12 ms·

The Ugly Truth Behind “We Buy Ugly Houses”

234 points by ilamont 3y ago

abvaw 3y ago
[flagged]
- paulryanrogers 3y ago
  If there's enough fine print to require 3+ hours of reading for someone with high-schools level comprehension... then it can easily hide exploitive terms. For seniors with dwindling mental capacity the situation is even more dire.
  - abvaw 3y ago
    If you haven't understood (or even read) what they are telling you to sign you shouldn't sign. What you can't do is sign and then complain about what you signed. That's ridiculous, and the courts agree.
    - paulryanrogers 3y ago
      Many of these people have dementia. It's not a fair negotiation.
      - abvaw 3y ago
        Contracts signed by mentally incompetent people are generally invalid. So this article isn't about that. Therefore, when the article says the courts accept the contracts as valid they can't be talking about the contracts signed by the infirm, but the article conflates both things maliciously.
        jjulius 3y ago
        I would suggest that you read the ProPublica article that is the source of the claim, which details a years-long legal battle that then ensued, before you continue. It's not as cut and dry as you would like it to be. The following is literally about a "contract signed by the infirm": >After David learned of the contract, he explained to Evans that his mother had dementia and tried to cancel the sale. Instead of walking away, Evans dug in, recording a notice on the property’s title that essentially prevented a sale to anyone else, which forced the Casanova family into a years-long battle to keep the home. Along the way, Evans disputed that Casanova showed signs of impairment during their interactions.
        ttyprintk 3y ago
        Convenient link to the original: https://news.ycombinator.com/item?id=35901056 https://news.ycombinator.com/item?id=35901056
        wilg 3y ago
        Not disputing this is fucked up shit, but it's unfortunate there's not a super clear explanation of where the legal system is failing here. In general, it seems like a huge problem that people who probably are not capable of signing contracts can in fact sign them and have no real recourse for dealing with it. Seems like a good spot for a safety net.
        Arainach 3y ago
        There is a very long history of courts having people declared mentally incompetent to enable all sorts of abuse. Being cautious in cases like this is entirely reasonable, even when it's painful.
        wilg 3y ago
        Sure, but I'm wondering if we can come up with a way to solve this problem.
        wahern 3y ago
        Which part did abvaw not understand?
        koolba 3y ago
        These scams prey upon seniors who are legally able to enter contracts but do not have the mental state to know what they are doing. Many of them are too scared or embarrassed to get help afterward as they fear they’ll be a bother or have what’s left taken away. The lesson here is to marry someone much younger so you have someone to take care of you in your twilight years. Also good to have lots of kids and raise them right. Statistically at least one of them will be able to take care of you.
        neurobama 3y ago
        The buyers do not approach those who have been legally deemed incompetent. As you say, such a sale would not be valid. But then again, can the isolated mentally incompetent even bring such cases to court? Vulnerable people who break a hip and can't afford surgery also don't deserve to lose their homes, especially not at a fraction of market value. There are clear gaps in the system which these buyers are exploiting and which you are repeatedly and willfully excusing. There's a chapter in the Bible about this type of behavior involving whips, overturned tables and an angry Jesus.
        MikeTheGreat 3y ago
        That's what makes this so brilliant, isn't it? The buyer has the signature on paper and can proceed with taking the house. The person who just sold their house _could_ contest it in court... except that they're not mentally competent so by definition they won't be able to mount a defense (i.e., realize that they just got scammed, hire a lawyer, put together a strategy, etc, etc). Brilliant! If the elderly, mentally incompetent person has _someone_else_ in their life who notices this early and jumps in to clock a lot of hours to stop this from happening, then sure - everything will be fine. If not, well, the bad guys win.
        cratermoon 3y ago
        How anyone these days can have any faith in the legal system and not see the ways the courts favor money over justice is beyond me.
