Apologies - Posted by Bill Gatten

Real Estate Investing Real Estate Law
21

Just another…um…note… - Posted by Bill Gatten

Posted by Bill Gatten on September 02, 2001 at 18:13:45:

:? I am surprised at the rather emotional nature of your post and some of the personal remarks.

Jim, my personal remarks were not nearly as potentially incendiary as yours?they were at least as candid and honest. I haven?t built any calluses?I?m just plain ol? opinionated Bill.

:?Sorry you found that opinion uncomfortable.

I didn?t see an opinion; I saw a series of clearly declarative statements

:?I would also like to acknowledge that evidently I misread your post to say that your investor friend had said that the PacTrust would not have kept him out of prison. I stand corrected. Yours and his opinion is that the PacTrust might have been helpful in keeping him from being ?charged? to begin with.

?Might have? is the operative phrase here.

:? without a full reading of the transcript of this case, none of us have all of the FACTS.

What facts?? The guy made a mistake and paid for it. He didn?t mean to. He just got caught up in the burgeoning economy that bankrupted millions of us across the country, and was not ready for the down-turn when it hit. His intentions were never to hurt anyone (he was a hero to the sellers and the lenders when he took over the debt on millions of dollars worth of loans that would (might) otherwise have ended in foreclosure or short-sales at the time.

:?You?ve drawn the conclusion that the PacTrust would have helped his situation. I?m reluctant to draw that conclusion because I don?t know the facts Bill.

What conclusion?? I haven?t drawn any conclusion that doesn?t involve the terms ?possibly,? ?maybe,? ?might? or ?probably? (the latter of which merely means a strong ?maybe?). I don?t know that the PACTrust would have saved him. He said that: I merely repeated it (and I do have a video of the conversation if you need it?his image and voice are distorted of course?)

:?I think we all need to be accountable for our actions?

16 months in the jug, a lifetime of regret and being referred to as a ?convict? by people who don’t have the time or inclination to researdh the facts is not accountability? And I presume, Jim, that I have not been so accountable either?? I?m willing to be sued to the teeth for what I believe and teach?got any other gurus (not my term) out there who are so sure of the invincibility of their programs?

:? YOU posted the message that Roger later posted. Roger simply posted your exact words. I don?t have a clue WHY you posted it?but I have read the thread it was in?you posted it to prove a point?and in my opinion the context is intact.

Jim you surprise me. You’re too articulte for that logic trick. When Bill Clinton said ?I didn?t - - - -that woman,? the statement would still be intact if inserted following a question about Hillary: but the context would none the less be a bit askew. Wouldn?t it? (?Unless fairly followed by the word ?lately,? of course)

:?? like some ?crazy? has distorted your words. He didn?t, they?re verbatim.

See my previous paragraph. They no longer were my words, they were his words, taken from something I said in a wholly disparate conversation for a wholly different reason.

:?Now let me stop here and just say that I think the PacTrust is a slick vehicle for a variety of reasons.

And when that word ?slick? was applied to Bill Clinton by Rush Limbaugh, you don?t feel that the term might have been intended to be less than an impartial, direct attack on the man?s credibility (right or wrong)? Words are volatile things Jim. I?d rather have a knife jammed up my a–, than certain words.

:?But brace yourself Bill

YOU brace YOURSELF, Buddy?I?m gonna start grazing.

:?At times it almost seems that you would claim that the PacTrust takes care of EVERYTHING.

Again. Operative word: ?Seems.? That?s your own interpretation of why post here. I don?t post here to sell products; my banner tries to do that. The reason it ?seems? this way to you is because, there just are not many negative scenarios in creative financing that the PACTrust won?t help, alleviate, ameliorate (llok it up) or eliminate. THAT?s why it was created, and THAT?s what I?m trying to say in the face of a flood of denil and conservatism. Make a list of ten potential negatives in any creative financing vehicle and I?ll bet I can either eliminate them or neutralize them with the PACTrust. The one?s I cant eliminate but can probably neutralize or ameliorate are: potential for tenant damage, non-payment, midnight bail-out, decline in the economy or the RE market, and a tenant?s or trustee?s disregard for the law.

:?Headache anyone? Take the PacTrust pill and get rid of it.

Now you?re beginning to get it! Good for you.

