straw buyer con?? - Posted by mp

Posted by milo on December 08, 2002 at 08:02:28:

Thanks John.
Let me ask you this:
They both have corporations set up and as far as the assets go, yes, they are wealthy but I am not sure if touchable.
How do I put lean on them?
Also the deal is as follows:
Family arguing about the building and they are willing to unload it in a 200k discount!!! They are more motivated than anyone I know.
This investor is looking at 245k profit minus expenses
in 6-12 months.
So the deal looks great.

Anyway, I would appreciate any comments.
Milo Prochazka

straw buyer con?? - Posted by mp

Posted by mp on December 07, 2002 at 08:24:47:

hey guys
I posted a question reg. a straw buyer situation some time ago. For those who didn’t see it and could help, here is the scenario:

An experienced investor and his close friend buy a multi-fam. home using my credit. They will have an escrow set up and everything will go through an attorney. It’s one of the government deals, where you have to hold the property for 6 months and the government overlooks it - escrow, etc.

They have a nice profit down the line and want to pay me 10k upfront using my credit.

My question is:
How would one protect himself in case they default on the payments? What kind of contract/terms should I demand in case I want to go ahead?
Anyone with experience like this?

I could make 10k and in 6 months be off the mortgage.
This 10k can make a huge difference to me in terms of starting in REI.

Thanks for your comments

Re: straw buyer con?? - Posted by JHyre in Ohio

Posted by JHyre in Ohio on December 08, 2002 at 05:34:00:

Assuming that your attorney confirms that there are no loan fraud issues: Do they have assets to seize? If so, get a lien on them. Is the deal so good that you could make the payments by taking it over if need be? If the answer to both questions is “yes”, have at it. Otherwise, you are exposed to non-payment.

John Hyre