Deed in Lieu of Foreclosure Sent

Quick update… I notarized and sent the Deed In Lieu of Foreclosure out today. The lender should get it Monday morning. The Trustee Sale is on Tuesday. Hopefully it will work out. Find out more on the show tonight.

Coming soon… my official response to Ramit Sethi, Prlinkbiz and to your latest comments…

Filed under deals, foreclosure, Dallas
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39 Comments

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1. digerati
November 3rd, 2006 at 7:21 pm

Great! One more property almost done with.

Successful Personal Finance Blog
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2. Realist
November 3rd, 2006 at 7:22 pm

Great!

Good, concise, factual update!

Good luck.
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3. Realist
November 3rd, 2006 at 8:02 pm

Edward Allen - do you understand what the “net” in net worth means? It means assets - liabilities. His net worth probably doesn’t change much with the DIL.

Before the DIL, the house was contributing to a NEGATIVE net worth (he owed more than it was worth). If it was worth 310K as you say, probably someone would have paid him 310K for the property.
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4. Editor
November 3rd, 2006 at 8:46 pm

Casey,

You told the HML 7 days ago “I’ll get right on it”. Have you been in communication with him since then?

Do you believe that all the following will occur and thus stop the foreclosure on Tuesday?
- DIL will arrive on Monday (i.e did you physically send it marked for early AM, late AM or PM Monday delivery?) FAX today with FedEx to follow Monday?
- DIL is completed to HML requirements
- HML knows to look for it Monday
- HML is in office on Monday
- HML will have/take the time on Monday to stop the foreclosure
- Texas authorities will get notice from HML in time

You wasted a week (no suprise here) - hope it doesn’t cost you!
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5. yneone
November 3rd, 2006 at 9:05 pm

Casey, you are doing the right thing. Its not as if you have that many options anyway. You need to do whats in your best interest at this point. All these naysayers, not naming names, saying how you’re gettting a bum deal obviously can’t even imagine being in your shoes. I think you are on the right track. I’m hopeful that you will get outta this mess somehow. AND, I am anxiously waiting for your story to be broadcast on television. Are you listening FOX, CBS, NBC???? This makes for good television. Casey should have had his own reality TV show by now. Good luck Casey.
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6. Dan
November 3rd, 2006 at 9:41 pm

PS… please tell me that wasn’t YOU posting the Pyramid scheme in Google Message Boards?

PLEASE!!!
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7. Lou Minatti
November 3rd, 2006 at 10:24 pm

Casey, I have to congratulate you. I have said for weeks now that I think you will escape the trap you are in. There are thousands of people out there just like you who are facing very dark times. But you are Internet-savvy and publicity-savvy, so you will avoid the abject misery that awaits the other fools. Your problems also appeared early. You had problems early in the downturn, while most FBs will be doomed 2007-2008 as their mortgages reset.

I agree with some of the other comments, though. You look stressed. You are 24 for Christ’s sake. Go eat some food, and go to Walmart or Target and buy some new business/casual wear.
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8. thehollowman
November 3rd, 2006 at 11:17 pm

Casey, I think you may finally be understanding the depth of your plight. Have you contacted your lender to make sure he knows that the contract is on its way? You need to make sure that all of your bases are covered.
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9. Deodand
November 4th, 2006 at 12:04 am

Dan, you are a clown. You mingle personal religious bias with unfounded and ridiculous business propositions. You believe in this absurd real estate bubble, you believe in this shady-dealing morally bankrupt loan liar, you believe that by praying and signing your posts with a bunch of insincere nonsense you somehow grab the moral high ground in a debate. You are mistaken, you are a fool, and you know it.

If you profess to be such a Christian, then you know what the vice of greed is, and the bromide about camels and needles.

You and your morally bankrupt criminal blog buddy are camels, trying to slip your increasingly bloated fraudulence through a diminishingly small needle.

