Liberal judge doesn't understand or like sub 2 - Posted by Hank

Posted by Hank on June 29, 2002 at 10:57:28:

He’s got a lawyer, but an appeal will take time and money. Remember, it’a an out of state deal.

Sometimes it’s just better that pay off that son of a bit_h deadbeat tennant to get him out than go through a tough eviction.

In this case, he told me that they were going to appeal. I smell two possible things here. More in equity than the cost and hassle of the appeal and/or a tennant buyer taking legal action because his option is no longer any good. That’s unlikely though because he paid the rent to the wrong guy, and that’s what FUBARed up this whole deal to begin with.

There’s a third reason he might appeal. Pride with a liberal amount of anger thrown in.

But a level headed, by the numbers businessman is not supposed to let that kind of thinking creep into his head for too long, … right?

Liberal judge doesn’t understand or like sub 2 - Posted by Hank

Posted by Hank on June 28, 2002 at 18:03:11:

Heard a true story from a friend last night. Can’t go into much detial but here’s the story.

Seller wants out. Has job hundreds of miles away. Investor takes over payments using the tried and true sub 2 method of using a land trust.

Seller loses job. Seller comes back to his old house and tells tennant to pay him the rent 'cause it’s his house.

Tennant pays him the money.

To make a long story short, the judge hears both sides and rules in favor of the seller because he is on the mortgage so he owns the house. He didn’t want to hear any more about assignment of benificial intrest or any of the other paperwork – which was perfect.

Don’t buy it . . . - Posted by William Bronchick

Posted by William Bronchick on June 28, 2002 at 22:12:36:

Every once in a while, we “hear” a story like this and I always have to ask . . . “what did the investor do to deserve it?” If the facts are as straight as you say (or should I say, heard them, since it may be the friend omitted some relevant facts), then there is no legal basis for the judge’s decision. Every once in a while, judges throw the law book out the window and do as they please (case in point, the multiple appeals in the 2000 election). However, when judges do so, it generally means one party did something so egregious that the judge called the deal a fraud, mistake of fact, undue influence, etc. In such a case, the court has equitable powers to make things right, regardless of the law. This is not just the case in a “subject to,” but in the case of a contract, a mortgage note or any other transaction in which there was gross over-reaching, gross misrepresentation or outright bad faith.

Bottom line . . . this story means nothing.

Can you say “Appeal” - Posted by Jim FL

Posted by Jim FL on June 28, 2002 at 22:00:24:

Sounds to me like your friend has a good case for appeal.
I find it hard to believe that anyone can collect rent legally on a property they neither own or have an interest in.

Based on what you stated here, this friend certainly could file an appeal, and perhaps some other action against the seller.

Sounds to me like they need an attorney.

Also, if the judge says the investor does not own the house because their name is not on the mortgage, then should things go arry with the deal, can the investor just walk away with no recourse?

Sounds to me like this judge had a BAD day and took it out on the investor.

Let us know if anything further developes,
Jim FL

your post doesn’t provide much… - Posted by Brian M. Powers(MI)

Posted by Brian M. Powers(MI) on June 28, 2002 at 18:44:22:

…details or validity.
Can’t go into detail? Why not?
What State? What County? What court? What is the case number?
I am sure the investors on this board would love to take a look at this case.

A NICE LITTLE STORY - Posted by Lazaro

Posted by Lazaro on June 29, 2002 at 21:11:08:

I just recently had to evict a tenant that was on a Lease with an option. Two separate contracts. You would not believe what this judge did to me. He said it was TOTALLY illegal to have 2 contracts. He said there was NO way that I could do that. I guess he decided to throw them out the window and rule on whatever the darn ‘trailer trash’ tenants said. He said VERY clear that he did NOT care what the contracts said. He told me to stop hiding behind the contract…geez…I thought that contracts where made for BOTH parties to agree on certain terms and conditions. Guess this judge didn’t see it that way. It was funny. This judge gave me NO time to present my case. He would not look at ANY of my stuff and decided he had to see EVERYTHING from the tenants. Then to make matters worse he ruled that I had to give back $1,400 to the tenant. The tenant lived in the premises for 3 months at the rental rate of $550 and $700 option money. Can you believe what this judge ruled? I couldn’t believe it. So, now I won’t do another L/O deal in this county until the judge is out of office. I hope to campaign hard to get his rear out. This is just a little story to show how judge’s do WHATEVER THEY want. Then there are NO standards and it would cost me thousands to fight it in court (appeal). Well, I guess I have vented enough…LOL. Hope it didn’t put you to sleep…LOL.
Just a Little story in my book…

Re: Don’t buy it . . . - Posted by Hank

Posted by Hank on June 28, 2002 at 23:09:42:

What the judge calls one thing or another and what might be true can be two different things.

People scr_w up.

To say the story means nothing to you might very well be accurate.

I find it interesting. I posted it because I thought others might think the same.

Had I been wiser, I would have harkened back to the “due on sale jail in Louisiana” thread of some time back and remembered the uproar that was unleashed.

I should have kept the two stories I heard last night to myself.

It’s all I can say - Posted by Hank

Posted by Hank on June 28, 2002 at 19:43:37:

My friend didn’t give me a case #. Nor did I tell him I’d post his problem on a very popular website.

I didn’t think I’d be doing him any harm by putting it up here today.

This kind of stuff is very interesting to me. Many of the seminarians out there don’t tell people of these things.

What I put up is all we really need to know, or already know.

We all know that judges have equitable powers.

They can do as they d_mn well please.

No matter how right and brilliant something is, what happens when it goes before a judge?

