All Forum Posts by: Account Closed
Account Closed has started 1 posts and replied 7 times.
Great to read all this. We were not prepared to handle the bad side of this and from what we are reading they have us over a barrel. But we live and learn. I’m not giving up yet, I am hoping they have a conscience and want to make this right. Again I appreciate the advice and would love to visit in the future.
Quote from @Jeff S.:
What do you mean by, “I had my attorney draw up a contract,” @Account Closed? A well-prepared set of loan documents will include a note and deed of trust or mortgage (state dependent), personal guarantee, 1003 to disclose assets, use of loan proceeds statement, lenders title insurance, a fire and hazard insurance policy, comps/appraisal/BPO, and many other disclosures and assorted documents. Is this what your attorney prepared or arranged?
Most notably, the deed of trust or mortgage will be recorded. This is your security and liens the property so it cannot be transferred until the loan is satisfied. It also gives you the right to foreclose. A note alone is nothing more than an IOU and worthless on its own. You cannot “foreclose on the note,” as stated above, but can sue for a judgment in court, at best. Then what?
Even if it were offered now (it won't be), taking over an LLC is a landmine. You'll have no idea what liens, lawsuits, or other skeletons are hidden in that closet.
Quit speaking to the borrower. It’s clear that nothing good will come of it. Find a decent lending attorney who can review your paperwork and explain your options. It’s likely your next communication will be a demand letter detailing the amount owed. Or instead, if there is a recorded lien and personal guarantee, you’ll quickly get your borrower's attention by sending a Notice of Intent to Foreclose and referencing his name on the personal guarantee. I hope these documents exist, Curtis, but I really fear you directed an unknowledgeable attorney to give you some lousy legal advice. You might explain.
Thank you for the advice. Sounds like my attorney will be my first call in the morning. From reading through all the threads it appears that we messed up, plain and simple. I appreciate everyone’s input!!!
Quote from @Danny Polanski:
You could go online and make a formal complaint with your state’s attorney general.
It’s free and they will follow up regarding fraud.
Quote from @Randall Alan:
Quote from @Account Closed:
Quote from @Randall Alan:
@Account Closed
If you had a lawyer involved, I presume you have a lien on the property in question? You should be able to foreclose on the note if they stopped paying and take over the project. That's where my head goes.
Randy
I have not started on the lien process. But I did not realize you could foreclose on the note. That’s good information, thank you.
If there was no lien signed before you gave them the money they certainly aren’t going to sign one now. If there is no lien your attorney should be fired!
Randy
@Account Closed
Well crap… thanks again for the info.
Quote from @Theresa Harris:
You hired a lawyer, they should be able to tell you what do it.
Thanks Theresa, just hoping the community had delt with this before and had some ideas outside of legal options. Appreciate your input.
Quote from @Randall Alan:
@Account Closed
If you had a lawyer involved, I presume you have a lien on the property in question? You should be able to foreclose on the note if they stopped paying and take over the project. That's where my head goes.
Randy
I have not started on the lien process. But I did not realize you could foreclose on the note. That’s good information, thank you.
My wife and I are in the rental market and we were looking to expand our portfolio. Last January I met a flipper and we began to visit about their business. We talked multiple times over the next few months. In March of last year my wife and I loaned them 50k for a flip or a fix and rent triplex, we left it up to them, we just wanted to be the lender. It was a 6 month note, I had my attorney draw up a contract. Everything clipped along great and September rolled around and the market changed in the area they were buying houses in. As I said we are in the business so we understood. We have worked with them, being patient and following up. Obviously following up more the later past the due date we get (making contact once a week). 5 months past due, the person won’t return my calls, will respond to my calls in text occasionally. The excuse is that they have meetings from 5am to midnight everyday trying to get us paid back. Now, this morning after another another call, I politely tell this person that we need to get paid and we need to keep the line of communication open and if your not willing to talk to me then I will let you talk to my attorney. So ensued the blow up. The said person sent a rather rough text telling us that this was not their fault and they are doing all they can. It was also added that we should be grateful that they are even attempting to pay us back when they could have just said f*** it and never attempted the repay the debt. Now that you know the story, are there other routes , other than legal, that I should look into. Thanks for some out of the box ideas.