There are no Real Estate suckers left. Nobody is going to buy Casey’s garbage, overvalued, overpriced junk homes. Ok, maybe Dan will. Maybe Dan can rip off the senior citizens in his Church with a spam “friends and family” email begging for money to sink into some broken real estate scheme.
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10. Realist
November 4th, 2006 at 6:08 am

Edward Allen - another question for you (I’m not a RE expert, so I don’t know):

What’s the difference between a DIL Monday and a Foreclosure Tuesday relative to your comments?
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11. Misstrial
November 4th, 2006 at 8:46 am

I hope that wasn’t you posing as RK on myebid.com

If so, please take note that:

1) “Shill bidding” is illegal. Enclosed please find a link to eBay where shill bidding is defined. Also, please see the reference to “Law Enforcement” near the bottom of the linked page:

http://pages.ebay.com/help/pol.....dding.html

2) It is possible that RK is the Trademark Owner of his name. If so, there may be a legal dispute over the unlawful use of his name related to the myebid auction.

Question for Casey: If you sold your properties as a bundled sale on myebid.com, then why do you need to do a DIL for the sole Texas property? Is there not a new owner of the(se) properties? Someone please explain this to me. Thanks!

~Misstrial, copyright 2006
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12. Dan
November 4th, 2006 at 9:48 am

Deodand,

It must be nice to know everything about everything. I wish I could be like you.

My post above was not encouraging Casey or anyone to do “shady deals” or “liar loans”. It was simply to encourage Casey because he did the best he could with the Texas house and then to ask him to be more straight foreward in his future deals.

I hope Casey can dig himself out of this with “only” credit report troubles in the end. His credit would be fine again by age 30 or 35, if he gets a felony conviction, that’s for life and I wouldn’t wish that on someone like him.

I honestly don’t know where you get off screetching about business you obviously know very little about. People will buy Casey’s homes at some price, not at the prices he paid for them in January. There will certainly be big losses for the banks and Casey to deal with. There’s nothing for Casey to do but “clean up the mess” and that appears to be the direction he’s heading, though not as quickly or honestly as some of his supporters may have hoped.
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13. SCapitalist
November 4th, 2006 at 9:49 am

Casey,

This is my first post on your site, and frankly, I would like to congratulate you. But first, let me explain.

We have very similar ways of thinking. My goal is to start a real estate investment company as well, and I am 23. However, I would prefer to start my company and solid legal ground and have much less aversion to risk. While I think that many of the things you did are wrong, fraudulent, and stupid; I can’t help but encourage you to follow your dreams.

The congratulations stems from the way you are handling all the nay-sayers, cynics, and overall negativity coming at you. You are under an enormous about of pressure, and you are MAKING THINGS HAPPEN! You have gaining national media exposure and are finding creative solutions to your problems. Given that a smarter, more experienced person wouldn’t be in your position, a weaker person would have already given up. And for that reason, I wish you all the best. I will be following your saga as it unfolds.
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14. Unbelievable
November 4th, 2006 at 9:50 am

Well Misstrial, Don’t you think it’s fairly obvious that Casey shilled his auction since he is still doing a DIL on the Texas property ? It is a shame that he didn’t know when to stop, Golden Palace is a real bidder. If you looked in the dictionary under the definition of moron, you’ll see a picture of Casey.
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15. Jack
November 4th, 2006 at 10:26 am

interesting…. Edward Allen,

buying assets is the way to go you say, but in the same post you mention that Casey’s assets are declining 2 grand a week per asset.
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16. edward allen
November 4th, 2006 at 10:35 am

Silly Realist:
“It is not how much you make that counts, it’s how much you keep.” That’s the central point RK makes. “What puts money in your pocket is an asset. What takes out money is a liability.”
In other words, as long as he held the Texas property it was an asset, but the moment he got rid of it it became a liability — more so because Casey has written that the Texas property tax bill is triggered when it is sold. Again I should refer to you RK’s writings for a more full-throated explanation.
The difference between a DIL and a foreclosure is that the DIL is now going to happen next week. Foreclosure was something Casey could have fought off to keep his assets longer. Might have happened, might not.
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17. Realist
November 4th, 2006 at 10:52 am

Edward Allen - thanks for the detailed explanation of RK’s philosophy.