        HEmanZ 3y ago
        The linked examples literally contain cases where the signer had diagnosed dementia or was tricked in an extremely dubious way (e.g “oh this is the exact same contract as last time just sign it”). And the contracts were upheld. Idk if it warrants a story beyond “existing laws not being upheld in some cases”, meaning I don’t know how much these cases apply to the whole market or most courts, but it looks like there are a fair number of seriously messed up contract scams getting through in this industry.
        colanderman 3y ago
        > Contracts signed by mentally incompetent people are generally invalid. Yes, that's why the houses are considered stolen.
        deleted 3y ago
        [deleted]
    - deleted 3y ago
      [deleted]
    - josephg 3y ago
      I'm pleased to report that the courts don't agree here in Australia. I was taught this story at university - apologies in advance if I've butchered some of the details. As I remember it, there was a famous case decades ago where a bank manager visited the home of an elderly Polish couple. The couple had a mortgage with the bank, and the bank wanted to renegotiate the terms of their mortgage. Only the wife was home, and she barely spoke any English. She understood that the man in the suit from the bank wanted them to sign some paperwork, so she did. As a co-signatory of the mortgage, her signature was enough. The couple eventually lost their home as a result, and the case went through the courts. Eventually the high court (equivalent of the supreme court in the USA) sided with the couple. They said that because the bank has more money and skill, they have more power in a negotiation like this. As a result, they bear proportionately more responsibility during contract negotiations. In this case, it was their responsibility as the powerful party to make sure the borrowers actually understood the terms they were signing. We basically only have 6 banks in Australia because of things like this. Its very difficult and expensive to open a new bank in australia because of regulatory requirements. But my impression is that the banks here are extremely careful when it comes to interacting with unsophisticated investors. They (reasonably) assume the courts will rule against them if they do anything that doesn't pass the pub test. (I am not a lawyer, this is not legal advice, etc.)
- deleted 3y ago
  [deleted]
- ftxbro 3y ago
  > "Propublica reveals homeowners with advanced dementia who signed their shaky signatures to transfer their homes for a fraction of their market value. They show how Homevestor targets neighborhoods struck by hurricanes, or whose owners are recently divorced, or sick. One whistleblower tells of how the company uses the surveillance advertising industry to locate elderly people who've broken a hip: "a 60-day countdown to death — and, possibly, a deal."" Indeed, they entered into the contract of their own volition.
  - schainks 3y ago
    There is a nuclear waste disposal site next to aboriginal villages on Orchid Island off the coast of Taiwan because someone handed a contract to a Chinese-illiterate person and said, "sign this and we will build a cannery and help your local economy, trust us." What do you call volition without symmetrical information? What happens when other people's livelihoods rely on your volition? Should vulnerable people deserve additional protections? Your comment suggests that _anyone_ has volition enough to decide whether to sign these contracts or not, and I don't see how that's the case here.
    - AndrewKemendo 3y ago
      In fact the op doesn’t even go as far as to discriminate on context! So no matter what, if you signed on the dotted line, you’re liable case closed.
    - MichaelZuo 3y ago
      No contract has ever been signed with perfectly symmetrical information. So if that's the standard then no human being has ever had volition. If you mean there's some maximum acceptable threshold of asymmetrical information then the obvious rejoinder is who gets to decide what that threshold is? (And, philosophically, how is that decided when any possible deciders, or combination of deciders, are themselves asymmetrically informed?)
      - deleted 3y ago
        [deleted]
- woodruffw 3y ago
  The article linked in the post contains several separate stories, including ones where the victim was seemingly given a separate contract to sign than the one they had originally read (or was told, under pressure, that a contract was different from what it actually contained). The law has a concept for that: deed or title theft. "Stealing" is the appropriate colloquial descriptor.
- hanoz 3y ago
  Isn't that exactly how the the greatest acts of stealing are performed?
  - ftxbro 3y ago
    Umm no, it's how capitalism works as protected under the rule of law in civilized societies.