:?And Bill, these latest threads were more of the same. Look at the essence: A guy you know goes to prison because of his real estate dealing under charges of mail fraud (that?s my understanding at least), and YOU claim that had he done the PacTrust he wouldn?t have because they wouldn?t have charged him.

Jim, if that?s not a accidental mistatement, it?s another cheap ?shot.? I did not say that?I said May Not, Might not, Possibly Not, Probably Not? I don?t know what could have, or might have, happened. I just reports ?em as I hears ?em. I just know that I, personally, would never EVER acquire a property, sell a property or deal with an income property any other way. I make my choices though my knowledge base, and expect others to do the same. If they want their knowledge base expanded, I?m here. If they don?t, then I will still help them in any way I can. I don?t care if they ever use the PACTrust or not, but I?ll never stop extolling what I perceive as its virtues.

:?Personally I don?t think it?s too high an expectation Bill that when you make a claim for your PacTrust that you at least make it based on facts rather than opinions.

Facts? As in: ?Lender?s don?t care about unauthorized loan assumptions?; ?Bank?s don?t enforce due on sale clauses very often?; ? I ?think? the PACTrust may have flaws?; ?A lease option probably wouldn?t trigger a DOS call?; “if you hide it they won’t find it”; ?as long as the payments are being made, they probably won?t care?; ?None of my tenants will likekly ever take me to court?; ?A PACTrust trust eviction might not hold up in court?; ?The PACTrust is a ?slick? deal.? Is that what you mean, Jim. Those kinds of ?facts?? For the record, here are some of my facts and some of my opionions.

FACTS: Never has there been a lien, suit or judgment associated with the PACTrust in its 10-year history; the PACTrust has survived all IRS audits; it has survived hundreds of lenders? scrutiny every day; it gives lease and lease option tenants a tax write off; it effectively hides and shields the property (to the best extent possible) from litigation and creditor claims; there has never been an Unlawful Detainer Failure in a PACTrust eviction; it allows for more flexibility than ANY other creative financing device; in its history, thousands have been done without problems.

OPINIONS: The PACTrust will probably continue to do all the above indefinitely; it will possibly survive a lender?s DOS call; though it will probably avoid such an event preventing the call in the first place. The PACTrust will probably continue to survive eviction and UDT challenges; it will probably one day be considered by most to be the preferred means of transfer and security in creative financing; and I will probably be canonized posthumously one day by the Catholic Church as an unheralded martyr (that?s a joke, Jim, don?t reach?and besides…I’m not Catholic).

:? That doesn?t detract from the PacTrust as a vehicle, but in my eyes it detracts from your marketing of it.

Just a guess, Jim, but don?t you feel the same way about Jehovah?s Witnesses? Despite their quirks, do you throw out the overall concept because you don?t believe in their denominational differences? You don?t have to love me, Jim, just be nice to my child?unless it misbehaves (and that hasn’t happened yet).

Again, I think the PacTrust is a slick vehicle.

As in ?Slick Willy.? Right?

:?DOS?? You say it doesn?t trigger. I see WHY you say it?but I question your conclusion.

And I question your question. How could it anything be triggered if there is no trigger? (That?s a rhetorical device, not a question, btw). A property is placed into a land trust and leased out. The matter of who is leasing the property or what he ?thinks? may be his write-off privileges, has nothing to do with the lender?s claim of damage.

:?whether a lender will make some of the distinctions you make, we don?t know?.and if they don?t you lose because you?re in the court room.

That?s right. No matter how strong my case is, and no matter what the law says, and no matter how logical my defense might be?I COULD lose. That is one of those ?facts? that you insist upon. Would I probably lose? Now show me YOUR fact.

:?Frankly, a deal doesn?t warrant that type of cost.

No it doesn?t. Obviously. So we agree. Why do something that is DEFINITELY risky when there is a way to do it that MIGHT not be? Are you certain that your life or health insurance company won?t go bankrupt someday and not be able to honor their comments that you THINK they?ve made to you? I suppose that ?never happens? either.

:?Easy to get those tenants out you say? Well maybe?until one with some dough and desire decides to file suit regarding the technique of dispossessing him from his beneficial interest.

