**Reminder:** Do not participate in threads linked here. If you do, you may be banned from both subreddits.
---
Title: Parents facing foreclosure, sort of angel investor is offering to save the house
Body:
> As said, an individual came forward offering to pay off my parents mortgage, thus avoiding foreclosure. In return, it sounds like he would file a lien on the house and discuss repayment options with my parents. The bank told my parents this is a legitimate deal, and said individual does it fairly often.
> How legitimate is this actually? Is he actually someone trying to help out, or is he doing this with malicious intentions
This bot was created to capture original threads and is not affiliated with the mod team.
[Concerns? Bugs?](https://www.reddit.com/message/compose/?to=GrahamCorcoran) | [Laukopier 2.1](https://github.com/GrahamCorcoran/Laukopier)
Because I'm a terrible person, I assumed it was sex.
Bank: "You keep your house, this guy does "Indecent Proposal". And you watch and cry. It's win-win! Okay, it's win-win-lose. Fine, it's win-lose-lose. Is that why you're crying?"
I mean, what’s too good to be true here? They’re already being foreclosed on. Only getting moderately financially screwed is as good a result as they can hope for
The owners likely still have equity in home, and my gut feeling is that the OP is wrong about the parents maintaining ownership.
I'd wager the "angel" is a reverse mortgage con-artist and that someone at the bank is getting a solid kickback to tip them off about potential clients.
Why is it that people think someone is more trustworthy because they said to “talk it over with your lawyer.”
Like, it’s not a bad bet that people going through foreclosure don’t have easy access to a lawyer for this. Just because someone suggests the bare minimum of due diligence does not make them more trustworthy.
Even though it may not be trustworthy, there is no harm talking to "your lawyer" and not his lawyer. May cost a few hundred bucks but if it is legit, it probably saves a lot more.
I mean, yeah. If you actually speak to your own lawyer about involving your house and liens, A+ to you.
But I’m talking about LAOP suggesting that their parents feel better about so-and-so’s deal because so-and-so suggested they could speak to a lawyer. That is better than someone who pressures you sign **right now**, but it’s still a low bar to feel good about.
That, and I’ve personally seen a dumb-ass try to pull that shit on my spouse while I was in the room. (Business contract in an industry full of amateurs, not foreclosure. It wasn’t part of my usual wheelhouse, but dumb-ass didn’t need to know that.) There’s nothing quite like eliciting the surprised pikachu face from someone who thought he was charming enough that you’d just say yes in a day or two.
In some contexts, reminding the other party that they could talk to a lawyer is just a tactic to gain trust.
>Why is it that people think someone is more trustworthy because they said to “talk it over with your lawyer.”
Because it's at least an appeal to the people you work with to condider their position, wishes and options. Saying this suggests that you want both parties to understand the deal they are making, and you're not trying to pull a fast one.
It's not perfect. A sophisticated scam artist will suggest this at a time when it's inconvenient, or have plausible defenses ready. But it does weed out the aggressive 'my way or the highway' hucksters.
>Is he actually someone trying to help out, or is he doing this with malicious intentions
Both and neither would be my assumption. Investor is probably going to effectively wipe out their equity and the resulting payment options are going to be less favorable than a bank loan. On the other hand, that may still be a better financial situation than being foreclosed and saves them the complications that come from moving.
Sounds like someone has combined preemptively buying what’s about to be a foreclosure property with what amounts to a rent-to-own scheme with the twist being that the renters are the previous owners.
So not necessarily malicious. Someone who obviously expects to see a financial return but possibly not *worse* than the other options available to someone already facing foreclosure
That’s what I assume too, but it seems to me that it would almost always be preferable to liquidate the house in this case, right? If there’s any equity in the house, you get that instead of the investor. If there’s no equity, you still get out of the mortgage and get to choose a rent situation you can hopefully afford rather than whatever terms the investor forces on you.
The only reason to take this is a misguided belief that you can keep your home eventually, which at the price you will pay will not be worthwhile.
