
Quote: avargov

I don't know if it was necessarily wrong, but it does have a slight smell of deceit. I have no reason to take the bank's side on any issue, but it seems that they are the ones that will be out $100K. That being said, in the same position, I would probably do the same thing. Of course, there is also the issue of your son buying a house that he obviously couldn't afford, which is what got us into this recession anyway. I think his integrity is tarnished by this, but if he can sleep at night, more power to him.



First AZDuffman: I & they understand the credit rating issue and we discussed it prior. One thing I forgot to mention is their mortgage payment went (big surprise, right?) up after the first 2 years and then up again. My son hasn't been an angel over the years but he finally has a stable life and nice family, plus I just didn't feel right watching them struggle/suffer with a high payment when he had sacrificed several years of his life at war.

avargov, everything you wrote I agree with. I shouldn't have helped them get that loan by making that downpayment, and I know that's the type of nonsense that caused the US financial problems. I blame myself, but I also gave up $80k. But it all comes down to my melting like butter because of what he did. OTOH, I do feel kind of good for successfully double-dealing the bank on the house. As far as I'm concerned, banks can bite me.
Wizard
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March 19th, 2011 at 10:36:18 PM permalink
I can't fault you or your son. The system incentives failure, so why not take advantage? Personally, I've lost half a million dollars in Las Vegas real estate, and see my taxpayer dollars ultimately cover what the bank lost on your son's house.

However, if I were in your shoes, or your son's, I think I would have done the same thing. Actually, I applaud you for your success, I might not have played it so well. So I wouldn't feel guilty about it. My anger is directed at the banks for making bad loans in the first place, and the regulators for turning a blind eye to it.
"For with much wisdom comes much sorrow." -- Ecclesiastes 1:18 (NIV)
EvenBob
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March 19th, 2011 at 11:12:10 PM permalink
Quote: RobSinger

, and the moment the home was listed as a foreclosure sale @ $165k I walked in with the cash, made an offer of $155k that was accepted, and scooped it up. I then put the house in their names as a gift,



Its the fantasy that all home owners in that position can only dream of, and here we have somebody that actually pulled it off. Were you wearing a super hero cape in this dream, could you fly too? I'm sorry Jerry/Rob, or whoever you are, but I don't believe a word of it.
"It's not called gambling if the math is on your side."
Wavy70
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March 19th, 2011 at 11:13:31 PM permalink
What you did is not dissimilar to during the depression when farmers would band together and allow only one bidder for a nominal amount of a few dollars and return the land to the previous owner. The rules they set up are flawed and you took advantage of them. No need to feel bad.
I have a bewitched egg that I use to play VP with and I have net over 900k with it.
Paradigm
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March 19th, 2011 at 11:18:59 PM permalink
I think the same is true of the bank as well......lending on anything entails risk of default. They made the loan, the borrower defaulted and their security went down in value so they got stuck. This is a business deal, not a morality lesson.

The cost of foreclosure is the credit rating issue the borrower will deal with in the future. They make a business decision as to whether that cost is worth the benefit of getting out from underneath the obligation. To me there is no right decision that fits everyone, there is a right decision based on the economic costs and benefits for the individual that is making the decision.

To blame the financial crisis solely on the borrowers is incorrect. If their was loan fraud in the application process, then I may have a different answer. Individuals that commit loan fraud in the application process should be criminally prosecuted.....I believe it is a felony!
EvenBob
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March 19th, 2011 at 11:26:32 PM permalink
Quote: Wavy70

What you did is not dissimilar to during the depression when farmers would band together and allow only one bidder for a nominal amount of a few dollars and return the land to the previous owner. .



That didn't work for long. Soon the banks put minimum bids on properties so the farmers could no longer steal the property from the bank. Its amazing how banks are heroes when they loan somebody money and evil incarnate when they want the money back.
"It's not called gambling if the math is on your side."
Wavy70
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March 19th, 2011 at 11:54:29 PM permalink
Quote: EvenBob

That didn't work for long. Soon the banks put minimum bids on properties so the farmers could no longer steal the property from the bank. Its amazing how banks are heroes when they loan somebody money and evil incarnate when they want the money back.



Correct, however as I said the banks set the rules and someone found a hole in the rules so to not take advantage would be foolish.

