… or a reach around deal? When does a breach of professional ethics enter the realm of criminal activity?
5510 Lausanne is listed as a short sale for $1,100,000 (great photos, by the way – made really believe). It was purchased for $1,610,000 in May 2006 after previously being sold for $1,151,210 in September 2003. Original financing was a $1,000,000 first at 6.675% 7/23 from NL, Inc. (ever heard of them?) and a $288,000 HELOC, an 80% deal. In November 2006, a new HELOC for $445,000 was taken out from WFB. A NOD was filed in October 2010 for a missed December 2009 mortgage payment, and a NOS was filed this week with a Trustee’s Sale date of 11 February 2011. Just another sad story, except the owner runs Intero Realtors. The listing history off Zillow is pretty informative when gauging their short sale expertise and their market ken:
|01/08/2011||Listed for sale *||$1,100,000||-29.0%||$241||Dickson Realty Inc.|
|10/29/2010||Listing removed *||$1,550,000||—||$340||Intero Real Estate Services|
|06/25/2010||Listed for sale *||$1,550,000||—||$340||Intero Real Estate Services|
|05/09/2010||Listing removed *||$1,550,000||—||$340||Intero Client Services|
|01/22/2010||Price change *||$1,550,000||14.8%||$340||Intero Client Services|
|12/10/2009||Price change *||$1,350,000||-20.4%||$296||Intero Client Services|
|10/04/2009||Listed for sale *||$1,695,000||5.3%||$371||Intero Client Services|
Lausanne is presented just as background. Even realtors made some bad decisions. But Mr. Intero has made a lot. If you are a data digger, take a look at these filings with the Secretary of State and run them through the Recorders site.
Where it gets really dicey on the arm’s-length issue, required by the RSAR and NNRMLS code of ethics, comes on 3389 Forest View. Intero got the listing on this short sale. The property was purchased for $749K in September 2005, well up from its 2000 purchase at $429K. Intero (Leslie Henderson) negotiated the short sale for $359,000 which closed on 19 January 2001. The all cash buyer was Zephyr Capital Funds LLC, which is a doppelgänger of the Intero owner (see his entities registered with the Nevada Secretary of State). The property listed today for $459,000.
So call me naive, but how does a person awaiting a Trustee’s Deed on his principal residence come up with the cash to buy a property out of a short sale? Is it a breach of whatever the realtor bloc actually enforces as their code of ethics to list a home, personally buy a home as a short sale, then relist it as a traditional sale? Intero presumably took standard commissions along the way.
Is this a breach of the arm’s-length” policy in real estate transaction? Is this a heinous breach of professional ethics? Do the regulating agencies even care enough to follow up? Yes, yes, no. Run a Recorder’s search on the activities of other entities for a fuller view of the misconduct involved here. There have been no repercussions.
If the RSAR and NNRMLS can turn a blind eye to these sort of ethical breaches, it calls into question the credibility of these entire professional organizations, and that of the entire profession.