A month ago I posted: “Can You Rent a Home After Foreclosure?” This post received a significant amount of viewers.
I want to add that in this current rental marketplace, especially here in Reno, any landlord who would not consider foreclosures, would close himself off from a large portion of the possible available tenants.
Anyhow, this is a cheap way of saying that we have a Virginia Foothills home for rent and we will consider foreclosures.
Leave a message if interested.
Bijan Madjlessi is the real estate developer that was arrested because of dual insurance claims because of a fire at the Belvedere towers condo project.
It appears that he had a history of using and abusing people. It seems that not paying his contractors and vendors was his standard practice.
One of these vendors was Chad Empey of Petaluma, CA and it appears that he is fighting back. He has posted videos that explain in detail how Madjlessi ran his operation. This video is only one of many describing Madjlessi, his operation, and the corrupt bankers that enabled this fraud.
http://youtu.be/zhMpSmAS5tA
Another foreclosure proceeding involving MERS was thrown out by a New York appeals court.
In part, the court ruled:
In sum, because MERS was never the lawful holder or assignee of the notes described and identified in the consolidation agreement, the corrected assignment of mortgage is a nullity, and MERS was without authority to assign the power to foreclose to the plaintiff. Consequently, the plaintiff failed to show that it had standing to foreclose.
The ruling does not bode well for MERS, but is clearly not the end, either.
Click here to read the court’s ruling on MERS.
Bijan Madjlessi was/is the owner of the Belvedere Towers condominium project here in Reno and who had neglected to pay his property taxes resulting in the property being seized in a tax foreclosure by Washoe county.
Madjlessi has also been arrested in California for insurance fraud because he filed insurance claims on two separate policies.
Now, it appears that Madjlessi has a very busy man. He is also linked to the failure of the Sonoma Valley Bank that had three branches in the Sonoma Valley area of CA.
When Sonoma Valley Bank granted him a loan he had already defaulted on a loan from IndyMac bank for the same project.
At the center of the bank’s downfall is a series of large loans made to a small group of North Bay developers who were behind three Sonoma County projects that fell into foreclosure over the past few years.
The bank continued to fund the projects even after it became public in land records and lawsuits that the developers were defaulting on multimillion-dollar loans from other banks and were not paying construction contractors.
At this time I am aware of at least two other failed real estate projects. He blamed the bad economy.
Read more here.
A California appeals court granted MERS, (Mortgage Electronic Registration Systems) a legal victory by ruling MERS can launch foreclosure procedures even when it lacks possession of a promissory note.
In its Ferguson v. Avelo Mortgage verdict, the California Second District Court of Appeals refused to accept the plaintiff’s assertion that MERS as nominee of lender lacked possession of the original promissory note. Ferguson argued MERS could not foreclose if it did not hold the note.
Read more on MERS.
Consider this: suppose you were delinquent on you mortgage payments. And suppose the bank was not able to contact you or to find you. Perhaps you have moved and left no forwarding address or phone number.
So, if they were to serve you foreclosure or other papers, how could it be done?
Would you think Facebook?
Think again. It has already happened in Australia.
A couple in Canberra defaulted on a six-figure loan. A lawyer acting for the lender could not trace the couple at their home or via email. So he applied and was granted the right to serve legally binding documents on Facebook.
Read more:
http://www.abc.net.au/worldtoday/content/2008/s2447627.htm
http://www.guardian.co.uk/technology/blog/2008/dec/16/facebook-repossession-australia
Washoe County recently conducted the sale of tax delinquent properties. According to Nevada statutes the properties are placed for sale if the taxes have not been paid for at least three years.
The RGJ reported on the purchase of 92 condominiums by David Lonich, the attorney representing Bijan Madjlessi of Belvedere LLC. Madjlessi planned to market the condos in the Sundowner’s north tower, but the economy and the real estate market soured and he was unable to sell as planned.
The lawyer for the developer of downtown Reno condominiums — converted from rooms in the former Sundowner Hotel and Casino — on Wednesday purchased 92 of the condos for nearly $2 million at auction, after his client was delinquent in paying nearly $800,000 in taxes to the county.
