All Forum Posts by: Brian Burke

I had one rental house and one rental condo. Sold them both and did a 1031 exchange into a 16-unit complex. That got me hooked on multifamily. That was over a decade ago. Hundreds of units later, still growing!

Grrr...hit post too soon...continued...

I have to disagree. Here is what judges have to say:

There is a twin purpose of the non-judicial foreclosure sale statutes: 1. that a properly conducted sale be a final adjudication of the rights of the creditor and debtor and 2. the sanctity of title of a bona fide purchaser be protected (Melendrez v. D&I Investment, Inc (2005) 127 Cal.App.4th 1238, 1256)

Ok, so far this supports your position, but...

"...when there is a defect in the foreclosure which is discovered before the trustee's deed is delivered to the purchaser, there is no deed which creates the conclusive presumption of validity in favor of a bona fide purchaser. Therefore, if a defect in the foreclosure process is discovered after the trustee has accepted a bid, but prior to the delivery of the trustee's sale, the trustee can abort the sale, return any funds received to the purchaser, plus interest, and process another foreclosure." (Angell v. Superior Court (1999) 73 Cal.App.4th 691, 86)

So...this has already been litigated. Yes, the TITLE of a BFP is protected, but no deed = no title to protect. Thus, trustees can give the money back (with interest) and they are off the hook, as long as they haven't delivered the deed. Once you have recorded your deed, it's a different story. Now you own the house and they can't take it without compensation.

Ask me how I know all of this...this is about $90K in legal fees summarized in a couple of paragraphs. :)

Recissions after the auction aren't all that uncommon. There are a variety of reasons, such as last-minute bankruptcy, error in following the procedure, temporary restraining order that was granted but not delivered until too late, etc.

F Foster, the civil code governing foreclosure in California is 2924 et seq. There are many references in the various subsections that provide protections to a bona fide purchaser for value.

K. Marie Poe, I'm interested in the civil code section and case law that you mentioned that support your statement "In CA, per civil code, if you are a bonafide purchaser at trustee's sale then the sale is valid. The code is clear that there is no allowance for rescission, regardless of irregularities of sale or mistakes by the trustee or lender. Case law upholds this."

Thanks Joffrey. I couldn't agree more, but here is what I see: the 12% guy has a deal blow up, then he either says that Private Lending is too risky to continue, or uses it to justify why he needs such a high rate. Self-fulfilling prophesy. Rinse. Repeat.

Sweet! Way to go, Brandon!!

I once bought a property at a foreclosure auction, and subsequently contacted the occupant to discuss her "transition from occupancy". She told me that she stopped paying the mortgage because she would rather lose it in foreclosure than allow her estranged (and jailed) husband to receive anything from it. She then offered me around $100K more than I bought it for (not a million $ house, this place was more like 3 hundred grand). And actually closed on it!! That was 15 years ago, and 500 houses later it hasn't happened again.

Welcome to BP, Julie! I'm way out here in CA but I own a little 11-unit building in the Elmwood Village. It's a great neighborhood. Does that entitle me to say "Hello neighbor!"?

I don't know how I ever lived without it! I use mine to read and post on the BP forums. Too bad, @Steven Del Prete, that "@ mentions" don't work from it!!

It's great for web browsing and email, and of course the tons of apps, which are somewhat useful, but web & email dominate my usage. My favorite app is probably Dropbox. Synchs my files between my office computer and home office computer and laptop, and makes them available on iPhone and iPad. Awesome.

@Mark Bodinger, Berkshire bought Hendricks & Partners, which is a Multifamily brokerage. Don't expect to see them buying houses any time soon, or ever, within this merger.

@Jerry Kisasonak, you get in touch with these groups by finding the local real estate agents that are representing them. They have gone out to each market and identified a few agents to be their "buyers agents" and scout for property. For me, it was pretty easy to find them because they found me. It started by noticing who was writing offers for them on my flips, then it progressed to getting phone calls from them asking to buy anything and everything I have.

Call a couple of REO agents in your area and ask them who is writing offers on their listings. Chances are they will be well aware of who the players are. I wouldn't bother trying to call the hedge funds directly, unless you own a large portfolio of homes you want to sell, they won't want to talk to you...they'll direct you to talk to their agent if you can get them on the phone at all.

Everything that I buy that makes sense to hold as a rental, I hold. Everything that doesn't make sense to hold as a rental, I flip. What's funny is that about 30% of my flip inventory over the last few months has been bought by hedge funds. They don't make sense to hold at my wholesale price, so how they make any sense at all at my retail price is beyond comprehension. Essentially, these groups are going long on RE valuation, not seeking yield.

I wouldn't worry about spending a lot of time looking for them. In several months, institutional acquisition of single-family will be a distant memory, shelved in the dust next to the hula hoop and Rubicks Cube. It's a great strategy when done right, but I for one will likely be done acquiring in volume within 18 to 24 months. I suspect others will do the same.

I'm no lawyer but its my opinion that CC&Rs apply to parcels who's owners signed them. If that property (or properties) is subdivided, the subdivided parcels would be subject to the CC&Rs. Adjoining parcels are not subject to CC&Rs unless those adjoining landowners also agree. Once instituted, the CC&Rs run with the land.

Now I begin my educated guess...I suspect that CC&Rs can be modified or eliminated if all current landowners that are subject to them agree to do so. I wouldn't think that you would need the originator of the CC&Rs, just current owners. Here's the catch: what happens if only SOME of the current owners agree? Can they be modified or eliminated by a majority? Good question for the attorney...

As to your question of who gets to interpret the CC&Rs, I think this one is easy: the courts.

Nevertheless, I think a door to door or letter campaign is in your future.