Creating a spread between what appears to be a "straw" buyer and the eventual "real" buyer on a Short Sale - can this possibly be legal?
We thought this was a behind the scenes scenario we were hearing about... but the 12th comment down on this post on ActiveRain is from someone admitting their entire company is based on this sly maneuver.
These two comments are quite telling:
"We prefer that you give us a call as soon as you get the listing and not communicate with the bank(s) first. For us to be affective at what we do, we need your full cooperation."
In other words, don't YOU tell the bank what we're doing, we've got some way of telling them that gets this through. Legal or not, I don't know. I do know it would be illegal if the HUD doesn't clearly spell out how the double closing works and that the bank isn't getting as much money if they were to sell direct to the end user.
"We also let the listing agent keep the listing and re-list the property for us to resale to someone looking for a good deal on a short sale through our negotiation process."
Cool, for me to participate in what might be illegal behavior I'm enticed with two commissions. I think that's why Willy Loman liked to rob banks with more money in them. Better pay for that crime... that doesn't pay.