But the same thing wouldn?t happen with a Wrap or CFD or Purchase Option? If you had such a tenant, would you like to be defending an evicting and Unlawful Detainer under a Contract for Deed or Wrap arrangement or a Purchase Option arrangement?OR under an arrangement designed to porotect you from that, wherein, at least THEORETICALLY and (so far) historically, the plaintiff would not have the same rights to use against you.

:?He might still lose perhaps?but then again, you may be faced with substance over form issue?who knows. Either way, a lawsuit drags the deal out?no difference there versus any other technique.

So, let me get this right. You
'd advocate choosing a 100% chance of losing over a 50% chance of winning? Doesn?t sound real smart to me. (Don?t answer that, it?s another rhetorical deal). With the proper defense the ?substance over form ? argument should cease at the point of the assignment of a beneficiary interest. Who cares who an unrelated lessee might be?unless there?s a law that prevents beneficiaries of trusts from leasing properties owned by the trust.

:…Here?s the point Bill?at my age I KNOW NOTHING is a lead-pipe cinch. But to hear you tell it this PacTrust is?.and I don?t believe you.

If I ever said that, you?d have a right to not believe me. But you?re referring to your perception of why I say the things I do: not WHAT I?m saying. When I?m your age, I?ll probably have the same beliefs, but in the meantime, I keep on declaring that NOTHING is a lead pipe cinch (barring death, taxes and your refutation of anything I say): only that there are better odds in in your favor in some circumstances than in others.

:…I don?t have the time, nor the inclination to check out of the facts that I would want to check regarding your claims about the PacTrust?.

Wait?hold it! Unless you have the facts how can you be qualified to comment?or did I miss something you insisted on above? You say ??that I would want to,? then you infer that you do not have ?the inclination to.? Is there a contradiction in there somewhere?

:?I don?t know right now if your ?claims? are reliable because you become too emotional and too eager to claim ANY perceived advantage to the PacTrust. And Bill, in my personal eyes, that?s an issue that you need to deal with.

So why are you so adamantly dealing with it? I am emotional about my wife, my children, my God, my company, students?and bank account. I will never stop defending them against detractors who don?t (as you admit you don?t) have the time or inclination to check the facts about them.

:?Finally, a comment regarding your investor friend. Perhaps my term ?ex-con? is ?insensitive? as you suggest. It?s one of those words that carry some baggage with it?kind of like ?step-mother?. I don?t know the person in question, (although it seems that many others do), and therefore I don?t have a clue what to call him.

Is that an apology, or a justification for insensitivity? We all call him “a guy.”

:?And my guess is that this ?fellow? is more than what you think?I would guess that he?s been forced to deal with this and many other issues revolving around the situation, and therefore probably doesn?t feel the same way you do. But I might be wrong about that?I don?t know the guy.

Wait just a dang minute here? What was that you said about dealing only in fact? Are you just responding emotionally here?or something? What kind of fact is “I guess”?

:?Here?s my deal Bill. I think you should definitely continue to ?educate? regarding the PacTrust here on CRE (not that I have a thing to say about it anyway). And I think that any time I feel the need to make a comment I should?positive or negative. And then you can call me to task if you choose, just as you?ve done.

But, Jim, in the ?deal? you?re offering me, I presume I can have the same privileges, so long as I don?t believe too strongly in what I say, and don?t get too emotional, and never mention that the PACTrust is light years ahead of anything else out there, and that I vow to only make posts replete with citations, case numbers and transcripts. I wish I could accept you deal…but…candidly, I just don?t know?

:?By the way, my wife says I?m cuter since Atlanta?.but that?s probably not what you meant.

That guy you were dancing with in Atlanta would probably agree. Or could that maybe be ?the reason? for your new found glow?

Your friend (scratch that?give me another day or two). :o)

Bill Gatten

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Re: Apologies - Posted by Bill Gatten

Posted by Bill Gatten on September 02, 2001 at 15:19:57:

Of course he has a valid point…he’s Jim Piper. Or at least I’m sure he would have a valid point, if he’d stop and consider what he’s talking about…what the subject actually is.

The person in question has never said he wasn’t guilty. He says that he WAS very guilty of making a big mistake, and for what he was charged for. He only says that he didn’t mean to cause anyone any harm…it just became something that he didn’t foresee that snowballed and got him into serious trouble, and that if he had it all to over again he’d do it differently. The transcript of his case is not important to me, and shouldn’t be to anyone else; nor has it ANY bearing on anything.

