Working My Way Through Potential Fraud - Bad Lend

[Thomas S.]

Good morning all,

I have been doing gap lending for a few years to a fairly local LLC. They did a few successful flips and paid me according to the contract we drafted, which was good.

I have two houses I lent for (promissory note, unsecured) that are in breach of contract and have sold but I have not been paid. The group is ignoring my requests for more granular information on the flips, and the stuff they sent me originally is flat out wrong (even the amount I lent). They also have refused to meet me in person.

I write today to gather as much advice as possible. Looking back, I wouldn't lend without securing the loan, but I was 18 at the time I started this. The total is about $50,000.

I appreciate any help you can lend. Thank you.

[Tom Gimer]

This is a dispute between lender and borrower. Period.

Suing the new owner and/or involving a title insurer (there is no insured in this scenario that can make a title claim) is a waste of resources.

Lesson learned = unsecured loans by definition have no security. At least add a confession of judgment provision to the note if you're going to lend like this.