I never said the banks were Evil and looking back I missed where anyone else did. But in many cases the banks knew that the loans they were making were shaky at best. My SIL's brother worked for a now infamous former lender. He told me close to a decade ago about all he needed to know was they could make a few payments and then they sell the mortgage. I asked what he thought would happen in the long run and all he could tell me about was his new S class in the driveway. Same blinders were on buyers. Last year this house was 200k now it's 250k. That must mean next year it will be 300k.

Many lenders took advantage of a situation foolishly as many lendees did. In reality they both lost.
I have a bewitched egg that I use to play VP with and I have net over 900k with it.
FleaStiff
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March 19th, 2011 at 11:59:28 PM permalink
All those major downturn markets decades ago had many people walking out of one house and buying the identical model across the street. Banks look at current market value and so do the mortgage payors.

Vulture funds buy up many properties. Is a Vulture Fund a different "buyer" than a previous owner?
EvenBob
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March 20th, 2011 at 12:54:32 AM permalink
Quote: Wavy70

in many cases the banks knew that the loans they were making were shaky at best. .



Of course they did, but the parent banks had Clinton & Janet Reno breathing down their necks if they didn't make loans to every deadbeat who walked thru their doors. What Bush's excuse was I haven't heard yet.
"It's not called gambling if the math is on your side."
fremont4ever
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March 20th, 2011 at 12:56:27 AM permalink
To make a very long story short, I don't see anything wrong with it. You're very generous, Mr. Singer.
Wavy70
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March 20th, 2011 at 1:36:54 AM permalink
Quote: EvenBob

Of course they did, but the parent banks had Clinton & Janet Reno breathing down their necks if they didn't make loans to every deadbeat who walked thru their doors. What Bush's excuse was I haven't heard yet.



I think you are referring to the bill authored by Phil Gramm (R) who penned the deregulation bill and it was passed through a republican controlled congress and signed into effect by Clinton. It stripped many of the banking rules. Not sure anyone's nose is clean in this case.
However as attorney general Reno (the most uh statuesque AG) her actions are really limited by what the law says.
I have a bewitched egg that I use to play VP with and I have net over 900k with it.
timberjim
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March 20th, 2011 at 2:17:40 AM permalink
Quote: RobSinger

I
Here's what we did under my tutilage (and it just finished up today): He stopped paying the mortgage 8 months ago. They got booted out by the bank last month, and they got an apt. and storage place for all their stuff.

Like I said I'm no real estate guru so it was all new to me. Did I do anything that can be considered wrong, or could I have done it any better?



Where I live, they are still liable for the amount they still owe the bank unless it was discharged in a bankruptcy. Just the same as if you get a car repossessed and sold at auction. You still owe the lender the difference. It may take awhile, because banks are currently overwhelmed with volume, but they will eventually come after them for the money that they owe.

People that think they can simply walk away from their obligations always amaze me.
RonC
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March 20th, 2011 at 2:20:38 AM permalink
Isn't this kind of the same thing Donald Trump has become famous for...taking properties/organizations in and out of bankruptcy to end up with a better deal? It is hard for me to condemn a more "common man" for doing something we widely accept from a "highly successful business man". Financial supporters (investors, bankers, etc.) often end up on the wrong end of the stick in high-risk deals. They still invest in them because of the potential high reward.

I find it hard to condemn your actions when we make a star out of someone like Trump...
SOOPOO
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March 20th, 2011 at 4:12:43 AM permalink
It seems like Mr. Singer made an "AP". The issue I have is that when your son took out the loan (mortgage) he should have known the terms and the rise in payments should not have been a surprise. The value of the house is irrelevant if you are still living there. You are just paying off a loan. That being said, if I was in Mr. Singer's shoes I very well might have done the same thing.
Wizard
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March 20th, 2011 at 4:47:37 AM permalink
Quote: timberjim

Where I live, they are still liable for the amount they still owe the bank unless it was discharged in a bankruptcy. Just the same as if you get a car repossessed and sold at auction. You still owe the lender the difference. It may take awhile, because banks are currently overwhelmed with volume, but they will eventually come after them for the money that they owe.

People that think they can simply walk away from their obligations always amaze me.



That is as it should be. However, Rob fortunately lives in Arizona, where banks can't go after borrowers after a strategic default. (source: WSJ.) If I had any say I would give the banks liberal rights to come after the former homeowner any time they wished.

Quote: Wavy70

What you did is not dissimilar to during the depression when farmers would band together and allow only one bidder for a nominal amount of a few dollars and return the land to the previous owner.