Most of the time they follow the law. Sometimes they make law.

Believe me, from what I’ve been told, the judge just got tired of hearing about all this land trust stuff. He’s a simple guy from a state where land trusts are not used very much.

Appeal It! - Posted by JohnBoy

Posted by JohnBoy on June 30, 2002 at 02:28:11:

BTW, Why did you even say anything about having two contracts? One of the points of having separate agreements is so you can just show the Judge the LEASE agreement only! Then IF the Judge asks to see the OPTION agreement you show it to him then. Otherwise you don’t even mention it!

You should of asked the Judge if this means ALL mortgages are ILLEGAL since they ALL have TWO CONTRACTS! A mortgage or trust deed AND a separate note!

Take the $1400 you were ordered to pay the tenant and use that to appeal the thing! Then you can do more deals and if you ever have to go to court again and get the same Judge you can cram it down his throat if you win the appeal!

Don’t think in terms of it will cost you thousands to appeal. It will cost you tens of thousands NOT to appeal! You say you won’t do deals in that county as long as that Judge is in office. THAT will cost you tens of thousands! To protect that future profit you can be making you need to appeal this so you won’t have to worry about giving in to some wacko Judge and lose out on all those future deals!

Re: A NICE LITTLE STORY - Posted by JohnBoy

Posted by JohnBoy on June 29, 2002 at 22:05:13:

Here is a case some guy filed against the state suing judges as employees of the state alleging crap they pulled on a case of his that was heard before them. LOL

Here’s a good analogy . . . - Posted by William Bronchick

Posted by William Bronchick on June 29, 2002 at 09:07:58:

Here’s a good analogy . . .

The headline of a newspaper reads, “5 Investors Indicted in Property Flipping Scam.” Without knowing all the facts, people assume flipping properties is illegal. Some dope actually posted this ignorant comment on as a reader’s review of my book, even though he never read it!.

The truth is, the investors who were flipping properties were falsifying loan documents and bribing appraisers. The flipping part had nothing to do with it. Likewise, when someone tells you “buying properties subject-to using a land trust won’t hold up in court,” there’s something else he didn’t tell you about.

In all fairness… - Posted by bill gatten

Posted by bill gatten on June 29, 2002 at 06:51:40:


Bill was not trying to be confrontation (in this case). He was just trying to make you and the other readers here feel better about the possible ramifications of using a land trust. I agree with him completely on this one.

I am certain that the information you presented was absolutely true; however, I think the story you got might have been missing some details. And even if it was complete when you heard it, the person in question could appeal this case to a more normally intelligent court and win it.

As Bill mentioned, judges do ridiculous stuff all the time due to the “God complex” that sets in after realizing their power to grant or destroy human life. But, hey, thats why we have appeals courts.

After all, we’re the “People.” Its you and I who gave that judge the power to not do what we gave him the power to do, because we had the power to do so.

An this is a government “by the People and for the People,” isn’t it?

Bill Gatten

Re: It’s all I can say - Posted by JohnBoy

Posted by JohnBoy on June 28, 2002 at 22:03:49:

Maybe that is where the problem was? Trying to get into all this land trust stuff! I assume he used a purchased agreement and filled out a hud 1 when he purchased the home subject to the existing mortgage? That is all he should of shown the Judge. He PURCHASED the house. Here is the purchase agreement and here is the Hud 1. End of story! It’s my house!

Did the Judge order your friend to deed the property back or he did he just say, since the mortgage is in the seller’s name he gets the rents and its his house?

Your friend needs to get an attorney and get this taken care of unless he doesn’t want the house any more? And if he doesn’t want it any more he should get a signed release from the seller before deeding anything back to him.

But I would be curious if the Judge ordered him to deed the house back and just exactly how did the Judge order that if he didn’t seem to understand anything about the land trust???

What state was this in?

Same thing in NYC - Posted by William Bronchick

Posted by William Bronchick on July 01, 2002 at 12:40:30:

I used to practice in NYC. I did about 200 evictions in NYC housing courts. The Judges there so flagrantly ignored the law that the landlords’ assoc filed suit in Federal court to FORCE the state judges to abide by their own state laws. Even so, the judges continued to ignore the law and do whatever they thought was “fair” (which usually included letting tenants stay for weeks, even months without paying). The landlords assoc went back to the federal court several times to seek reinforcement of the federal judge’s order.

Point is, sometimes judges (and cops) don’t follow the law. It doesn’t mean you shouldn’t do things by the book, because most cops and judges DO follow the law.

Re: Here’s a good analogy . . . - Posted by Hank

Posted by Hank on June 29, 2002 at 10:03:24:

This guy is a staight shooter.

And believe me when I say it’s not in his best intrests to scare people away from doing deals. He sells books and tapes.

It was raining and nobody wanted to leave untill it slowed up. We stayed an extra half hour or so talking about things that were kinda off the beaten path.

I have nothing against sub 2s. This weekend I’ll be meeting with several sellers, and I’ll try to sub 2 most of them.

My point with the two posts I started last night were that in our business, like any other, you get served a sh_t sandwhich every once in a while, and sometimes you just have to wash it down with a glass of wine. Red or white?

Re: Here’s a good analogy . . . - Posted by Brian Mac

Posted by Brian Mac on June 29, 2002 at 10:25:04:


Wash it down? No way. Send it back to the hack that served it.

What is he going to do now? I’m sure he’s not going to let the judge use him as a doormat, is he?

I’m not questioning your reporting. But it makes little sense that someone who sells books and tapes would not be represented by an attorney. Didn’t he use an attorney?

Thank you

Brian Mac