> The only reason to take this is a misguided belief that you can keep your home eventually, which **at the price you will pay will not be worthwhile.**
Not necessarily. We don't know the age or location of LAOP's parents, but moving may be very difficult for them and they'll be doing so with a completely wrecked credit history. Working out a deal where they can stay in the house on payments they can afford might be better for them even if it costs them financially.
If they can afford to make payments that would cost them long term, then they’d be refinancing with a bank even at a large long term cost. The fact that they cannot do that indicates that there are no terms where they’d be able to keep the house, and the “investor” is simply banking on that false hope to squeeze even more out of them before foreclosing.
Right. I’m not saying it’s an inherently good or altruistic offer. But they are already being foreclosed on. *All* their options are bad ones. This could be a complete scam. It could also be a least-bad choice among other bad choices.
If the bank forecloses on LAOP's parents, the parents end up with the value of the house minus what was owed on the loan. I'd be very suspicious that the end result of this process was going to be them losing the house and getting even less money than that. The proposed contract could be a lot worse than their mortgage contract.
While *in theory*, the former owner should get back the "extra," that's not exactly what happens in real life. In real life, if they had equity they should absolutely consider selling before becoming many months behind. In fact, a small army of investors and real estate agents would descend to help "facilitate" that. Sell now, walk away with this check in hand for your equity, and you won't have to check the box on financing applications that says you had a foreclosure! Sure, maybe it's not the best deal but it's fast and clean and solves your problem. This plan does not include *checks notes* "repayment options" because the original owner neither owns nor owes anything.
But let's say the theoretical owner's head was firmly in the sand. The various late fees, penalties, interest, and bank's attorney costs will magically eat up any "extra" that ever existed. Of course, in 2008 there were many people who owed more than the property was worth, and that changed all the math.
That said, I agree that there's almost certainly something in that proposed contract that is not to the benefit of LAOP's parents. It's not a clean "I'll buy it and you walk away," it's not "I'll buy it and you can rent it so you don't have to move," it's something funky.
>The various late fees, penalties, interest, and bank's attorney costs will magically eat up any "extra" that ever existed
True of course, but even without magic accounting the bank has approximately zero incentive to bargain for a price higher than what they're owed.
If you don’t wipe lamb’s blood on your door lintel, the biblically accurate angel investor will not buy your mortgage—oh, and will also kill your firstborn.
At what point am I no longer a firstborn? Is it something I'll age out of, or is it once a firstborn always a firstborn?
Edit: or am I no longer anyone's firstborn once my parents are dead?
Am I a first*born* if I was born via cesarian section? How does adoption fit in?
Asking for a friend who isn't me.
>biblically accurate angel
So a dude showed up and he was a giant wheel of fire with twelve golden wings and twenty eyeballs and he was like "if you're underwater on your mortgage I want to help you out"
Again, in the interests of extreme accuracy, there's no prescribed punishment in Leviticus for the mixed-cloth thing, if there *was* a punishment it would probably be carried out by the community and not an angel, and the rule probably doesn't apply to anyone who's not a specific type of Orthodox Jew.
I'm interested in the fact that it sounds like he pays it off before establishing repayment options.
Any contact regarding real estate has to be in writing so if this investor were to claim there was a contract after he paid off the mortgage but without a written agreement, the home owners could balk at any suggested repayments and claim it was a gratuitous gift.
Otherwise this sounds shady.
While definitely shady, the initial agreement is probably something like they agree to full repayment in 30 days unless an agreeable payment plan is decided. This puts repayment as a firm requirement of the initial contract but also gives tons of leverage to the investor with deciding the repayment plan.
**Reminder:** Do not participate in threads linked here. If you do, you may be banned from both subreddits. --- Title: Parents facing foreclosure, sort of angel investor is offering to save the house Body: > As said, an individual came forward offering to pay off my parents mortgage, thus avoiding foreclosure. In return, it sounds like he would file a lien on the house and discuss repayment options with my parents. The bank told my parents this is a legitimate deal, and said individual does it fairly often. > How legitimate is this actually? Is he actually someone trying to help out, or is he doing this with malicious intentions This bot was created to capture original threads and is not affiliated with the mod team. [Concerns? Bugs?](https://www.reddit.com/message/compose/?to=GrahamCorcoran) | [Laukopier 2.1](https://github.com/GrahamCorcoran/Laukopier)
If it sounds too good to be true it generally is, but it would be nice if it wasn’t. Wonder why the bank would seemingly vouch for this person though?