That happened on Little House on the Prairie.
"For with much wisdom comes much sorrow." -- Ecclesiastes 1:18 (NIV)
AZDuffman
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March 20th, 2011 at 6:02:43 AM permalink
Quote: RobSinger

First AZDuffman: I & they understand the credit rating issue and we discussed it prior. One thing I forgot to mention is their mortgage payment went (big surprise, right?) up after the first 2 years and then up again. My son hasn't been an angel over the years but he finally has a stable life and nice family, plus I just didn't feel right watching them struggle/suffer with a high payment when he had sacrificed several years of his life at war.



Sounds like he was put into a negitive amortization mortgage. Many people went into these because the initial payment was low, but they were not even making the principal payment each month. This is a loan that is good for about 2-3% of the population that has wildly fluctuating income or needs to carry a second mortgage while they sell the first home. I'm guessing it was with WaMu or World Savings?

You, the mortgage broker, or most importantly he should have done the basic math and seen something is wrong. While I thank him for his service to his country, I cannot see using that as justification for walking away from an obligation then walking back into the same home after a shell game with the ownership. At the least, you, he, and his family should never let the words, "Greedy Wall Street Bankers" pass from your lips ever again. (Not that they have, just saying.)

Sorry if my position seems harsh, but I have been in credit, mortgages and titles since 2003. I have seen every angle and every justification for it in people's minds. They all boil down to "I made a bad decision/actions and don't want to pay for it."
All animals are equal, but some are more equal than others
RobSinger
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March 20th, 2011 at 7:48:20 AM permalink
I thank everyone for their input as I wake up the day after it finally concluded. Even Bob.

Don't forget, I lost $80,000. If they had stayed on and somehow met their payments which I doubt was realistically possible, in 10-12 years my downpayment help might have counted.

Mike, thanks for bringing up the Az. law regarding if the bank can recover on forclosures. I did check on that first and was surprised that the debt they were able to walk away from is non-collectible.

AzDuff, you're right that we should have seen something wrong at the onset. I actually did but I was too excited for them and somehow was silent to everyone but my wife throughout. And, before I did this I went to the bank that held their mortgage and talked to them until I was blue in the face about restructuring their mortgage to something they could afford. It didn't matter that they had been there for 4 years and never missed a payment. It didn't matter to them that it was their dream home. It didn't matter to them that he is a war veteran. And it didn't matter to them that they had a second child on the way. This particular bank received billions in bailouts yet they couldn't help a young couple stay in their home. Even when I asked whether they thought is was better that they foreclose or if they modify it to something they could handle better, they really didn't care one way or the other. Total greed & totally inconsiderate. That's when I knew I had to think of something.
Wizard
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March 20th, 2011 at 8:23:31 AM permalink
Quote: RobSinger

This particular bank received billions in bailouts yet they couldn't help a young couple stay in their home.



Yet one more way the government rewards failure. No wonder we have so much of it in this country.
"For with much wisdom comes much sorrow." -- Ecclesiastes 1:18 (NIV)
buzzpaff
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March 20th, 2011 at 8:48:09 AM permalink
Quote: Wizard

Yet one more way the government rewards failure. No wonder we have so much of it in this country.



As long as we have "too big to fail", taxpayers will be on the hook again. Those who ignore the mistakes of history are doomed to repeat them.
gambler
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March 20th, 2011 at 9:06:27 AM permalink
I am involved in a lot of real estate transactions, and in your case I would strongly encourage you to consult with a local Arizona real estate attorney, even though it is after the fact. The FBI has been seriously cracking down on mortgage fraud on all levels, and your case is definately border-line.

I really feel for your son and his family. It is great that he served his country in the Army and bless him for that. I hope he understands that by being foreclosed on, he is going to have his credit ruined for a while, (7 years). Even after that time, it will take many more years for his low credit to become good credit. You are a good father for wanting to help him.

Here are the problems that you should discuss with your real estate attorney:

1. You provided him with the $80,000 cash to buy the house in the first place. Was your name on title? Did you co-sign his initial loan? Did you simply "gift" him the money? How did that appear on your/his tax returns?

2. You purchased the exact same property that your son foreclosed on. Had you purchased a similar (but different) property, the legality becomes clearer. Also you have already put their names on title and have given them the property as a gift. This is definately a grey area and may be something the FBI will crack down on in the future.

Once again, I do not practice real estate law in Arizona so I can not give you legal advice. I can only *strongly* suggest you get an attorney involved now in the process. They will probably say, "Let's wait and see what the FBI does," but get their legal opinion immediately.

