Fast cash in foreclosures- is this a scam?

Question

ok, here is the scenerio: a person is in foreclosure and risk losing their home, you put them under a contract for ($1-$500) and say you will buy it from them- but you dont! You then find an investor or someone else willing to buy the house and you give them the house if you get a finders fee from them. The finders fee can be anywhere from 1k-20k. The catch is, since you have them under contract, you get first dibbs on the house- but you turn it over to someone else for a small fee.

This sounds like a scam and I would like some feedback from someone who has very good knowledge of Real Estate.


Here is the link to the website -->http://www.fastcashinrealestateforeclosures.com/main.htm


Thanks!

i looked the company up on BBB and nothing comes up, but i'm not sure i submitted the search correctly.

Answer 1

I did a quick bit of checking on the fellow that runs this program, and while I found several sites with glowing recommendations (and suspiciously similar wording) it appears that not all of his clients are happy with what they received.

One site said:

"Anyone thinking of buying a real estate foreclosure course or ebook from "fast cash" Steve Maletos should first flush a hundred bucks down their toilet - just to get used to the feeling of losing your money to a thief."

http://www.creonline.com/wwwboard2/messages/44076.html

Mr. Maletos is apparently rather web-savvy, and has gotten his name into several discussion groups, but I can't find anything credible that recommends his program.

It sounds a bit like the idea is to option the property by convincing the owner that you are going to buy it and keep it out of foreclosure (preventing the owner from selling it himself), then seeing if you can find a buyer for a higher price. (Essentially, you mislead and lie to a desparate seller.)

If you can, then you buy the property and flip it. If not, then you back out at the last second, leaving the property owner with a worthless piece of paper and no time to find another buyer.

This is the sort of thing that gives real estate agents a bad name, as I doubt that most sellers would realize that an honest, ethical agent would never play that game.

Additionally, every state's laws regarding real estate agency are different, and it seems possible that the authorities might decide that you are acting as a real estate agent without a license or the required training and insurance.

And we Realtors, through our various state organizations, have been pretty successful at lobbying for strict laws and heavy penalties in this area. It's not that hard to get a license in most states (not nearly hard enough, in my opinion. In my state (WA) you need more training to cut hair than to sell real estate), so the authorities have little sympathy for folks caught acting as unlicensed real estate salespeople.

I suppose this "system" could be successful providing you have no qualms about lying to people who are trying to protect their credit or skirting the real estate licensing laws. Hopefully, that doesn't describe you.

Of course, if it does, you have my most fervent hope that you lose every dime, and find yourself living under a bridge after spending some time in the "Crossed Bars" Hotel.

Answer 2

This is a very common practice with investors. Once an investor (or anyone for that matter) gets a home under contract, that buyer may assign the contract to another person (buyer) for a fee. Nothing illegal about it unless the contract does not allow for assignments.

Answer 3

Well first off, if you are selling a home without actually owning it, and you don't have a real estate license, you are committing fraud. Secondly, its better to invest in foreclosures directly or buying tax deeds and flipping it. Don't believe in web sites that are potentially hazardous for you and/or illegal. I suggest you pick up a book like Complete Guide to Real Estate Tax Liens and Foreclosure Deeds: Learn in 7 Days [ISBN 0978834682] by Don Sausa from Amazon or Barnes & Noble.

Read how to re-sell properties legally and how to get tax deeds/tax liens without a real estate license.

Answer 4

Here is a good rule of thumb for when opportunities like this one presents it's self:

Do you know of anyone else that is doing it? If not then it probably can't be done.

What you are talking about specifically is done all-day, every day. The people who do it are called Realtors. What you are talking about is a loop-hole to circumvent licensing. You are looking at getting yourself in a world of hurt.

Answer 5

no i don't think it is if u owned that house or finance the house and they signed a contract but i hope u have a license because thats the only way u can do that. after they lose that house u can get someone else to pick up the payments but they have to make sure there going to keep it because u can't keep forclose on house to many times.

Answer 6

It's not necessarily a scam, but it surely is not as simple as this dude is trying to make it sound.

If this is this simple, why is this guy selling a system instead of doing this himself? Rest assured that most of the profit generated by this system goes to the guy selling the system. Save your money.

Answer 7

I highly suggest that you do NOT do this. There are soon going to be affidavits that the Seller and Buyer will have to sign at the time of closing in regards to this. This is illegal as to my understanding.

Answer 8

If you are going to have someone under contract you better have a state license!

Answer 9

It's a scam.