A guy made mistakes; the guy got into financial trouble because of the economy; the guy was charged; the guy was found guilty as charged; a means for making that declaration and making the charge hurt was formulated and put into effect by the Government. What is debatable about that? What needs to researched?whether he had criminal intent while being successful before the collapse of the economy and the real estate market.

Bill Bronchik’s land trust, Ron Legrand’s land trust and Lou Brown’s land trust don’t work…they only shield and based on supposition they will only “probably” serve the purpose for which they were designed. OF COURSE THEY WORK! Of course they’re valuable! We don’t need tests and court cases and definitive proof of anything to know that! The trust I advocate using is not dissimilar from those?it?s a land trust. Period!

BTW, I’ve had several speeding tickets in my lifetime (didn’t realize I was going fast until the nice policeman reminded me) was convicted of going AWOL for an evening while in the Navy and spent a week in the brig (my mother’s car broken down in the desert while bringing me back to the ship). I even spent a night in Jail when I was 20 (got into a fight in San Francisco). I even stole a pair of dice from a grocery store when I was 19 (just to see if I could?and I could). So I’m now coming out…I’m “coming forth (out of the closet)” as Jim suggests, and declaring, for the purification of my soul and Piper?s curiosity), that: “I am an ex-convict and a thief…and I forgot to mentioned having filed bankruptcy once for a couple mil (?got everyone paid back eventually though). So there you have it. I’m an ex-convict, a thief, a financial failure and a blatant liar (re. my careless and unfounded assertions re. putting properties into the borrower?s land trust before taking control and leasing them out).”

Why are people so insistent on picking at a friggen blackhead when there’s a giant puss-boil on their ass? I just don’t get it. Is there something looming out there that they don’t want to face, or even acknowledge?

Just because someone challenges me, doesn’t mean they’re right. I’m really small potatoes, so what do I know anyway? I’ve only been buying real estate this way and teaching this stuff since 1984, and probably haven’t made more than a couple hundred millionaires in that period of time with my careless and unfounded technique.

Bill Gatten

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Re: You are right… - Posted by PacTrust Gatten

Posted by PacTrust Gatten on September 05, 2001 at 05:41:01:

You made some very good points in your response to my posting regarding statements made about the PacTrust way of doing business. By that I mean you expressed the points you consider valid regarding real estate in your state and how what Bill Gatten offers might not work as well and so on.

I truly feel sorry for those unable to read about and tolerate expressions for other ways of getting into and actually doing deals in this business. It is true that I have not done the deals you have but experience does not in and of itself provide a singular “golden chute” for doing business. Newbies and those more experienced like yourself are forever coming up with new ways of making deals work. There are many ways to do a deal. It is best to take a little from each system and develop a plan that personally work for the individual involved. An open mind is a powerful thing.

The PacTrust for me offers a way to reach some financial goals without the risk involved in other creative real estate methods. The risks involved in the PacTrust are those that I am more willing to take at this point than those in other methods.

When Gatten responds to question it is natural he will express what he believes will help the person posting the question. He is not marketing his program as such, but how can one talk about a program such as his without naming it. When others mention their particular method it is the same thing except those methods do not have a recognized name like the PacTrust. Not exactly an organized system but workable.

The need to be “right” at almost any cost amounts to “intellectual bullying”. Comments made about my not being able to participate in the discussion due to experience was way over the top because I still have the ability to think and determine what is best for me.

I read and read again Bill Gatten’s comments about the joke he made in his reply to Jim Piper and do not understand how the discussion became mired in discussion regarding sexuality. Gatten’s sense of humor is well known on this and other boards and the comments must be viewed in that light. He meant no harm at all. None. Gentleman, it is okay to be secure in who you are and to smile at a joke while standing tall in our masculine bodies secure in the knowledge that we still have our b*lls.

This board is for real estate and the FREE exhange of ideas and the ability to tolerate varying opinions.

HR you win. No need to continue this thread on my account…

Peace

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For The Record… - Posted by JPiper

Posted by JPiper on September 03, 2001 at 10:03:03:

I’ve been receiving some email about the gay/bisexual comments of Gatten. For the record, I’m not gay or bisexual.

