The Mortgage Broker from Hell!

Be careful what you wish for, because you just might get it! My first listing as a Realtor was a FSBO (For Sale By Owner) in my neighborhood. I remember driving by when I first saw the sign and thinking, I wish I could get that listing. The new owner was a doctor who had just bought the home at auction for investment purposes. After doing some renovations and trying to sell for several months as a FSBO, I finally convinced him to give me the listing, through sheer persistence. Before signing on the dotted line, however, the new owner told me: “I have one prospect who says he is going to make an offer on the property any day now, and I don’t want to have to pay a commission if I sell it to him.” I said: “No problem, we’ll simply add Mr. Prospect’s name as an exclusion to the listing agreement.” BIG MISTAKE!

We originally listed at $489,00o and within the first month got an offer through another Realtor in my office for $455K, which the seller countered at $465K and the deal fell through. Shortly thereafter, one evening I received a call from a neighbor of the listed home, which was vacant, that an intruder was vandalizing the home at that very moment! I immediately showed up to find a very tall man who I had never seen before, prying off the ornamental ironwork from each window, one by one, with a crowbar and sledge hammer.

“Who are you and what are you doing” I said as I confronted him.

“I am a mortgage broker. This house has just been sold and the mortgage company refuses to issue a loan unless this ironwork, which is a fire hazard, is all removed” he said. “Well, I’m the Realtor and if this house has been sold, no one has bothered to tell me.” After trying unsuccessfully to reach the seller by telephone, I then decided to call the police. Three, City of Miami squad cards showed up to assess the situation. After about half an hour, Crowbar Man (let us call him Roberto) was finally able to reach the owner on his cellular phone, who then told me that the property had indeed been sold, that he had accepted an offer from the prospect whom we had originally excluded on the listing agreement for $430K, and that it was alright for Crowbar Man (actually the mortgage broker financing the transaction) to continue his hammer wielding ways.

The next day, I went to see the owner, and he apologized for not notifying me of the situation and thanked me for all my help. He said he appreciated my initiative in calling the police and trying to protect his best interests in the property, and went on to say that he had once owned another investment property in Miami that subsequently burned to the ground, and no one had bothered calling either him or the Fire Department for that matter. “If you had been my Realtor, that house would have never burned down!”

Hindsight is 20/20, I thought to myself.

He then proceeded to give me a check, payable to CASH for $1000, which he said was for all my trouble and expenses. If there is one thing I learned in R.E. School, it is that you don’t cash a check that a seller gives you, so the next morning I gave the check to my manager, who told me that it had to be made payable to EWM in order to be processed.

I went back to the seller and told him I needed a new check. He said: “I can’t believe you didn’t just cash the check, I never thought I’d meet an honest Realtor in Miami!”

“Well you have now!” I told him.

“My wife writes all my checks and has my checkbook, I’ll call you when the new check is ready.” he said.

To this day, I am still waiting for that call and for that check!

As it turns out, the home finally closed and according to the seller, when he sat down at the closing table, the sales price of record for this home (which I listed for $489K and which supposedly had sold for $430K) was $600,000. According to the closing statement the seller received his $430K and the difference of $170K was paid to someone, I don’t know who, as an existing mortgage (which really didn’t exist) on the property. As a result, the seller, after checking with his attorney, realized that he would now be required to pay income tax on the net gain realized by him on the sale of the property using the fictitious figure on the official sale of record. The last I heard, the seller was trying to have the sale set aside and expose the entire affair.

“I should have accepted the offer you presented me for $455K and now I wish I had.” he told me.

Hindsight is 20/20, I again thought to myself.

I am simply relieved that neither I nor EWM had anything to do with that transaction!

As a footnote, I saw Roberto(the mortgage broker) a few days after the closing as I was driving by the property, he saw me and waved me to stop, then went into his trunk and pulled out my missing EWM “FOR SALE” sign, which had mysteriously disappeared a few weeks into the listing and which I had to replace at the time.

He gave it to me and said: “Sorry man, I took your sign, I was afraid you would sell the home and I wouldn’t get to do the mortgage.”

I was speechless. After all that had happened, the only question I could think to ask was: “Roberto, why are you telling me this, now, after all this time?”

“Because” he said “I want you to see that I am your friend!” With friends like that, I thought, who needs enemies.

Some time has passed, and I have since discovered that the new owner has divided up the home, which is zoned single family, and rents it out to several families at a time.

As a result there is a perpetual “FOR RENT” sign in front of the property at all times.

Now, every day when I drive by on my way to work, I see the sign and I wonder to myself if I could ever be desperate enough to steal someone’s sign for my own personal gain.

I know the answer is that I never could, because, you see, I am an honest Realtor who works for EWM, and must answer to a higher authority!