Investment Condo Mess

[thegoat]

Hope I can get some get solid advice here.

I bought a condo about 3 years ago in Tampa...from a large condo conversion developer who I will not name but Im sure as heck that as attorneys in Florida you will know who Im speaking of.

Guess I dont have to tell you Im upside down and although not behind in any payments/taxes or association fees, Im becoming broke from doing this. I have an ARM thats over 8% and will adjust in 2 years. It's killing me now, forget about 2 years from now.

This is a condo conversion INVESTMENT property so Im sure the rules are different when looking for help from a bank. But Im sure that between the developer of this 5 year old conversion, the realtor that sold me the property (not the developer) and the mortgage broker that I was told to use or I would not get incentives and is out of business....there was collusion. I sure as heck know that there are big time inaccuracies and indiscretions all over this transaction.

Ive read that this large developer is in financial trouble now and is also being investigated by the feds for their scheming and sales practices. They have also changed their name to some type of clearing house for foreclosures.

I had a Forensic Audit performed but he really did not come up with anything concrete except for the fact that the salesperson made guarantees on his/her website as to the appreciation of the property and treated this as a pure investment rather than a real estate transaction. Im considering another forensic audit by someone that will possibly see something that is being overlooked.

Ive contacted an attorney and he is attempting to send demands to all of them with the hope of a recission or a settlement.

My credit is perfect (740) and I dont want to go under or do a DIL as I was naive and stupid enough to believe that this "investment" would pan out the way it was proposed, never realizing in retrospect that 11/06 the market was already on a downswing yet the realtor kept sending me proposal of how I will own this for free for the first year and after 3 years see outstanding appreciation.

I realized that principal reductions are almost impossible, especially for an investment property, but even a loan mod down to a couple of percent for a few years would reduce my burden until the market comes back (if).

A stupid move on my part, yes...but I believe the transaction was unethical and full of criminal intent.

Any advice......please.

[Marshall Rosenbach Esq.]

Goat - I think your lawyer is doing the right thing! I assume he/she is seeking a settlement and to rescind based on fraud, as opposed to TILA. But the reality is, how much money are you going to get out of the broker and others out of business? To me, chasing non-collectible people is an exercise in futility, but I am sure your lawyer is very competent and knows exactly what he/she is doing. I think you want a loan modification and it should be based on the fact you were a victim of fraud as well your hardship (that you cannot afford the 8% payment, assuming that is true). Good luck with it.

[thegoat]

Thanks so much for the quick response!

Let me ask you, the fact that this is an investment, rather than owner occupied, will I the bank still consider a loan mod?

Im really going for that second audit as I believe the first one does not hit the real substance.

If I could get a loan mod if my other pursuit does not allow it, I will still be in the hole but at least it would be affordable.

[Marshall Rosenbach Esq.]

I think you should try for a modification on the 1st, even if it is an investment loan. Another option may be to try to settle the 2nd mortgage for a small percentage of the full amount although of course the holder of the note will make the final decision obviously. You'll never know unless you try.

[thegoat]

There is only one mortgage...what I had meant to say was that I wasnt satisfied with the first Forensic Audit I had completed because the auditor said there was nothing material except for the manner in which the sale took place.

I believe my attorney had mentioned something about going for the loan mod at the same time he is pursuing the other area of resolve.

Hopefully I understood that you feel that he should be going for the loan mod first but I want to put in his hands as much ammunition as possible...the reason for the new Forensice Audit by someone who will dig deeper.

Thanks!

[Marshall Rosenbach Esq.]

I'm sure your attorney is doing the right thing. I haven't seen anything about your specifics so I really can't say anything. My practice is to try to get a loan modification as soon as possible while the other issues are pending. But again, your lawyer I'm sure has it all under control.

[thegoat]

I have an investor loan with Aurora taken out in 11/06. Besides paying the mortgage broker a hefty fee on this disgraceful mortgage, I am also being charge about 1.5 YSP which only showed on the HUD.

Should I have not been disclosed earlier that I was going to be charged this fee only for the lender to charge me a higher interest rate?

Where I believe the loan has predatory earmarkings, I would like to get this determined as to whether or not I should have had the opportunity of being aware that my lender was paying the broker the YSP from viewing the HUD one day prior to closing.

Also, is this a flagrant violation?

Any info is appreciated as I contemplating loan mod now.

[thegoat]

The last page of the HUD reads:

"After closing, Lehman Brothera may pay to the broker additional compensation up to 125% of the loan amount for services rendered"

Again, what kind of crap is this that they are informing me on page 4, last page of the HUD that they can pay the broker this fee ?

Is this predatory?...I don't even know who to ask about this anymore.

Thanks!