So, by RK’s definition of assets ”those things that generate money, such as properties or businesses” - none of Casey’s properties are assets. They are all liabilities “annoying things that cost money, such as payments “. He paid too much for upside down properties and has not found a way to make them generate money. I think I’ve got it! Right?

Yours,
Silly
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18. Max Stein
November 4th, 2006 at 10:57 am

Misstrial,

Casey already explained on another post he did not create this auction. With the amount of information on this site, some jokester with too much time on their hands, created the Myebid auction.

BTW, Misstrial, are you a paralegal student?

Max
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19. HN
November 4th, 2006 at 11:51 am

Ms. Misstrial’s points are very relevant; and her politeness and coherence are admirable. Whoever playing RK and CS on myebid may be getting his/herself in a whole lot of troubles.

I really enjoy reading Ms. Misstrial’s comments to Ms. prlinkbz (of nolimitsladies blog), Mr. RK and his associates.

http://iamfacingforeclosure.co.....-investor/
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20. Free advice
November 4th, 2006 at 11:53 am

Casey’s properties are declining in value at a rate of $10,000 per week.

If he buys 5 more houses, then he can have his properties decline in value by $20,000 per week.

If he buys 50 more houses, then he can have his properties decline in value by $200,000 per week.

I like this “new economics.” Makes good sense.
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21. edward allen
November 4th, 2006 at 1:24 pm

Silly Realist: You may almost have a grasp of the enormity of it. But you really have to discard your negative and ancient way of thinking of assets, and think like RK to make any sense out of this at all.
RK’s basic premise is to discard those old Europe ideas of accumulating wealth and cash flow, and embrace the new economy. “It’s not the numbers, but what the numbers are telling you,'’ RK says. Traditional ways of judging wealth are outdated: “One of the main reasons net worth is not accurate is simply because the moment you begin selling your assets, you are taxed for any gains.”
So it seems you can generate wealth by quitting your job and starting to accumulate property. This is not a problem and RK encourages this (he’s especially distainful of college degrees). Using Realist’s outdrated ways of thinking, some might excuse you for believing that being jobless would cause difficulties in buying houses, but here we have proof in the case of Casey and the Denver Post had a story last Sunday about a prison escape who bought five houses _ two while he was in jail _ because the banks and mortgage brokers simply aren’t bothering with background checks (the reporter omits saying how the prisoner managed to close on the contracts from behind bars).
Where I think your logic falls down is you insist not counting Casey’s portfolio as an asset. You seem to believe somehow the properties are a liability. Silly Realist. RK would ask why should this be? It looks like no payments have been made, and he still legally owns them, so under RK’s counting system, he’s worth $2.2 million. “Simple math and common sense is all that is needed to do well financially,” RK tells us.
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22. Doh!
November 4th, 2006 at 2:04 pm

In regards to your ‘official responses’: a simple “I was wrong, oops! I now see the error of my ways” isn’t going to cut it anymore, at least not with the Ramit Sethi thing. You already blogged that tune in September before you sent the email, remember? The non disclosure agreement with Prlinkbiz makes me think they weren’t being any more honest than you are, but the Sethi email scam is disgusting, shameful, and a credibility killer.

http://www.iwillteachyoutoberi.....ision.html

Also, I notice that the majority of the comments on the blog now are the same people arguing amongst themselves. I think the majority of the casual readers have quickly identified you for what you really are (a scammer) and have moved on. A lot of pie in the sky talk and as yet no action to back it up.

Shouldn’t you have a plan to get out of this mess by now? Where the hell is it? Oh yeah, I forgot, you’ve been too busy keeping your PMA and ‘MAKING THINGS HAPPEN’ to formulate one. Good luck ‘rebuilding’ your unsuccessful RE biz.
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23. 2020 hindsite
November 4th, 2006 at 2:08 pm

I think your aspirations of being a real estate investor have been flushed down the toilet.
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24. Misstrial
November 4th, 2006 at 2:10 pm

Well, I must admit that I have not seen spin, twists, turns, admissions, denials, ambiguities, vagueness like this before. Not even in criminal or civil court or in deposition. Ever.

