A petty crook in Montana tried to steal real estate owned by a bank. He's not much different than many participants in the housing market here in California. His real crime was failing to fill out a mortgage loan application first.
Somewhere high in the desert near a curtain of blue A sane man skirts under the wind But down here in the city of limelights The fans of Santa Ana are withering And you can't deny the living is easy If you never look behind the scenery
Real estate is religion in California. Home price appreciation is the one area where all Californians share the same faith. Faith in the ability of their fellow man to push prices ever higher. Faith in lenders to provide an endless pool of borrowed money. Faith in lenders not to foreclose when they decide to quit paying their mortgages.
Borrowers everywhere are not paying their mortgages and squatting. These people signed loan documents promising to repay a loan which prompted a bank to buy a house for the borrower and allow them to occupy it. Right now, the borrowers are living in that house, they are not making their promised payments, and the bank is not exercising it's right to call a public auction and force them out.
Historically, squatters have lived in houses they were not paying for just as the delinquent borrowers are doing today. In the past, squatters simply moved in and skipped the step where they sign loan documents and get the bank to buy the house for them. Today's squatters added the participation of the lender, but the end result is the same: people are living in houses they do not own and they are not paying for them either through rent or through repayment of a home loan.
I find it ironic that people who squat with traditional methods are being arrested whereas those who squat with permission of the bank are being assisted by our own government. With a little creativity, one squatter has taken possession of a number of properties, attempted to get HELOC money, and rented one of them out for a positive cashflow -- very positive considering he didn't pay for it. Although he is a criminal being prosecuted, he isn't much different than the thousands of California squatters and land barons operating across California. I will let you decide whose theft is more sophisticated.
Wilson convicted of stealing Montana house by removing ‘for sale’ signs, changing locks
7/14/2010 10:07:16 AM ET
POLSON, Mont. — A Lake County jury convicted a transient of stealing a house in foreclosure by removing "for sale" signs, changing the locks and filing strange paperwork with the county claiming he purchased the house from Yahweh.
Stealing a house by filing strange paperwork? Isn't that what every liar loan applicant did during the housing bubble? People all over California filled out strange paperwork full of half-truths and outright lies about their income. We sold homes to transients and anyone else with a pulse. I'm sure many of those buyers thought it was a gift from God. Why should this guy be jailed for it if we are letting slide all those other people here in California who did the same thing?
Jurors deliberated for less than an hour Tuesday morning before convicting Brent Arthur Wilson of theft, deceptive practices and tampering with public records or information. He faces up to 30 years in prison when he is sentenced Aug. 19.
The professor under whom I first studied real estate law also taught a course at the nearby penitentiary. He relayed the story of one convict who forged the signature of the previous owner on a purchase and sale agreement deeding the property to the criminal, and then the criminal recorded it. For anyone doing a title search, the criminal would have looked like the legal owner because he was present in an unbroken chain of title.
The fool in Montana made the mistake of purchasing the house from Yahweh who did not appear on the chain of title. Perhaps he can argue all property rights come from God, but unless God is on title, He does not own the property.
Wilson was charged in February after Polson real estate agent Ed McCurdy investigated the removal of "for sale" signs from a $380,000 house he was selling on behalf of a lender in August 2009.
Further investigation found Wilson tried to use the house as collateral for a $125,000 loan he sought from a Missoula financial institution.
I love this guy. He buys the home from God and immediate applies for a HELOC. His mistake was doing this in Montana where it stands out as unusual. If he had pulled this trick in California, we would have been viewed as just another homeowner.
Prosecutor Jessica Cole-Hodgkinson told the jury Monday that authorities found journals belonging to Wilson that detailed a plan to steal up to 100 homes in foreclosure.
It would be more accurate to say the guy had plans to acquire 100 homes just like California land barons. He was thinking like a land baron. Many people during the real estate bubble acquired multiple properties using liar loans, 100% financing and Option ARMs. Since these "legal" land barons lied on loan applications, didn't put any of their own money into the deal, didn't make payments that covered the interest on the debt, and walked away when the investment went bad, it is difficult to distinguish the their behavior from the lunatic in Montana. Land Barons did this because they believed prices would go up, and they would get HELOCs to fuel unlimited consumer spending. I don't see where this guy in Montana's thinking is out of the ordinary.
Cole-Hodgkinson asked Lake County sheriff's detective Rick Lenz to read several entries from journals.
"The prospect of claiming and fulfilling my 100-title vision is growing stronger," read one. "Took down one of two Realtor signs," says another entry. "The other needs a tool to dig it up."
Everyone should have such a strong vision of their future. I imagine people forming funds to buy real estate (not that I would know anything about that) have vision boards with hundreds of properties representing their real estate empire. This kind of creative visualization is a powerful tool. This guy should be complimented as a visionary.
Many of the journal entries appear to be addressed to "the creator, Yahweh."
Don't others pray for their dreams to come true? This guy did more than just pray -- he took action. He did more than most when presented with a great opportunity. He should be commended as a role model.
"Wow. You surely have blessed me with some wonderful opportunities," Lenz read from the journals, which referred to a property with a "million-dollar value" that "seems to be waiting for me to claim it. Wow on wow."
This guy should have walked around some of the bubble subdivisions in California. There are opportunities everywhere with so many vacant homes, many of which lenders don't keep good track of.
Wilson refused attempts by District Judge Kim Christopher to appoint legal counsel for him. He didn't participate in his trial and offered no defense. He read from an IRS document Monday and was reading the Bible during Tuesday's court session.
