Rent back deals 'need firm rules'

GDB2222

silvercar wrote: »

I know of one house where the owners wanted a quick sale as they were emigrating. House was on the market at 419,000 (May 2007). I saw it advertised on one of the singingpig leads pages, so I guess someone took the bait. Next thing was it was advertised locally at 379, then 379 part exchange considered, then 369, then 349. Nice house, only a few years old and improved with conservatory and decking etc. I guess someone has offered around 320-240 mark. But for whoever bought it as a quick turn around proably hasn't made a bean.

Ah, thanks for the warning!

northeast1976

GDB2222 wrote: »

I stand here, ready to go ahead for 25%-30% below market value - with my own money that I will put on the line, rather than relying on borrowings, so I can proceed straight away.

why would put your own money in? i never put a penny in of my own money ! why would you put say 75k in a property that valued at 100k ie 25%bmv when you could buy three for 25% bmv using the 75k for 3 x deposites ?! on 25%bmv properties or better still buy 120 properties in 2years with none of your own money

northeast1976

GDB2222 wrote: »

So, the rent can go up to full market rental at the end of the first year? And you have no obligation to rent it to her at all after the first year? In reality, she has no security of tenure at all.



If 48% below market value would pay off the mortgage, then surely you are misleading this lady very badly? If she can produce a valuation to show that and an action plan, then I think that it is highly unlikely that a court would order an immediate repossession - so what you have told her about being reposssessed is almost certainly misleading her. If I knew more about the case, I would inform the local Police and let them decide if this fraud.

Better courses of action would be:
The lady would have time to auction her property and get close to 100% of market value. She could then trade down, as a cash buyer.

If she is elderly, she could do a home reversion plan, which would pay off the mortgage and allow her to live there for life without paying any rent at all.

This is a simply dreadful deal for her, and she can only be doing it because she is "desperate, unwary and financially naive". I also think it is possible (judging purely from what you have said above) that you have misled her dreadfully. Somehow you think you will get some sympathy here?

As I said above, I think it may be necessary to have a discount of 25%-30%. However, you appear to be dressing the deal up with hopes of a life-long tenancy in order to obtain a 48% discount. Shame on you for exploiting this lady!



Excellent, but we may have different ideas about what honest means.

ok i never told her or advised her on repossession her solicitor ,CA and mortgage company did that!

does she have security in a word no! but thats the chance she takes i have told her all negitives she can make her own informed choice

why doesnt she sell at auction - simple they are not selling as this property needs 20k to bring it up to a habital standard
also you will find 99% of clients dont want to move and will go to every length not to as family live so near buy

as for the police mmmmmmmmm that line did make me laugh

dressing it up didnt you read my post i painfully tell her she is only on a 12 mth ast and at the end we could evict her , but why would we??!! i also tell her she still has the right up until completion to cancel i always tell clients to speak to freinds and family tell them what is happening

some we do help with advice we give and they manage to remortgage , change to interest only , down size etc etc etc and we walk away from the deal as its for their best interests

i knew if i posted 48% it would cause a stir " if i knew more about the situation" but thats just it you dont!! if you where closer to me i would say come out with me and i will show you how we work and i think you would be shocked how open and honest we are and how much we help the clients

i am sat here at court now and there are 2 others awaiting repossession ones just been in and hes been ordered out!! 3 mortgage payments late!!

northeast1976

GDB2222 wrote: »

So, the rent can go up to full market rental at the end of the first year? And you have no obligation to rent it to her at all after the first year? In reality, she has no security of tenure at all.



If 48% below market value would pay off the mortgage, then surely you are misleading this lady very badly? If she can produce a valuation to show that and an action plan, then I think that it is highly unlikely that a court would order an immediate repossession - so what you have told her about being reposssessed is almost certainly misleading her. If I knew more about the case, I would inform the local Police and let them decide if this fraud.

Better courses of action would be:
The lady would have time to auction her property and get close to 100% of market value. She could then trade down, as a cash buyer.

If she is elderly, she could do a home reversion plan, which would pay off the mortgage and allow her to live there for life without paying any rent at all.

This is a simply dreadful deal for her, and she can only be doing it because she is "desperate, unwary and financially naive". I also think it is possible (judging purely from what you have said above) that you have misled her dreadfully. Somehow you think you will get some sympathy here?

As I said above, I think it may be necessary to have a discount of 25%-30%. However, you appear to be dressing the deal up with hopes of a life-long tenancy in order to obtain a 48% discount. Shame on you for exploiting this lady!