All I can say is this: if this set of facts, as presented on this Board ever comes before a judge, then sentencing will be rough.

Unbelievable: lol! To tell you the truth, I just wasn’t sure. Things are getting convoluted, especially with the explanation by “prlinkbiz” of what went down in PHX. After all that, it seemed strange that the real RK would invest 2M to help a questionable person. Nevertheless, its an interesting set of circumstances to deconstruct. (Love your posts, btw!)

Max Stein: Hello, sir… No, I am not a paralegal student. :) I would give you more info, but I am semi-well-known and could be recognized by members of the legal community in my State and in DC.

HN: Thank you for your considerate remarks. I really try to show respect for everyone. All of us have and are trying to help dear old Casey. Some of us are more direct/blunt than others, but I think that has to do with the seriousness of his circumstances. I don’t think we are always getting through to him to make thought-process contact, but hopefully, someone else in similar straits and reading the posts may “see the light” and do the right thing.

~Misstrial, copyright 2006
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25. anonymous nerd
November 4th, 2006 at 2:34 pm

Casey, the cross-section of commentors on your site is awesome. You’ve got your neanderthal all-cappers, poorly disguised real-estate shills, religious zealots, comment copyrighters, anonymous internet ‘experts’, conspiracy theorists, competing blog spammers, etc. all living together in perfect disharmony. This would make a kickass forum!

My only suggestion is that if everyone could keep their brilliant musings relatively short, that would really help out those of us with ADD. Thanks!

~ copyright 2006 all rights reserved by IP 126.207.96.22
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26. NoVa Sideliner
November 4th, 2006 at 2:50 pm

You go, Realist! I don’t know what Edward Alien is on about with leverage and assets. I always thought leverage was good when you pick the right market direction, and very bad when you pick it wrongly. And as you so rightly point out, in RK’s eyes, this Texas property (indeed, all of them) are now RK-style liabilities, costing him like the payment on a leased BMW that sits in the garage. What to do with liabilities like that? Dump ‘em.

Now if there was a reasonable hope of hanging onto them and turning a profit, things might be different, but the wait for turning even a nominal profit is moot: The properties will all be taken from him before the market would ever have a chance to recover, whether next year or ten years from now. Cut losses now, or owe even more later.

As for owing taxes on short sales and the like, if I remember correctly, the IRS will not count short sales (or similar forgiven debt) as income if you are insolvent. And you sure seem to be. More on this later if I get time to detail it more, or ask your tax attorney (you do have one, right, Casey?).

I’d also like to mention that I watched one of RK’s presentations on a BPS fundraiser some time back, in the process losing a lot of respect for PBS’s choice of programming, but at the same time having belly-ache-inducing lauighing fits over his new, made-up definitions of assets and liabilities, among other things. I’m no accountant, but his terminology struck me as completely ridiculous. And he was, as mentioned before, long on motivation and short on substance.

Casey, I really do hope that you haven’t made a mistake by pondering so long before sending in the Deed In Lieu. Once an offer like that is available, you really need to get on it ASAP. The wheels of office administration can turn slowly, too slowly in some cases, and since they are under no obligation to accept a deed-in-lieu, they might not actually cancel the grinder that might soon be chewing you up. I do hope it works out. Keep us posted.
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27. breakdown
November 4th, 2006 at 3:07 pm

Casey,

Correct me if I’m wrong but you tried to create value by recognizing and unlocking “potential” value in a house. You purchase a house for $200k, add new new kitchen & landscaping, say $15k, then the house is magically worth $250k.

Thus, even if the market price of houses is declining, you will be able to make money if you can correctly recognize these undervalued situations.

However, I think your strategy will not work in a declining market. When the market is going up the seller of a “not so perfect” house is thrilled to get any kind of profit (low expectations, easily achieved). When the market is going down, the seller is likely not going to want to leave $ on the table. They will have adapted their expectations to recent high prices. They will take the advice of the realtor (paint, clean, improve, etc.). I would also argue there will be less variance in sellers’ asking prices. But to the point, the effective SPREAD in price between an “unimproved house” and an “improved house” will likely shrink as the prices turn south.

