Posted by John Merchant on January 09, 2003 at 12:18:25:
Merely having and making use of “straw buyer” in Hawkins wasn’t the thing that got Hawkins convicted, as I read the report.
What DID get him in trouble was his fraud in completing the mortgage docs with false facts.
Not a criminal matter in any way, shape or form if A simoly gets the loan and title, but then gives B an option to buy back, etc. Or other, non-title rights to the property. Looks like atty. Hawkins went a good bit further with falsifying loan app, etc.
Using Another Person’s Credit - Posted by NM TampaBay
Posted by NM TampaBay on January 06, 2003 at 18:47:09:
I am unable to obtain financing (other than high interest hard money) because I have recently quit my job and am investing full time (no proof of income). I have someone who is willing to allow me to use their credit to purchase real estate for a portion of the profit on the deal. What is the best way to do this? Thanks for any suggestions.
NM
Posted by John Merchant on January 09, 2003 at 12:09:59:
If a client were asking me about preferred method, I’d recommend simply having your accomodating friend buy it in his/her name, but then give you an option to buy it back in certain time for certain price.
With your just having an option, but him/her having the title, if something happened to you he/she still owns it and would have no hassle with your survivors or estate. If your plan works and you can & do buy it back, great…if not, it’s his and you’re history.
Another possible way, but frankly one I wouldn’t like if I were your friend’s lawyer, would be to have title in corp or trust and then transfer the stock or trust interests to you…bank also might not like this very much and might give your friend a bad rep with lender.
Re: Using Another Person’s Credit - Posted by River City
Posted by River City on January 08, 2003 at 09:32:11:
I am not sure that I totally understand your question. Hopefully, you do not mean that you will be using someone else’s name and credit history in applying for credit on the purchase of real estate, as this would be committing fraud. It appears that what you are referring to is more commonly known in the real estate/mortgage industry as a “straw buyer,” and is also illegal.
Re: Using Another Person’s Credit - Posted by NM TampaBay
Posted by NM TampaBay on January 08, 2003 at 10:15:48:
I was actually talking about entering into a deal with a partner who would be signing for the loan instead of me, because they have verification of income and a higher credit rating which would result in a lower interest rate for the loan.
Re: Using Another Person’s Credit - Posted by River City
Posted by River City on January 09, 2003 at 09:50:46:
According to my MBA glossary, the definition of a strawbuyer is “one who purchases property for another to conceal the identity of the real purchaser.” Go to this website and read what happens when transactions with strawbuyers are discovered. In this particular case, they also falsified documents.