Excellent, but we may have different ideas about what honest means.

ok i never told her or advised her on repossession her solicitor ,CA and mortgage company did that!

does she have security in a word no! but thats the chance she takes i have told her all negitives she can make her own informed choice

why doesnt she sell at auction - simple they are not selling as this property needs 20k to bring it up to a habital standard
also you will find 99% of clients dont want to move and will go to every length not to as family live so near buy

as for the police mmmmmmmmm that line did make me laugh

dressing it up didnt you read my post i painfully tell her she is only on a 12 mth ast and at the end we could evict her , but why would we??!! i also tell her she still has the right up until completion to cancel i always tell clients to speak to freinds and family tell them what is happening

some we do help with advice we give and they manage to remortgage , change to interest only , down size etc etc etc and we walk away from the deal as its for their best interests

i knew if i posted 48% it would cause a stir " if i knew more about the situation" but thats just it you dont!! if you where closer to me i would say come out with me and i will show you how we work and i think you would be shocked how open and honest we are and how much we help the clients

i am sat here at court now and there are 2 others awaiting repossession ones just been in and hes been ordered out!! 3 mortgage payments late!!

also as for the ast side i have had 2 clients still in the same properties since may 2000 (over 8 years)and they are still there no issues i have never as yet evicted any one

GDB2222

northeast1976 wrote: »

ok i never told her or advised her on repossession her solicitor ,CA and mortgage company did that!

does she have security in a word no! but thats the chance she takes i have told her all negitives she can make her own informed choice

why doesnt she sell at auction - simple they are not selling as this property needs 20k to bring it up to a habital standard
also you will find 99% of clients dont want to move and will go to every length not to as family live so near buy

as for the police mmmmmmmmm that line did make me laugh

dressing it up didnt you read my post i painfully tell her she is only on a 12 mth ast and at the end we could evict her , but why would we??!! i also tell her she still has the right up until completion to cancel i always tell clients to speak to freinds and family tell them what is happening

some we do help with advice we give and they manage to remortgage , change to interest only , down size etc etc etc and we walk away from the deal as its for their best interests

i knew if i posted 48% it would cause a stir " if i knew more about the situation" but thats just it you dont!! if you where closer to me i would say come out with me and i will show you how we work and i think you would be shocked how open and honest we are and how much we help the clients

i am sat here at court now and there are 2 others awaiting repossession ones just been in and hes been ordered out!! 3 mortgage payments late!!

How much equity does this lady have in her property?

northeast1976

30-38k AWAITING on RICS

GDB2222

northeast1976 wrote: »

30-38k AWAITING on RICS

So, I'm still unclear about the figures. What are you paying, what's the mortgage, and what do you think the RICS will be?

northeast1976

GDB2222 wrote: »

So, I'm still unclear about the figures. What are you paying, what's the mortgage, and what do you think the RICS will be?

Owes 40k, omv 80k, purchase 42k, RICS MAX 80K

northeast1976

Heres one on many emails i get daily i have left EA contact details so you can confirm

Dear Mr XXXXX(deleted personal details)
this property did not sell on the day of the auction and offers are invited for the property. if you are interested in viewing or offering please call me on 0845 459 7000


Regards Tracy wilson


Tracy Wilson
Sales Consultant
Sarah Mains Auction House
Ref:xxxxxxxx(deleted personal details)



--Forwarded Message Attachment--

Property information for Mr xxxxxx sent on 20/10/2008 by Sarah Mains Auction House, 8 - 10 The Square, Whickham, Newcastle upon Tyne, NE16 4JE - Telephone 0845 459 7000

SWALWELL
Guide: �75,000-�95,000
</I></B>Selling on behalf of Yuil Homes. Offered to the market for sale and benefiting from gas central heating and double glazing. The accommodation briefly comprises of: entrance, lounge, dining room, kitchen, three bedrooms, bathroom. Externally a yard to the rear with off street parking if required.
Ref: xxxxxxx

GDB2222

northeast1976 wrote: »

Owes 40k, omv 80k, purchase 42k, RICS MAX 80K

Surely, if the figures are as you put them, there is a reasonable chance it will sell for say £70k after repossession, so this lady would get the best part of £30k after paying off the mortgage? Instead, she will get £2k from you and a lease for a year at a reduced rent.

You're not just helping this lady. You're a saint!