AFSCME 3357-HOF'S BLOG

Another "We Buy Homes" Horror Story

This one from screwedcentral.com


ScrewedCentral.com

I see these several times a year working intake at UAW Legal Services Plans. These cases are very hard for private attorneys to address. The bad guys know they are breaking the law, and they have an exit strategy. They have their victims sign a lot of mumbo-jumbo documents that take a long time for every one involved to digest. In my experience, the documents are internally inconsistent. What you end up with is the "We Buy Homes" operator, whom I'll call WBH, receiving apparent agency to enter into a rent to buy contract with an innocent third party, Whom I'll call ITP. ITP is in the house under an apparent contract to buy, there is an agency document from the apparent seller. Therefore you have to actually file a foreclosure suit against the ITP to get the ITP out, and that doesn't do anything to collect the "rent" money that WBH ran off with. Also WBH promises to make the mortgage payments in the interim, but doesn't.

What you end up with is a truly tangled mess. Original Home Owner, OHO, who doesn't have much cash to begin with (hence the attractiveness of the WBH offer), has to fight on three fronts. OHO has to fight mortgage company. OHO has to fight ITP to get them out of the house. OHO has to go after WBH. The difficulty of the battle allows WBH to cut a sweetheart deal that lets WBH keep on working the scam. In the alternative, if the heat gets too hot, WBH vanishes and reappears under a different name somewhere else. How does a private attorney take a case like this on behalf of a homeowner? Definitely not on a contingency-fee basis. On an hourly fee basis, a candid attorney should tell the client that it would be unusual to finish the case without spending five figures on attorney fees. Most of these things don't have a satisfactory result. (Luckily for our clients at UAW-LSP we don't charge for our services.)

Prosecutors should take these cases more seriously and treat them like the fraud cases they are. They should realize that people are losing their homes and usually bankrupted by these crooks.