Real Estate Scam?

Talk about anything here. Post lifespan is 1 year.

Postby samuraiwriter on Mon Jul 10, 2017 10:59 pm

I am researching something, and thought I'd open it up to EB'ers in hopes of gaining an understanding of a situation I do not understand.

(All names have been changed.)

Frank Blair runs a mobile ministry, and a woman named Margaret Corden is listed as a principal. Together, they bought an old restaurant in Kalamazoo in 2009 for $1.5 million and defaulted on the loan in 2013.

The mobile ministry mortgaged it to "King Investment of Kalamazoo LLC" for $1.2 million and to America National Bank for $300K. "King Investment of Kalamazoo LLC" is owned by Jane Corden.

Jane Corden is the wife of Doug Corden. Doug Corden is also the brother of Margaret Corden.


For those in the know, what do you make of this?

I should say that Doug Corden is well known as a fraudster. One who has paid over 10 Million to settle a single case.
samuraiwriter
Art Expert
 
Status: Active
Posts: 2668
Joined: Fri Nov 10, 2006 2:00 am

Postby virtualj on Mon Jul 10, 2017 11:07 pm

Where does the ten mil come into play?

It's always Colonel mustard in the study with the candlestick, btw.
User avatar
virtualj
Art Connoisseur
 
Status: Banned !
Posts: 460
Joined: Tue Jan 24, 2017 4:11 pm
I donate anonymously.

Postby samuraiwriter on Mon Jul 10, 2017 11:19 pm

virtualj wrote:Where does the ten mil come into play?


About 15 years ago Corden was popped by the Feds for an entitlement scam related to his once publicly traded company.
samuraiwriter
Art Expert
 
Status: Active
Posts: 2668
Joined: Fri Nov 10, 2006 2:00 am

Postby maskoff on Mon Jul 17, 2017 10:22 am

I'm very interested in this and I may have some information, but I would like to see what other EB-ers got to say first..
User avatar
maskoff
New User
 
Status: Active
Posts: 1
Joined: Mon Jul 17, 2017 10:17 am

Postby samuraiwriter on Mon Jul 17, 2017 2:27 pm

All theories welcomed. :pint:
samuraiwriter
Art Expert
 
Status: Active
Posts: 2668
Joined: Fri Nov 10, 2006 2:00 am

Postby iwokeinrelief on Mon Jul 17, 2017 2:54 pm

samuraiwriter wrote:I am researching something, and thought I'd open it up to EB'ers in hopes of gaining an understanding of a situation I do not understand.

(All names have been changed.)

Frank Blair runs a mobile ministry, and a woman named Margaret Corden is listed as a principal. Together, they bought an old restaurant in Kalamazoo in 2009 for $1.5 million and defaulted on the loan in 2013.

The mobile ministry mortgaged it to "King Investment of Kalamazoo LLC" for $1.2 million and to America National Bank for $300K. "King Investment of Kalamazoo LLC" is owned by Jane Corden.

Jane Corden is the wife of Doug Corden. Doug Corden is also the brother of Margaret Corden.

Not sure if you're mixing up terms, or if how you've described it above is how it occurred. It makes a difference, so let me explain a bit. When you buy a property (in this case the restaurant) you obtain the Deed to the property (the land) and everything attached (i.e.: the building). You can purchase via cash, in which case you simply obtain the deed - or you can obtain a loan in which case a lien is recorded on the property. This lien needs to be paid off if you ever want to transfer the Deed to someone else - it also tends to have some clause included where a default can lead to forfeiture of the property (typically via foreclosure).

So, from what you've said above, they purchased the property in 2009 (at which point they would have acquired the Deed to the property) - since you state they "defaulted" it follows that they also obtained financing of some sort - upon default the lender would likely begin foreclosure proceedings. Depending on the state (and how good the purchasers are at delaying) this could take a while.

Fast forward to: The mobile ministry mortgaged it to "King Investment of Kalamazoo LLC" for $1.2 million and to America National Bank for $300K. "King Investment of Kalamazoo LLC" is owned by Jane Corden.

To be fair, this isn't really possible. The lender owns the mortgage, so the mobile ministry (who is only the deed holder) can't "mortgage" anything - now, they can transfer the deed; but in order to do that the original lien would need to be paid off. Where you describe two different amounts, it appears they sold/deeded the property for $1.5 million, which would go to the original lender to remove the deed. The new lender(s) - probably one lender with an 80/20 loan - would then record a lien for each deed on the property. I recognize that the "King Investment of Kalamazoo LLC" entity is owned by the same people (or relatives), but the money would still have to exist to pay off the original lender - not only that, but since you've referenced a "mortgage" I have to assume these are just 2 new loans.

Nothing terribly squirrely there - there is still $1.5 million owed on the property; if they default it will still follow the same foreclosure path.
User avatar
iwokeinrelief
Art Expert
 
Status: Active
Posts: 1640
Joined: Thu Aug 21, 2014 10:04 pm
Location: DALLAS

Postby dolamite24 on Mon Jul 17, 2017 3:09 pm

Yeah but will it flip?
User avatar
dolamite24
Art Connoisseur
 
Status: Active
Posts: 610
Joined: Wed Jun 12, 2013 2:33 pm

Postby samuraiwriter on Mon Jul 17, 2017 3:14 pm

dolamite24 wrote:Yeah but will it flip?


In this case, yes.
samuraiwriter
Art Expert
 
Status: Active
Posts: 2668
Joined: Fri Nov 10, 2006 2:00 am

Postby apalma27 on Mon Jul 17, 2017 4:42 pm

samuraiwriter wrote:I am researching something, and thought I'd open it up to EB'ers in hopes of gaining an understanding of a situation I do not understand.

(All names have been changed.)

Frank Blair runs a mobile ministry, and a woman named Margaret Corden is listed as a principal. Together, they bought an old restaurant in Kalamazoo in 2009 for $1.5 million and defaulted on the loan in 2013.

The mobile ministry mortgaged it to "King Investment of Kalamazoo LLC" for $1.2 million and to America National Bank for $300K. "King Investment of Kalamazoo LLC" is owned by Jane Corden.

Jane Corden is the wife of Doug Corden. Doug Corden is also the brother of Margaret Corden.


For those in the know, what do you make of this?

I should say that Doug Corden is well known as a fraudster. One who has paid over 10 Million to settle a single case.


Did Jane Corden take any of the 1.5 million as cash at closing?
Is the loan non-recourse? Meaning no guarantors. If no one guaranteed the loan and the borrower is an entity that goes belly up, then it's on the bank. Banks don't give out loans without some piece of collateral. Unless, it's a non-recourse loan.
User avatar
apalma27
Art Connoisseur
 
Status: Active
Posts: 596
Joined: Thu Aug 23, 2012 10:57 pm
Location: New Hampshire

Postby samuraiwriter on Tue Jul 18, 2017 12:16 am

apalma27 wrote:Did Jane Corden take any of the 1.5 million as cash at closing?
Is the loan non-recourse? Meaning no guarantors. If no one guaranteed the loan and the borrower is an entity that goes belly up, then it's on the bank. Banks don't give out loans without some piece of collateral. Unless, it's a non-recourse loan.


Good question. Is that something that can be gleaned from public records? Say a property appraiser website, tax collector, civil case?
samuraiwriter
Art Expert
 
Status: Active
Posts: 2668
Joined: Fri Nov 10, 2006 2:00 am


Return to Anything Goes



Who is online

Users browsing this forum: KSUvet, PaulSeal5, piper27, sidewaysscott and 27 guests