Good luck!
Wavy70
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March 20th, 2011 at 9:22:06 AM permalink
Quote: Wizard




That happened on Little House on the Prairie.



I live near Rose Wilder Lanes house. Laura Ingalls Daughter. Laura wrote many of the books there.
Never pictured you a LHOTP fan
I have a bewitched egg that I use to play VP with and I have net over 900k with it.
RobSinger
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March 20th, 2011 at 9:25:41 AM permalink
The credit issue is understood and we hope for the best on that. I don't use credit any more, which is probably clouding the fact that he will. Definitely an issue.

My name was not on the title and it was a gift. The $80k was not a requirement of the loan and I only did it to make his payments more affordable. Sort of to make his time away easy on his mind that his family was OK.

I didn't think to check with an atty. or the FBI, but because of my past work in the Gov't I do have a friend who has a son in the Phoenix office and I'll informally run it by him. I don't see a problem other than maybe ethical because it may be borderline, but IMO everything financial is a game these days and whoever plays it the best comes out ahead. This is probably not an event that happens very regularly because you have to be in the right situation to do it. And if the bank wasn't so pig-headed when I gave them the opportunity to do something reasonable seeing that our Gov't helped them out of a pickle, my mind might not have even gone into overdrive on this.
Wizard
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March 20th, 2011 at 9:41:20 AM permalink
Quote: Wavy70

Quote: Wizard




That happened on Little House on the Prairie.



I live near Rose Wilder Lanes house. Laura Ingalls Daughter. Laura wrote many of the books there.
Never pictured you a LHOTP fan



To avoid hijacking the thread, I have answered you here.
"For with much wisdom comes much sorrow." -- Ecclesiastes 1:18 (NIV)
SFB
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March 20th, 2011 at 10:21:57 AM permalink
Mr Singer:

Sorry you lost $80k. Thank you to your son for his military service.

ANYONE can show up at the Courthouse on Auction day and purchase any property for any amount above the opening bid.

If the bank offerred the property for $155k, and accepted the bid, then Mr Singer is a winner.

But that isn't what happened, is it?

At the auction, the Bank put in a bid for the amount of the loan. Which was about $300k. Nobody was going to top that bid at the auction...

And the bank, now owned the house. After a period of time, in 3-4 weeks, in this case, the house was listed for sale. For $165k. Mr Singer offered a cash deal for $155k, which the BANK, or its AGENT, accepted.

What Mr. Singer DID after that is immaterial.

Was thier fraud in the strategic default? Maybe. That is the issue. Lets "walk" on this mortgage, even though we had the resources to pay it, and had been paying it, till they STOPPED, not from the economic circumstances not allowing them to pay it.

Yes, the banks, the big ones and the small ones, are NOT making Loan Modifications easy. And as much as you may have wanted to push the bank in your direction, it was your son's loan, and maybe, just maybe, that process wasn't followed. Or maybe it was just a PITA process, and why bother, if at the end, what you are going to end up is the following:

1. The original mortgage principal still due, plus:
2. Collections and modification costs, with a
3. Possible reduction in interest rate, with a chaser of:
4. A NEW 37, 38 or 40 year mortgage on the same property.....

So walking makes alot of sense......

But we will always wonder if it was legal, won't we? I mean, it probably was, but when you draw a straight line thru the entire process, you can see that "spirit" of the various laws or ethical actions may have been violated.

Had his son just declared bankruptcy, he could have ended up in the exact same place. But there wouldn't have been the stench.

Just my opinion.

SFB
SFB
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March 20th, 2011 at 10:24:42 AM permalink
Mr Singer:

Talk ONLY with an attorney. That way you can say what you have to say.

You talk with your Friend in Phoenix, you might put him in a very compromised position.

And I really don't think you have to talk to anyone.....

As I have already posted above.

SFB
RobSinger
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March 20th, 2011 at 11:35:20 AM permalink
The process you outlined is close to how it went down.

They could have continued making the payments (although I have my doubts, in which case we would have been pouring more money their way) after the loan again adjusted, but it would have meant no life outside of paying the mortgage--at best.

I don't know about what a bankruptcy would have accomplished. Declaring it would not have made the lender modify the loan.