JPiper

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Re: Just another…um…note… - Posted by JPiper

Posted by JPiper on September 03, 2001 at 24:58:43:

Bill:

I think at this point I want to summarize my central points so that they don?t get lost in the Gatten shuffle:

  1. You have no FACTS regarding this case, and therefore it would be impossible to draw a conclusion as to whether or not the PacTrust ?might? have helped or not helped.

  2. The FACT is that you used this guys situation to promote your PacTrust. Here were your EXACT words: ??The investor alluded to here has told me and hundreds of others that this all would never have happened to him if he?d just never taken the titles to those properties: but instead have insisted that the sellers place them in inter vivos trusts and remained co-beneficiaries in them without sale or divestiture of legal and equitable title beyond their own living trust? Note that there are no words such as ?possibly, maybe, might, or probably?. Since this initial statement you have changed what you said to use these words, but I do note that you still insist that this guy ?might? have benefited from the PacTrust. As an aside, I think we can all agree that ?might? means that you don?t have a clue?which is the ONLY appropriate conclusion you could draw since you have no facts.

  3. Your marketing of the PacTrust is at a minimum inaccurate, and perhaps misleading. Let me give you an example of how this works. Here?s a few sales points regarding a well-known technique: a) in the last 10 years has survived all IRS audits b) survives lender scrutiny everyday c) never been an unlawful detainer failure d) numerous deals done without problem or difficulty.

Do you recognize the bulletpoints Bill? You should?I took them out of your post regarding the PacTrust. But I?m making these assertions about MY lease/option acitivity over the last 10 years. In fact Bill, I could have also made these same points regarding my experience with contracts for deed too.

But here?s the difference. When I discuss the contract for deed I mention what I regards as possible disadvantages?.for instance, the equitable title issue. Not that it?s EVER led to a problem for me. But I mention it just the same. It?s a possible weakness of the strategy.

Has it ever occurred to you to say: ?You know, we believe that we?ve designed the PacTrust to survive a DOS clause?but here?s the thing. This isn?t 100% certain. There?s a conflict in the language between the Garn Act and the Codes of Federal Regulation?and therefore we just don?t know how a court might come down on this issue. There?s also a question of occupancy as it applies to trusts. We think these issues would be resolved favorably, but we can?t say with 100% certainty.?

You know Bill, if you made these types of statements your authenticity would rise tremendously in my eyes. But instead, you make flat statements like ?no DOS compromise?. OK, right! When Bill Bronchick points out some possible difficulties with the PacTrust regarding getting the tenant out of the property, your mindset absolutely refuses to admit that there could ever be a difficulty, you make a few emotional comments, sulk for a few days, and then go on to make the same identical statements all over again. In other words, you reject anything anyone else has to say, even though there may in fact be some validity to the comments.

What this all means to me is that you marketing is not accurate. The PacTrust is a good vehicle for certain situations, but your representation leaves something to be desired. I would hope you will at least seriously consider some of the above points over the next few days.

JPiper

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Re: Just another…um…note… - Posted by Ed

Posted by Ed on September 02, 2001 at 20:42:27:

Give it up Bill. You are beating a dead horse!. Now you have gone too far overboard. You should have understood the Cabal was against you from the start and they were not going to give you a chance.

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Your true colors are showing, Gatten… - Posted by HR

Posted by HR on September 02, 2001 at 20:16:23:

Bill,

Jim is certainly a big boy and can take care of himself. I have benefited from this exchange by hearing contrary points of view that have helped me formulate my own views. That’s the whole point of this newsgroup.

I was going to stay out of this debate between the two of you, till I read that final comment about the “other guy, dance, etc.” That’s a gutless cheap shot. Even if you intended it as a joke (and I don’t believe that), it’s a terribly off-color, low class insinuation. And honest to God, Bill, I’m hard pressed to remember a cheaper shot from someone who wasn’t an obvious moron. Congratulations. In relation to the folks here who aren’t obvious sophomores, you have certainly set a new low.

I say this not to defend Jim; Frankly, while you and I know Jim is not gay, that’s irrelevant. The issue is there is no place in any debate for these gutless name callings.

As an aside, I also find your choice of terms so unexpected. You, the supposed liberal, insinuate the “g” word? That’s about as incendiary in a group of male entrepreneurs as the “n” word may be in another context, and you know it. I find it offensive. As someone who is not gay but believes in gay rights, I find your reference very offensive. But let’s not turn this into a gay rights crusade; that’s not the point. Your cheap pot shot denegrates (look it up) the integrity of discussions on this site.