But, here is the part that the RGJ, for whatever reason, did not tell.
The story was related to me by people that had attended the Washoe County Tax sale last week.
Lonich bought all 92 units and experienced little or no competition. Others bid on some of the properties, but were all out bid.
The nature of the tax lien is that it is superior to all other liens. Consequently, when a tax sale is conducted, all other liens are wiped out.
So, what else was wiped out? Since the taxes take precedence over all else, any financing, or mortgage loans were eliminated. According to notices of default totalling approximately $47.9 million, debt in that amount was eliminated, completely. The RGJ reported that the property was purchased for $7.89 million. I’m not clear how debt could grow to 47.9 million. Nevertheless, it would appear the banks lost, big time.
Likewise, public records showed a total of 359 liens had been filed against Belvedere LLC and the property. Some of these liens may have been satisfied, but this has not been verified. A total of 771 documents have been recorded associated with Belvedere LLC and I have not reviewed all of them. These liens have all been completely wiped out by the tax foreclosure. Each of these liens represents someone that Belvedere LLC owed money, and each was left holding the bag.
Contractors didn’t get paid. Vendors didn’t get paid. The HOA didn’t get paid. and even the City of Reno didn’t get paid.
Now, I believe that some of these liens may have been satisfied because some of the units may have been sold but this has not been verified. Therefore the total numbers may vary a bit, but this is still close.
And what did Madjlessi lose? You may be surprised to learn that he fared a bit better than his associates, the banks and the contractors and vendors. He was able to eliminate $47.9 million
in debt for a mere $2 million and he got a lot of his building upgrades for free.
It’s nice work if you can get it.
According to RealtyTrac, Nevada led the U.S. in foreclosures for 52 months in a row. Foreclosures jumped by 23% to an all time high.
One out of 97 homes received a foreclosure notice in the month of April.
The Las Vegas area was number one or the nation’s cities with one out of 82 homes.
And even though the foreclosures were up, the number of filings has decreased significantly.
Reno-Sparks was ranked No. 9 in the nation with one filing for every 183 households.
Read here for more foreclosure information.
A federal judge in Oregon ruled against MERS, the Mortgage Electronic Registration System, in a foreclosure case and delivered a potential setback to the mortgage industry’s electronic lien-registry system.
Theories exist that one purpose for the existence of MERS is to avoid paying the recording fees to the various county recorders. By Using MERS, banks have avoided millions, and possibly more in recording fees.
The homeowners in this case were clearly in default. They hadn’t made a payment since 2009.
Oregon law, like that in Nevada, allows for non-judicial foreclosures. The provisions, however, are that any transfer of ownership of the liens and the documents must be properly recorded in the local county.
The banks and MERS apparently didn’t think the rules were important enough to follow. Sometimes, I think it is a calculated risk. They are going to get caught once in a while, but the rest of the time it is worth while.
In this case, the banks and MERS got caught. There were significant gaps in the chain of title. Also, three separate documents were recorded, signed by three separate vice presidents of MERS, and each notarized by the same notary.
Read the rest here and here for the original ruling. (notice that some of the links did not work for me every time even though the url was identical, but I was able to find the documents in question. My only explanation is that it must be magic??? Iaf you still have problems, contact me and I’ll try to help.)
REReno recently had a story about Coldwell Banker Mortgage getting slapped down by a Federal court jury.
A federal court jury awarded David Brash, a soldier at Fort Benning, GA more than $20 million on Monday in a case against Coldwell Banker Mortgage.
It seems, however, that the banks have not yet learned their lessons.
Units of Bank of America Corp. and Morgan Stanley have agreed to pay more than $22 million to settle charges that they improperly foreclosed on active-duty members of the U.S. military, the Justice Department said Thursday.
The Bank of America unit, which was part of Countrywide Financial, will pay $20 million to resolve allegations it foreclosed on the homes of about 160 service members between January 2006 and May 2009 without court orders, the Justice Department said.
Saxon Mortgage Services Inc., part of Morgan Stanley, will pay $2.35 million to resolve allegations that it did the same to about 17 service members between January 2006 and June 2009, the government said.
Read more.