I just talked to my son on the phone and told him he'll now have to use his head when talking to his neighbors. They saw a foreclosure sign in his front yard, they saw them move out, now they've seen them move right back in again. I know if I were next door and if I were paying my underwater mortgage like a trooper, I'd have a problem with that. He and his pals are all Army guys so I don't see it going any further than the dirty looks and maybe the women making a stupid comment here or there on the playground or in the daycare center. Luckily, out here you don't make many friends next door anyway because of all the walls we have.
Mosca
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March 20th, 2011 at 11:35:25 AM permalink
I think that what you did was fine, and I think it was legal.
A falling knife has no handle.
EvenBob
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March 20th, 2011 at 2:57:35 PM permalink
Quote: gambler

The FBI has been seriously cracking down on mortgage fraud on all levels, and your case is definately border-line.



Of COURSE it is! But no worries, it never happened. Its an urban legend, doing what Singer claims. I've read it and heard it, somebody lives in the house till they get kicked out and a close relative, usually a rich uncle, buys the property at auction and gives it back to the forlorn nephew. Its a tear jerking story, except its just about as credible as Big Foot. This is the same guy that has the fantasy casino life, remember? The whole point of his 'story' is to show us he has 150k laying around from his wild success at the machines. This whole thing stinks from top to bottom.
"It's not called gambling if the math is on your side."
RobSinger
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March 20th, 2011 at 4:33:50 PM permalink
Let me guess: you didn't get along with MKL, you didn't get along with Jerry L., so now that they're gone you go out of your way to look for my posts and make up hate posts about me, am I close? In fact, it appears that most of your posts give the outline of a terribly unhappy aging fellow with a pessimistic & sour outlook on life, who just so happens to think anyone who's doing something decent is a joke and anyone who does something different than how you would do it is wasting his or her time.

I'm guessing you wouldn't like the size of my 401k either. Urban legend. No one could possibly have success anywhere or "$150k laying around".
Is everything alright at home?
boymimbo
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March 20th, 2011 at 4:44:19 PM permalink
The question I have is why would you bother buying the same house?

There are two acts to this which are separate. First, walking away from your house. At that point, the debt becomes non-collectible in some states. Your credit rating takes a big hit and your interest rates on everything that you borrow goes up sharply for seven years. If the bank can collect by seizing other assets, it's similar to a bankruptcy and you have to start over again with close to nothing.

The second act is Mr Singer's volunteering to pay cash to buy another property for much cheaper and to transfer ownership via a gift. The lender (Mr. Singer) now accepts the risk of the son not being able to pay the "mortgage". The people who walked away from the house normally would not have the creditworthiness to purchase the home. So, why purchase the same home? In a region where there are many foreclosures, you might be able to get a much better home for the same cost.

As for the bank's responsibilities, your son is responsible for his debt. He bought the home at the price stated and signed the mortgage papers and agreed to baloon rates and all of its terms. Conversely, if you don't pay your debt, your credit rating gets penalized and the banks can do whatever they can do under state law to retrieve the money. The son has dissolved his loan. You have bought the home. There is nothing illegal. The son does not own the home and therefore the bank cannot retrieve the home from them. Your act of buying the home doesn't matter -- the bank receives the money that they asked for. The bank has recovered as much of their losses as possible - your son is in a home. The only loser in this is you in that your son is in debt to you for 15 years... a very nice act, indeed, but you are accepting risk.
----- You want the truth! You can't handle the truth!
EvenBob
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March 20th, 2011 at 4:44:25 PM permalink
Quote: RobSinger

No one could possibly have success anywhere or "$150k laying around".



Thats not it at all. Its just that the 'story' fits right in with your M.O.; big casino winner, does the impossible every time he goes, makes lots of money, big shot in all aspects of his life, yadda yadda yadda. I don't believe any of it, you have zero credibility. Plus, your insults are exactly like the ones Jerry used to spew at me, what a coincidence.
"It's not called gambling if the math is on your side."
boymimbo
boymimbo
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March 20th, 2011 at 4:48:12 PM permalink
Quote: RobSinger

Let me guess: you didn't get along with MKL, you didn't get along with Jerry L., so now that they're gone you go out of your way to look for my posts and make up hate posts about me, am I close?



I think that a few people on this forum are suspect about the disappearance of both MKL and Jerry L (presumably, they've met and either married or beat each other senseless) and the timing of the appearance of a prolific poster in the name of RobSinger who didn't post much of a word before these two disappeared.

I don't think RobSinger is Jerry unless he's taken some lessons in English. And I know he's not MKL.
----- You want the truth! You can't handle the truth!
RobSinger
RobSinger
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March 20th, 2011 at 5:03:39 PM permalink
Quote: EvenBob

Thats not it at all. Its just that the 'story' fits right in with your M.O.; big casino winner, does the impossible every time he goes, makes lots of money, big shot in all aspects of his life, yadda yadda yadda. I don't believe any of it, you have zero credibility. Plus, your insults are exactly like the ones Jerry used to spew at me, what a coincidence.