You just don’t get it Bill, do you? You honestly don’t get it. This post of yours is CLASSIC Gatten: take the objections of the other, reframe them, and continue the sales pitch, while totally denying the validity of the original objections.

Again, as I’ve said before, I personally don’t have a problem with this sales style (in fact, I like it as a debate stance) because I know 1) you will never give up; 2) you will throw in every potential angle in the book. Again, for one who truly wants to get to the bottom of a subject, to wrestle with someone like this is a pleasure, 'cause insights will come from the wrestling.

This crap of yours threatens the wrestling, and that’s why I resent it and am commenting now. Frankly Bill, the bar is higher for you than most, and if you can’t take the heat (which I’m begging to think you can’t take) then you should get out of the kitchen. YOU are the “guru” (cut the bs denial that you aren’t one). YOU are the one proposing a better mechanism for doing deals. YOU are making your livelihood off these sales. YOU are relentlessly promoting your product. If you can’t take the heat of any critical appraisal of your product, no matter how well or poorly that analysis is done by others, than you should let others do the net marketing.

And Bill, imho, you really are bad at the net marketing. All these objections to the PT are not always the stance of the uninformed, ignorant, closed minded, obstinate, and less intelligent. Some of them are actually valid objections. Your constant minimization of the objections, though, combined with a rentless spin and unbridled homage to this tool greatly limit your credibility, whether you care to admit that to yourself or not.

Finally, Bill, on a personal note: you know what I’m REALLY sick of in your posts? This eventual, constant, whinning, “victim oriented” stance you always eventually default to. Get over it. It’s as predictable as rain.

In this last series of posts I recall comments about you being an “outsider” to Kaiser, Lonnie, Bronchick, etc. You sound like a whining kid left out of the game at the play ground. And I honestly believe you see yourself that way. There is a consistent, emotional tone to your threads of “poor Bill, the misunderstood martyr victim.” Get off your freakin’ pitty pot.

ANYBODY can join this newsgroup and get recognition for their knowledge, skills, insights, genuine intent, etc. ANYBODY. Piper has such a good reputation because, for YEARS, he has selfless answers questions most of us get tired of answering (what’s a deed? How does a lease option work? Etc). He’s earned his reputation, and in my opinion and the VAST opinion of this community, it’s deserved.

You, on the other hand, have done more to hurt your reputation, and, I suspect, the sales of the PT, by your silly name calling, whining, and adolescent debate behavior than any of us possibly could have. You, Bill, have hurt your baby worse than anyone else this week. May you have the guts to recognize that and change in the future.

Just do me a favor, don’t default into victim mode now. I don’t happen to value that much, especially from a guru.

HR

PS. Get the name right in your rebuttal. It’s Hal, not Hugh.

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Re: Apologies - Posted by DanT

Posted by DanT on September 02, 2001 at 20:42:34:

Bill,
I can’t for the life of me figure out how you managed all those words to respond to my simple post. I said I didn’t care about LO or PT so why all the verbage on what works or doesn’t. I did not question your knowledge or experience nor your background. Just an observation taken from experience.
My point is simply without looking at the real story, or the case itself you don’t know how much information this gentleman has forgotten. Trials are really intense situations and many facts get lost in simple translation. I am not lambasting the guy. I don’t care about him one way or the other. I am just saying you don’t know the facts either at this point. That being said and this starting out as a PT commercial it would seem difficult to believe your conclusions or assumptions without facts. Thats all I am saying.
Now, before you jump into your multi paragraph, long winded, intent twisting tirade. Let me say I am not reading or responding anymore on this issue as it matters not to me one way or the other. And frankly I am an impatient type who hates long winded reading unless it is a book of interest. DanT

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I AM TRULY SORRY!!! - Posted by Bill Gatten

Posted by Bill Gatten on September 03, 2001 at 11:39:26:

Jim,

I never intended that comment to be anything but humerous. I never dreamed you, opr anyone else, would EVER take it that way. Had it been said about me, I would have thought it was very humourus. It was a failed attempt to end the dialgoue with a smile and it really backfired. I’m sorry.

I am so very sorry. I have no idea how I ever got into this mess.

I’m just sorry. That’s all I can say.