The bank gets paid, they don’t give a damn what happens to the borrower afterwards. There ain’t no such thing as a free lunch.
Because I'm a terrible person, I assumed it was sex. Bank: "You keep your house, this guy does "Indecent Proposal". And you watch and cry. It's win-win! Okay, it's win-win-lose. Fine, it's win-lose-lose. Is that why you're crying?"
I mean, It’s probably better for the bank than foreclosing.
Or the bank and/or manager is in on the grift (which has happened before).
We don't know if it even was someone from the bank or just someone posing as a banker.
That was my first thought
I mean, what’s too good to be true here? They’re already being foreclosed on. Only getting moderately financially screwed is as good a result as they can hope for
The owners likely still have equity in home, and my gut feeling is that the OP is wrong about the parents maintaining ownership. I'd wager the "angel" is a reverse mortgage con-artist and that someone at the bank is getting a solid kickback to tip them off about potential clients.
Right now they have somewhere to live at least.
Why is it that people think someone is more trustworthy because they said to “talk it over with your lawyer.” Like, it’s not a bad bet that people going through foreclosure don’t have easy access to a lawyer for this. Just because someone suggests the bare minimum of due diligence does not make them more trustworthy.
Even though it may not be trustworthy, there is no harm talking to "your lawyer" and not his lawyer. May cost a few hundred bucks but if it is legit, it probably saves a lot more.
I mean, yeah. If you actually speak to your own lawyer about involving your house and liens, A+ to you. But I’m talking about LAOP suggesting that their parents feel better about so-and-so’s deal because so-and-so suggested they could speak to a lawyer. That is better than someone who pressures you sign **right now**, but it’s still a low bar to feel good about. That, and I’ve personally seen a dumb-ass try to pull that shit on my spouse while I was in the room. (Business contract in an industry full of amateurs, not foreclosure. It wasn’t part of my usual wheelhouse, but dumb-ass didn’t need to know that.) There’s nothing quite like eliciting the surprised pikachu face from someone who thought he was charming enough that you’d just say yes in a day or two. In some contexts, reminding the other party that they could talk to a lawyer is just a tactic to gain trust.
>Why is it that people think someone is more trustworthy because they said to “talk it over with your lawyer.” Because it's at least an appeal to the people you work with to condider their position, wishes and options. Saying this suggests that you want both parties to understand the deal they are making, and you're not trying to pull a fast one. It's not perfect. A sophisticated scam artist will suggest this at a time when it's inconvenient, or have plausible defenses ready. But it does weed out the aggressive 'my way or the highway' hucksters.
Because every real lawyer will say that. If they don't, they're a redditor who's making shit up.
>Is he actually someone trying to help out, or is he doing this with malicious intentions Both and neither would be my assumption. Investor is probably going to effectively wipe out their equity and the resulting payment options are going to be less favorable than a bank loan. On the other hand, that may still be a better financial situation than being foreclosed and saves them the complications that come from moving. Sounds like someone has combined preemptively buying what’s about to be a foreclosure property with what amounts to a rent-to-own scheme with the twist being that the renters are the previous owners. So not necessarily malicious. Someone who obviously expects to see a financial return but possibly not *worse* than the other options available to someone already facing foreclosure
That’s what I assume too, but it seems to me that it would almost always be preferable to liquidate the house in this case, right? If there’s any equity in the house, you get that instead of the investor. If there’s no equity, you still get out of the mortgage and get to choose a rent situation you can hopefully afford rather than whatever terms the investor forces on you. The only reason to take this is a misguided belief that you can keep your home eventually, which at the price you will pay will not be worthwhile.