You're a strange & cranky person. Probably have a wife but, well, you know....

Did Jerry ever mention what kind of car I have? That's not real either. Did he mention anything about my family? How fake, no children or grandchildren either--I paid the kids on my website's home page to play the part. Could I have possibly been successful prior to becoming a professional gambler....and really, the best vp player ever? No way to both--just impossible if you ask me.
EvenBob
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March 20th, 2011 at 5:06:23 PM permalink
Quote: boymimbo



The second act is Mr Singer's volunteering to pay cash



The very first thing that would happen is, the bank would notify the IRS that 155K in cash had been dropped on a house. What would follow is an immediate rectal exam into every aspect of the buyers finances. Especially in a drug dealer riddled state like AZ. Ever since 911, spending cash over just a few thousand sends up red flags. A bank suit told me last year the new number was $4500, but its probably changed since then. Its still 10K in a casino, but if you do a transaction with a bank and its over $4500, they have to fill out Homeland Security paperwork, thats what they told me. But because this story is pure fabrication anyway, Singer has nothing to worry about.
"It's not called gambling if the math is on your side."
EvenBob
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March 20th, 2011 at 5:13:15 PM permalink
Quote: RobSinger

You're a strange & cranky person. Probably have a wife but, well, you know....



I'm curious as to why you always go for the personal insults? I was on the debate team in college and we were always taught never to get personal in a debate. It means you've run out of arguments and are trying to win by bringing emotions into the discussion. Please keep my wife and family out of this, its rather beneath you, I would think.
"It's not called gambling if the math is on your side."
Doc
Doc
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March 20th, 2011 at 5:14:39 PM permalink
Quote: EvenBob

The very first thing that would happen is, the bank would notify the IRS that 155K in cash had been dropped on a house. ...


It would not surprise me at all if Mr. Singer's "paying cash" meant that he delivered a check for the full amount, without any loan involved, not that he showed up with a suitcase full of pictures of Ben Franklin. Paying in full with a personal or cashier's check isn't likely to warrant much governmental investigation.
RobSinger
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March 20th, 2011 at 5:14:42 PM permalink
Quote: boymimbo

The question I have is why would you bother buying the same house?

There are two acts to this which are separate. First, walking away from your house. At that point, the debt becomes non-collectible in some states. Your credit rating takes a big hit and your interest rates on everything that you borrow goes up sharply for seven years. If the bank can collect by seizing other assets, it's similar to a bankruptcy and you have to start over again with close to nothing.

The second act is Mr Singer's volunteering to pay cash to buy another property for much cheaper and to transfer ownership via a gift. The lender (Mr. Singer) now accepts the risk of the son not being able to pay the "mortgage". The people who walked away from the house normally would not have the creditworthiness to purchase the home. So, why purchase the same home? In a region where there are many foreclosures, you might be able to get a much better home for the same cost.

As for the bank's responsibilities, your son is responsible for his debt. He bought the home at the price stated and signed the mortgage papers and agreed to baloon rates and all of its terms. Conversely, if you don't pay your debt, your credit rating gets penalized and the banks can do whatever they can do under state law to retrieve the money. The son has dissolved his loan. You have bought the home. There is nothing illegal. The son does not own the home and therefore the bank cannot retrieve the home from them. Your act of buying the home doesn't matter -- the bank receives the money that they asked for. The bank has recovered as much of their losses as possible - your son is in a home. The only loser in this is you in that your son is in debt to you for 15 years... a very nice act, indeed, but you are accepting risk.



At the risk of offending "Bob" I know I'm out but I can afford it. I also don't believe my son will always keep current with the note I had him sign, and if he doesn't I've agreed with my wife that it'll never be an issue that'll hurt our relationship in any way. ("Bob-offending alert!") I could have paid off his mortgage in the first place without the foreclosure and I was thinking of doing that, but the turning point was when I tried & tried to get the bank to be reasonable or even sympathetic, and they treated me like some street punk beggar.