Authorities have said they believe Wilson tried to claim ownership of at least two more houses, one he was living in and one he was renting out, but he has not been charged in those cases.
So he purloined a property and rented it out. That is very common here in California among delinquent land barons. There are thousands of properties where a renter is paying a land baron who is not paying their mortgage. As long as the property was owned for more than one year, it isn't classified as rent skimming despite the fact it looks a great deal like theft. With banks refusing to foreclose, renters are undoubtedly aiding theft by land barons everywhere.
A court-ordered mental health evaluation found Wilson fit to stand trial.
There shouldn't be any question about his sanity. If we were to find this man insane, we would have to lock up most of the kool-aid intoxicated fools here in California whose religion is real estate. They are just as insane, just as crooked as this nut in Montana, but we don't think twice about their transgressions.
When you boil this case down to its essence, there is only one difference between this guy who blatantly stole the property from the bank and hundreds of thousands of similar thieves here in California: he didn't sign a loan document. That is really the only difference.
If this Montana man had gone through a loan process and obtained bank approval, he could keep the house he did not pay for just as the plethora of squatters are doing all over the nation. The only real distinction between this insane man and the pitiful masses squatting in their McMansions is the process they went through to obtain the property. At least this guy has the defense of being insane. The masses of squatters are just thieves with no defense. They were calculating and sane -- unless you consider kool aid intoxication as a form of mass insanity, and you think their debts should be forgiven.
These people squatted a long time
This property was purchased on 5/29/203 for $475,000. The owners used a $322,700 first mortgage, a $100,000 second mortgage, and a $52,300 down payment.
On 2/3/2005 they refinanced with a $623,000 first mortgage from Ameriquest.
On 3/16/2006 they were given a $100,000 HELOC by Wells Fargo. Since the first and second mortgages were from different lenders, the first mortgage holder had no problem blowing out Wells Fargo -- after a long period of squatting.
Total squatting time is at least 27 months.
Foreclosure Record Recording Date: 03/03/2010 Document Type: Notice of Sale
Foreclosure Record Recording Date: 11/30/2009 Document Type: Notice of Default
Foreclosure Record Recording Date: 02/19/2009 Document Type: Notice of Rescission
Foreclosure Record Recording Date: 11/14/2008 Document Type: Notice of Sale
Foreclosure Record Recording Date: 08/06/2008 Document Type: Notice of Default
This looks like a failed loan modification, so the US taxpayer will end up paying for the loss.
Of course, the taxpayer's loss is a flipper's gain. The house was purchased for $610,500 at auction, and after some renovation work, it is being offered for $749,000. With as ridiculous as the price is, with 4.61% interest rates, the monthly cost of ownership of $2,671 is near rental parity.
Home Purchase Price … $610,500 Home Purchase Date .... 3/23/2010
Net Gain (Loss) .......... $93,560 Percent Change .......... 15.3% Annual Appreciation … 62.9%
Cost of Ownership ------------------------------------------------- $749,000 .......... Asking Price $149,800 .......... 20% Down Conventional 4.61% ............... Mortgage Interest Rate $599,200 .......... 30-Year Mortgage $148,276 .......... Income Requirement
$3,075 .......... Monthly Mortgage Payment
$649 .......... Property Tax $0 .......... Special Taxes and Levies (Mello Roos) $62 .......... Homeowners Insurance $43 .......... Homeowners Association Fees ============================================ $3,830 .......... Monthly Cash Outlays
-$738 .......... Tax Savings (% of Interest and Property Tax) -$773 .......... Equity Hidden in Payment $259 .......... Lost Income to Down Payment (net of taxes) $94 .......... Maintenance and Replacement Reserves ============================================ $2,671 .......... Monthly Cost of Ownership
Cash Acquisition Demands ------------------------------------------------------------------------------ $7,490 .......... Furnishing and Move In @1% $7,490 .......... Closing Costs @1% $5,992 ............ Interest Points @1% of Loan $149,800 .......... Down Payment ============================================ $170,772 .......... Total Cash Costs $40,900 ............ Emergency Cash Reserves ============================================ $211,672 .......... Total Savings Needed
Property Details for 14541 GUAMA Ave Irvine, CA 92606 ------------------------------------------------------------------------------ Beds: 4 Baths: 1 full 2 part baths Home size: 2,327 sq ft ($322 / sq ft) Lot Size: 5,000 sq ft Year Built: 1971 Days on Market: 64 Listing Updated: 40338 MLS Number: S616253 Property Type: Single Family, Residential Community: Walnut Tract: Cp ------------------------------------------------------------------------------
Gorgeous remodeled home in College Park. Four bedrooms & one spacious bonus room. Recessed lights throughout. Crown moldings & ceiling fans. Granite countertop & stainless steel appliance. Pre-wired surround sound speakers in family room. Newly-built fireplace with BBQ in the backyard. Within walking distance of school & park.
Flip with moderate profits... maybe
The renovation on this property looks extensive. After they lower the price to sell it and pay commissions and renovation costs, the flipper will likely make 6%-8% on the deal. Not bad, but not great. It doesn't look like they will get their asking price as it has been active for over 60 days without a price reduction.
IMO, they overpaid at auction. The opening bid was $510,000, and it was bid up $100,500. With comps closer to $710,000, it shouldn't have been bid up quite so high. The flipper as probably expecting a massive spring rally to make an extra 5%. It isn't happening for him.
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