Bill Gatten

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What a way to win a debate… - Posted by chris (fl)

Posted by chris (fl) on September 03, 2001 at 13:14:15:

Beating the guy down with the old politically correct stick. Seen it happen so many times in New York. I miss nearly everything else about the place. I’ve seen it short-circut many a fine exchange of ideas and opinions. Too bad. … Oh well , c’est la vie.

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Re: Your true colors are showing, Gatten… - Posted by Bill Gatten

Posted by Bill Gatten on September 03, 2001 at 11:45:03:

Hal,

I would never in a million years have dreamed that my attempt at humor would be perceived that way. The “joke” was something I heard many, many years ago on the old Dean Martin Show. I could never have imagined it being be taken the way you (and probably others) did. Jim Piper is the last person in the world anyone could ever draw such conclusions about.

I truly apologize.

Bill

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How to Market the PacTrust… - Posted by HR

Posted by HR on September 03, 2001 at 08:47:16:

Bill and company,

Frankly, I just don’t have time to sit around and wait for your response, so we can enjoy a long pi$$ing match with each other. I’ve got work to do. I honestly have come to the conclusion, Bill, that you really don’t see/recognize where some of us are coming from on this marketing issue, so I thought I would cut to the chase and give you the answer. Or, at least my answer.

Guys charge thousands of dollars for this stuff. I’ll leave it up to you to figure out how much you are going to reimburse me. I’ll leave it up to you to figure out if I’m really joking here or not…

So, let’s move onto an intellectually honest marketing of the Pactrust…

Folks,

If you are intersted in the PacTrust, here are a few things you should know about it:

  1. It was designed to circumvent but not violate the DOS clause. (It’s at this point, Bill, that you can launch into your usual, witty, intelligent description of how the PT works).

  2. Compared to other creative vehicles in most states, the PT may provide greater protection than the alternatives.

This is the heart of the PT marketing. It’s the heart of the reason to use the PT: that compared to other creative approaches, the PT MAY give one greater protection with more ease than other alternatives.

At this point, Bill, you do your usual dance and describe the other alternatives and their pros and cons. You then describe the PT’s pros and cons.

When you get to the cons, you don’t minimize them. You don’t respin and redefine them as something else. You try to give them an honest, intellectual appriasal of their relative merit. If some of these issues and risks are remote, you say that; nothing dishonest about that. You just don’t deny them. For example, Piper mentioned a few issues above. Here are some others.

We really don’t know how a judge or court will rule on this. Because of that, there may be some risk. Now, granted, the risk may be small, and taking this risk may be more acceptable than living with the risks the other creative vehicles provide, but there is some risk here nonetheless. Let’s name it and be honest about it and let the potential buyer understand the issues so he can decide for him/herself wether using the PT with its limitations is riskier than using the other alternatives.

Another risk is that in a single default scenario wherein a lender has begun to accelerate the loan and not given a rat’s azz about the PT or anything else, there is little one can do about it. Frankly, I think you should have a 2-5 page letter in your PT kit to send to lenders should this ever arise to try to convince them otherwise, but that’s on you. The fact is, even if the PT is right, and it doesn’t violate, if a lender doesn’t care to listen and the investor doesn’t have the coin to fight, it’s a losing battle anyway. It’s a risk, albeit farfetched (in your mind) but let’s name it as a risk anyway. As you and I know, this risk is shared by the other creative vehicles, so choosing the PT isn’t any less risky in this sense, but to use the PT doesn’t guarantee protection. It provides the best logical protection, but whoever said judges, lenders, and others were logical?

Another downside of the PT is that it is unknown. What is known is often less risk than the unknown. Renting my place with a lease is little risk, if I follow local law on how to use a lease. Everyone, even my aunt Sally, knows what a lease is. This ain’t the case with a co-beneficiary trust agreement whereby the leasee gets use and control and tax benefits of the property, under certain conditions. The fact that attorneys, buyers, sellers, etc don’t know about this concept will make it a harder sell in the least (which can be overcome with good sales skills, so polish up on those, boys) and a risk of litigation at the most because this thing is not known and there is no case law on it.

