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In Las Vegas at that time there was a law on the books that specifically forbade the person on the note, or anyone related to that person, to buy the note in a
by ChuckMcM 8y ago
In Las Vegas at that time there was a law on the books that specifically forbade the person on the note, or anyone related to that person, to buy the note in a short sale or at auction. It was written to prevent scams where people could pump up their house value and get refinanced, default, and then buy the house back at a discount and pocket the difference.
It was amended in 2016 I believe to allow some purchases if they met specific criteria.
The "usual" way to getting around these things has been to create a company and have the company buy it. Companies are nominally 'new' people and don't have family or relatives.
- brian-armstrong 8y agoIt sounds like companies might get very lonely at Christmas.
- uiri 8y agoThere are typically laws that deem a company to be related to a person if that person and their (natural) relatives own some threshold percentage of that company.
- kmonsen 8y agoI don't see how you call this a scam. The bank should do due diligence before handing out the loan. It's not like the bank is forced to hand out money for bad deals.
- ChuckMcM 8y agoI don't disagree, it is always a question of degree. One party sees a 'scam', the other a failure of the first party to do more diligence. Some see separating poorly informed people from their money as a business, other see it as an injustice that needs to be corrected.
- Dylan16807 8y agoThe scam part is taking out a loan with the intent of not repaying it.