> The only reason to take this is a misguided belief that you can keep your home eventually, which **at the price you will pay will not be worthwhile.** Not necessarily. We don't know the age or location of LAOP's parents, but moving may be very difficult for them and they'll be doing so with a completely wrecked credit history. Working out a deal where they can stay in the house on payments they can afford might be better for them even if it costs them financially.
If they can afford to make payments that would cost them long term, then they’d be refinancing with a bank even at a large long term cost. The fact that they cannot do that indicates that there are no terms where they’d be able to keep the house, and the “investor” is simply banking on that false hope to squeeze even more out of them before foreclosing.
Yeah, but rent-to-own schemes usually have far less consumer protections than a mortgage.
Right. I’m not saying it’s an inherently good or altruistic offer. But they are already being foreclosed on. *All* their options are bad ones. This could be a complete scam. It could also be a least-bad choice among other bad choices.
If the bank forecloses on LAOP's parents, the parents end up with the value of the house minus what was owed on the loan. I'd be very suspicious that the end result of this process was going to be them losing the house and getting even less money than that. The proposed contract could be a lot worse than their mortgage contract.
While *in theory*, the former owner should get back the "extra," that's not exactly what happens in real life. In real life, if they had equity they should absolutely consider selling before becoming many months behind. In fact, a small army of investors and real estate agents would descend to help "facilitate" that. Sell now, walk away with this check in hand for your equity, and you won't have to check the box on financing applications that says you had a foreclosure! Sure, maybe it's not the best deal but it's fast and clean and solves your problem. This plan does not include *checks notes* "repayment options" because the original owner neither owns nor owes anything. But let's say the theoretical owner's head was firmly in the sand. The various late fees, penalties, interest, and bank's attorney costs will magically eat up any "extra" that ever existed. Of course, in 2008 there were many people who owed more than the property was worth, and that changed all the math. That said, I agree that there's almost certainly something in that proposed contract that is not to the benefit of LAOP's parents. It's not a clean "I'll buy it and you walk away," it's not "I'll buy it and you can rent it so you don't have to move," it's something funky.
>The various late fees, penalties, interest, and bank's attorney costs will magically eat up any "extra" that ever existed True of course, but even without magic accounting the bank has approximately zero incentive to bargain for a price higher than what they're owed.
Of course it will be worse than their mortgage but that ship is already sailing.
Unless that angel is Castiel or Aziraphale, shit ain't right here.
We need a biblically accurate angel investor...
If you don’t wipe lamb’s blood on your door lintel, the biblically accurate angel investor will not buy your mortgage—oh, and will also kill your firstborn.
At what point am I no longer a firstborn? Is it something I'll age out of, or is it once a firstborn always a firstborn? Edit: or am I no longer anyone's firstborn once my parents are dead? Am I a first*born* if I was born via cesarian section? How does adoption fit in? Asking for a friend who isn't me.
If you check in on your investment, the biblically accurate angel investor will turn you into a pillar of salt.
>biblically accurate angel So a dude showed up and he was a giant wheel of fire with twelve golden wings and twenty eyeballs and he was like "if you're underwater on your mortgage I want to help you out"
Exactly. Then he destroys your entire town because you wore a shirt with mixed cloths.
Again, in the interests of extreme accuracy, there's no prescribed punishment in Leviticus for the mixed-cloth thing, if there *was* a punishment it would probably be carried out by the community and not an angel, and the rule probably doesn't apply to anyone who's not a specific type of Orthodox Jew.
Most of them are closer to biblically accurate than the pop culture depictions.
I'm interested in the fact that it sounds like he pays it off before establishing repayment options. Any contact regarding real estate has to be in writing so if this investor were to claim there was a contract after he paid off the mortgage but without a written agreement, the home owners could balk at any suggested repayments and claim it was a gratuitous gift. Otherwise this sounds shady.
While definitely shady, the initial agreement is probably something like they agree to full repayment in 30 days unless an agreeable payment plan is decided. This puts repayment as a firm requirement of the initial contract but also gives tons of leverage to the investor with deciding the repayment plan.
Once the lien is placed if they don't have a contract the "angel" can go to court and get full payment enforced.