Frankly, it’s also time to admit that this thing is complex, bill. CUT THE CRAP comparing it as less complex than buying a car, etc. Cut the spin! The redefination! The fact is that this thing, as a re concept, is FAR more complex and harder to understand than a lease, an installment land contract, than an option, etc. Give me a break, Bill. All these people who don’t get how the PT works aren’t idiots. It takes awhile to get one’s brain around this thing. The complexity of it poses challenges not just to someone considering buying it, but, again, to a guy I’m selling it to, to my closing atty, to his potential lawyer, etc. (Again, this can be somewhat mitigated with strong sales skills, so bone up on this, girls).

After a thorough review of the pros and cons of all the choices, and an honest appraisal of their risks, one can then decide if the PT makes sense to one. And you know what, if the guy/gal now decides to use the PT, he/she at least has an informed stance about what risks he may or may not have to face and how to potentially counteract them.

Frankly, your competition does that. Bronchick, in all his stuff, talks about the limitations and downsides to every technique described. This doesn’t limit its desirablility for me; that’s real world that the thing has downsides! I appreciate knowing so I can conduct my biz in such a was as to avoid them!

Start informing folks up front about the risks. Sure, sure, you have done this in the past, but it’s always in a light that minimizes them to the point of denial. I don’t think that’s helpful.

Finally, you know why I have such a bur up my butt about this issue? It’s because YOU WERE WRONG. You ARE WRONG ABOUT THE PACTRUST in my state.

I’ve been in the hunt for a commercial property by a 6 lane highway (just closed on it Friday). I’m gonna be putting a huge “I buy Houses” sign on that sucker to attract biz. I know I’m gonna get some subject2 type biz from the sign. While this isn’t my normal course of business, it’s something I will do. So I started my due diligence on this area of rei a few months ago.

The PT was prominent on my list. After all, I’ve heard superlatives used by you and others about this thing. How could one not consider it?

So I did my due diligence for Louisiana on the PT, and you know what I found? I found that it wasn’t like you said at all! It wasn’t better! It wasn’t easier! In fact, there was another instrument that could achieve the same ends with less risk and greater ease!

I can’t help but wonder: if that was my case here, will it be the case of someone in Montana? Nevada? South Carolina? Perhaps Louisiana’s laws are unique to the entire rest of the country. Perhaps not. All I know is that when I was prepared to buy and use the PT, and I considered it in light of the pros and cons of other techniques, it fell flat agains the installment land contract here. That’s a fact.

So, when I see you spin this thing as the latest and greatest, while minimizing the downsides and risks, it doesn’t match my experience. And I can’t help wondering if we are the exception or the rule.

I’ll give you that we might be the exception. I’ll give you that the PT works as described in 49 other states. If you marketed this thing as a rational alternative with pros and cons that each buyer could verify for him/herself, you would go a long way towards getting more credibility from some in this group. (at least me). Instead, you describe this thing as not just an alternatvie but “the basket” (post from long ago). My God, you’d think this thing was the Messiah the way you describe it, Bill. And, again, from my experience, it wasn’t even good enought to beat our good old bond for deed.

So, Bill, you and your gang market this thing any way you like. Personally, I think you should honestly leave the net marketing to Pasquini. At the convention, Jim and I debated this stuff into the wee hours, and I found him to be a rational and common sensical guy. He changed my mind on a few points, and I his (don’t fire him).

If I were to market the PT, I would not hinge the sale on superlatives, but a rational discussion of the pros and cons of the PT as compared to it’s alternatives. That’s its strength.

Marketing this thing as a sure fire way not to get foreclosed on, ever, under any circumstances, because it technically doesn’t violate the DOS clause is an inferior marketing strategy. Adding spin, redefination, and minimization of the risks/objections of others only dilutes the marketing credibility. If this thing really is better than the alternatives (which I am willing to concede is the case for some others in some other states), than the knowledge of this fact alone will lead to sales. It also will lead to a more informed user, which certainly will not be the case with those listening to the current marketing approach.

HR

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Not that there’s anything wrong with it !! nt - Posted by Ben (NJ)

Posted by Ben (NJ) on September 03, 2001 at 15:12:55:

nt

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Re: How to Market the PacTrust… - Posted by Bill Gatten

Posted by Bill Gatten on September 03, 2001 at 11:48:32:

I haven’t taken the time to read your post…but I know that whatever it is you said, it is true. The bigger issue at hand makes this all pretty superflous. For anybody reading what Hal said…accept it.

Bill