I’ve been a homeowner/homebuyer for 20+ years… I’m not a speculator but in the past when I’ve made purchasing decisions they have taken 9-12 months so I like to think that I got very educated on the market… I’m alarmed at recent terminology i’m hearing, like buying homes “wholesale”, This simply did not exist 10 years ago. I think people are fooling themselves to think the housing market will remain this “ineffecient” as it was in the recent run up. When times get tight, people pay attention to details & stop leaving $ on the table. Prices will converge and less oportunities for smart buyers will be found.
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28. Realist
November 4th, 2006 at 3:12 pm

E Allen: So the way to fix a $10K/week decline in market value of RE during this “adjustment/decline” is to just buy MORE properties? Kind of like “make it up in volume”, huh? Just plain silly in my mind…..

Rule #1 when in a deep hole you can’t get out of - ’stop digging’!
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29. Falconer
November 4th, 2006 at 3:14 pm

Casey,

Re “Coming soon… my official response to Ramit Sethi, Prlinkbiz and to your latest comments…”

When is “soon”? It’s been 24 hours now.

TIA
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30. Falconer
November 4th, 2006 at 4:27 pm

Yawn - Casey, I know you’re there as posts are being moderated. It’s been a long time since you’ve answered our questions……
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31. kpom
November 4th, 2006 at 5:06 pm

~ copyright 2006 all rights reserved
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32. Unbelievable
November 4th, 2006 at 5:30 pm

Yawn is right…………………..
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33. Free advice
November 4th, 2006 at 6:26 pm

No Ed, I don’t think you quite get it.

Whether Casey keeps his house in Texas or gets rid of it, Texas gets its taxes. I’m pretty sure they’re pretty strict about that. So when the bill’s due, that’s a liability either way. It’s not “triggered when sold.”

You seem to want some assets. Why don’t you buy Casey’s Texas house for $310K? I’m sure Mr. Hard Money Lender would be most happy to oblige.
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34. Brock
November 4th, 2006 at 7:53 pm

edward allen, you should write satire professionally.

Realist, take note.
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35. moom
November 5th, 2006 at 4:59 am

I’ve read several RK books…. What Allen is writing is either a satire or he doesn’t understand what RK wrote. As others have commented, RK is all about cash flow when it comes to real estate… Casey’s first mistake was buying to flip rather than rent out. Second a year or more back RK said to get out of real estate. He isn’t into buying declining assets for “leverage”. On college - he went to college himself- he also got jobs - he sees this all as useful skill acquisition to then become and entrepreneur. RK writes lots of stuff which is rather dubious in his books but the core ideas are pretty solid actually. I was just reading John Mauldin yesterday and he made a point pretty much identical with a core RK point - if you can’t sell your business for cash you don’t have a business in an economic sense but are self-employed. Most of RK’s ideas are repeated in other books on investing and business. They aren’t wacky ideas like dig yourself more into debt. On MLMs RK says they are useful to get experience in selling. For some reason he wants to be nice to those guys…
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36. Prison is the only teacher that will get through
November 5th, 2006 at 7:47 pm

Serin is obviously not learning anything from the occasional good posts I’ve seen around here. He’s gotten some advice from bankruptcy and criminal defense attorneys and he still keeps going with this arrogant blog. Reminds me of Skilling of Enron, who still insists he did nothing wrong, despite the fact that his fraud obviously hurt a lot of people. Serin’s fraud also caused great damage to real people–taxpayers who will pay his bills, the banking system, and people who got stuck with higher mortgages because of the artificial run-up in prices caused by people playing with other people’s money (heads I win, tails you lose). Only some time with Rufus and Jose in Federal prison for mortgage fraud will cause a change of heart for Serin. As an aside, I know someone who spent two years in prison for mortgage fraud after the S&L crisis (early nineties). It took a while (years) for the prosecution to get started, but eventually the system worked. It will work this time too.