In my initial post here last week I did so to see if WoV would contact me on a personal issue and he did. I'm still here and really didn't expect to be, but these forums are habit-forming.
RobSinger
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March 20th, 2011 at 5:22:12 PM permalink
Quote: EvenBob

The very first thing that would happen is, the bank would notify the IRS that 155K in cash had been dropped on a house. What would follow is an immediate rectal exam into every aspect of the buyers finances. Especially in a drug dealer riddled state like AZ. Ever since 911, spending cash over just a few thousand sends up red flags. A bank suit told me last year the new number was $4500, but its probably changed since then. Its still 10K in a casino, but if you do a transaction with a bank and its over $4500, they have to fill out Homeland Security paperwork, thats what they told me. But because this story is pure fabrication anyway, Singer has nothing to worry about.



So confused....

If you got out more you'd see a massive amount of cash being used to buy up forclosed homes. Anyone who worries about the IRS and cash transactions is probably just amazed when they see a stack of hundreds. Every time I went to LV for a session I took $17k and got another $40k from BofA if I needed it when there. Making legal cash transactions means nothing. You're making up scenarios based on inexperience.
RobSinger
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March 20th, 2011 at 5:30:48 PM permalink
Quote: EvenBob

I'm curious as to why you always go for the personal insults? I was on the debate team in college and we were always taught never to get personal in a debate. It means you've run out of arguments and are trying to win by bringing emotions into the discussion. Please keep my wife and family out of this, its rather beneath you, I would think.



I would imagine you were a shining star on that debate team. The problem here is, there's no debate. You're just imagining it while being your same pessimistic self as you wear your hate on your sleeve.

You have a wife? I didn't know. I really wouldn't have expected it with the negative attitude you show on just about every issue I've seen so far.

Your last statement says you "think". If that's true, please show more of it before making your dumb accusations and wild assertions. It's rather beneath you, I would think.
boymimbo
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March 20th, 2011 at 5:43:47 PM permalink
FYI -- lots of negative people have wives.

And to offset the blonde jokes that have be pervading this forum...

TRUE MEANING OF MALE STATEMENTS

Statement: "I'm a Romantic."
True Meaning: "I'm poor."

Statement: "You're the only girl I've ever cared about."
True Meaning: "You are the only girl who hasn't rejected me."

Statement: "I really want to get to know you better."
True Meaning: "So I can tell my friends about it."

Statement: "She's kinda cute."
True Meaning: "I wouldn't kick her out of bed but a pillow over the head might be necessary."

Statement: "I don't know if I like her."
True Meaning: "She won't sleep with me."

Statement: "Was it good for you?"
True Meaning: "I'm insecure about my manhood."

Statement: "I had a wonderful time last night."
True Meaning: "Who are you?"

Statement: "Do you love me?"
True Meaning: "I've done something stupid and you might find out."

Statement: "Do you 'really' love me?"
True Meaning: "I've done something stupid and you're going to find out sooner or later."

Statement: "How much do you love me?"
True Meaning: "I've done something really stupid and someone's on their way to tell you by now."

Statement: "I have something to tell you."
True Meaning: "Get tested."

Statement: "I've been thinking a lot."
True Meaning: "You're not as attractive as when I was drunk."

Statement: "I think we should just be friends."
True Meaning: "You're ugly."

Statement: "I've learned a lot from you."
True Meaning: "Next!!!!"

Statement: "I'm on a long distance call, can you call me later?"
True Meaning: "I gotta turn on my answering machine."



--------------------------------------------------------------------------------
----- You want the truth! You can't handle the truth!
EvenBob
EvenBob
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March 20th, 2011 at 5:46:08 PM permalink
Quote: Doc

Paying in full with a personal or cashier's check isn't likely to warrant much governmental investigation.



Its all considered 'cash' by the gov't. In fact, just getting the cashiers check would start the ball rolling, thats how I found out about the $4200. I was getting a cashiers check when the bank suit told me. He later said he wasn't supposed to do that and he could lose his job if they found out he had told me. I was getting a check for 5K and he said I should get 2 checks for 2500 or some such. I don't remember the details.
"It's not called gambling if the math is on your side."
RobSinger
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March 20th, 2011 at 5:49:45 PM permalink
Quote: Doc

It would not surprise me at all if Mr. Singer's "paying cash" meant that he delivered a check for the full amount, without any loan involved, not that he showed up with a suitcase full of pictures of Ben Franklin. Paying in full with a personal or cashier's check isn't likely to warrant much governmental investigation.



What I did was take a cashier's check for $100k plus $75k in cash because I didn't know how much if any I could negotiate downward. There's really nothing nefarious about making large cash transactions if you can show you got it from legal means. In my case I take cash out of my retirement account whenever I need it, and since I'm over 59-1/2 there's no 10% penalty involved. There's no mysterious "IRS rectal exam" and in fact, the only times they've cared anything about me is the audits I had when I filed as a professional gambler for 11 years. And even if there were questions, so what.
EvenBob
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March 20th, 2011 at 5:57:53 PM permalink
Quote: RobSinger

So confused....
you'd see a massive amount of cash being used to buy up forclosed homes.



So? You think that the IRS isn't being informed about every single one of those transactions? its the LAW, if they don't do it they can lose their license. When I owned a small cab company in the 80's, one of my best drivers bought a new car for cash, I think it was 7k. He was in a cash business and hadn't filed taxes in years. The world fell in on him. The transaction was reported to the IRS and they went back 7 years and bent him over the table and shoved it home. He said it was amazing how close they came to guessing at how much he made a year. He paid the taxes and penalties for years.
"It's not called gambling if the math is on your side."
EvenBob
EvenBob
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March 20th, 2011 at 6:02:24 PM permalink
Quote: RobSinger

There's no mysterious "IRS rectal exam"



Sure there is, and there's nothing mysterious about it. But because none of it happened, what are you worried about. If you told me the sun was shining, I'd look out the window to make sure, because maybe it is and maybe is isn't. Thats how much I trust what you say.
"It's not called gambling if the math is on your side."
RobSinger
RobSinger
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March 20th, 2011 at 6:06:30 PM permalink
Quote: EvenBob

So? You think that the IRS isn't being informed about every single one of those transactions? its the LAW, if they don't do it they can lose their license. When I owned a small cab company in the 80's, one of my best drivers bought a new car for cash, I think it was 7k. He was in a cash business and hadn't filed taxes in years. The world fell in on him. The transaction was reported to the IRS and they went back 7 years and bent him over the table and shoved it home. He said it was amazing how close they came to guessing at how much he made a year. He paid the taxes and penalties for years.



It's good the IRS gets notified of those transactions, but if it's done properly then who cares? Why are you so nervous about cash transactions? You seem so pessimistic, suspicious, and really confused with what goes on in the real world. I'm simply removing money from my account and making a transaction. In the past I had a gambling bankroll at BofA and almost weekly withdrew & deposited large amounts of cash, and it was done that way for complete tracibility of my gambling activities regarding money won, money lost, where it came from to gamble with, and how it all perfectly traced to my contemporaneous gambling logs. The IRS is not our enemy if we do the right things. If we do something wrong then we just pay what we overlooked. I just don't see the concern.
EvenBob
EvenBob
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March 20th, 2011 at 6:25:52 PM permalink
Quote: RobSinger

It's good the IRS gets notified of those transactions, but if it's done properly then who cares?



Whats amazing to me is, you're such a hot shot wheeler dealer and you knew nothing about this. Its obvious this is all a mystery to you, and it wouldn't be if you're used to making large cash transactions like you say. If you had really gotten a 100K cashiers check, your bank would have made you fill out the IRS forms. But you make silly and naive statements like "If you got out more you'd see a massive amount of cash being used to buy up forclosed homes". You think just because a lot of it is going on, nobody cares. There's a whole branch of the IRS that investigates every transaction over a certain amount if cash is involved, and they're very good at what they do.
"It's not called gambling if the math is on your side."
RobSinger
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March 20th, 2011 at 6:48:54 PM permalink
Quote: EvenBob

Whats amazing to me is, you're such a hot shot wheeler dealer and you knew nothing about this. Its obvious this is all a mystery to you, and it wouldn't be if you're used to making large cash transactions like you say. If you had really gotten a 100K cashiers check, your bank would have made you fill out the IRS forms. But you make silly and naive statements like "If you got out more you'd see a massive amount of cash being used to buy up forclosed homes". You think just because a lot of it is going on, nobody cares. There's a whole branch of the IRS that investigates every transaction over a certain amount if cash is involved, and they're very good at what they do.



It's amazing to you because you don't read well. Forgive me if I see you as just plain dumb. You must have missed the part where I also had $75k in cash. Or is that suddenly now somehow small potatoes to you? And where did I ever say I never filled out a cash transaction report? You seem to have a fixation on those and the IRS. To me they're nothing but paperwork but to you they're some sort of mysterious, drug-dealer type of suspicious activity gotchas. Get real. You're coming across as someone who's missed out and is angry about it. Except for the part about how exciting it is to grab a 6 pack and a pizza and watch TV in your room. Brilliant.
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