- asdajksah2123 3y ago
  They're talking about buying houses from people who are suffering, bombarding them with advertising, and finally people who lack the mental capacity to know what they signed (the provided example in the blog, but there are far more in the original propublica article, is an elderly man who was incapable of writing their own name or naming the month of the year). But even setting that aside, I'm sure you're also absolutely fine with every "Terms and Conditions" you sign up to every time you create a free account online. So if as parodied in the South Park episode, Apple shows up to your house and insists you join their Human Centipad because it was right there in the terms and conditions you signed up to when buying an iPhone, you will happily have your mouth sown to someone else's backside because you agreed to a contract.
- AndrewKemendo 3y ago
  Is this the most empathetic response you could think of?
- bdw5204 3y ago
  A "contract" where one party is clearly not of "sound mind" is supposed to be null and void according to basic principles of contract law[0]. Tricking an elderly person with dementia or a mentally handicapped person into selling their house for half of its fair market value is reasonably characterized as "theft" or "attempted theft". The fact that a company is able to get away with stealing homes from elderly people who have dementia without these contracts being quickly voided as obviously fraudulent is all the evidence you need that the legal system is currently badly broken. These are not hard cases for a judge or a juror to consider. [0]: https://www.law.cornell.edu/wex/sound_mind_and_memory https://www.law.cornell.edu/wex/sound_mind_and_memory
- jjulius 3y ago
  Flippantly commenting about something without bothering to read what's being discussed is such a weird way to comment.
- colanderman 3y ago
  > "In August 2020, Evans pleaded guilty to two felony counts of attempted grand theft of real property." It's literally stealing.
- seattle_spring 3y ago
  Interesting that you felt the need to hide behind an alt to express this view.
- lisasays 3y ago
  It's called predatory acquisition. And it's specifically designed to look "fair" and hence more palatable to the overly credulous.
- orangepurple 3y ago
  The revolutionary film Soy Cuba also features this completely bogus line of thinking. The farmer sells over his land because he's broke then goes insane when he's evicted by the "mean capitalist" to whom he sold the farm. Somehow this forms the basis for the revolutionary spirit. People completely miss this. They just see evil capitalists under every stone.
  - AlexCornila 3y ago
    they see evil capitalists under every stone because under a amoral economic system and a high enough number of “capitalists” resorting to mischievous ways to turn a buck that’s a precautionary principle
- grayhatter 3y ago
  Your needlessly ridged, hyper literal view of the world is going to be problematic eventually. (lol ask me how I know. ) Making an unfair offer to someone, after lying and/or gaslighting them when they're desperate or vulnerable, and THEN working incredibly hard to prevent them from undoing or recovering from a mistake. Might not meet your strict definition of stealing (still possibly fraud which would count as theft), it's clearly deep into the ethics of stealing. Which is the authors point. The thesis isn't a legal one "these people have committed the crime of theft". It's an ethical one, what these people are doing is equivalent to stealing; and a just society would prevent them from getting away with this asshattery.
  - wilg 3y ago
    I'd hope that it is a legal thesis, because it doesn't seem like current law would allow this. The problem may be more in implementation details.
- AlexCornila 3y ago
  much of the claim for “freedom” rests on the ability to trick others into situations of consent that usually don’t benefit the consenting party.
- Gigachad 3y ago
  To some people; coming to a shared agreement and transferring money: stealing Shoplifting: not stealing.
tedunangst 3y ago
[flagged]
- deleted 3y ago
  [deleted]
- bequanna 3y ago
  What we need is ab unbiased third party to attest to the mental soundness of someone who agrees to sell their home far below market value.
  - wilg 3y ago
    Or something similar to public defenders for civil cases or something?
    - bequanna 3y ago
      Or hold notaries to a higher standard?
      - wilg 3y ago
        Did any of this have to be notarized I wonder?
tmm84 3y ago
I wish more older Americans understood how these people really work. My parents live in a neighborhood that has gone down hill through the years. They called up a company who did this kind of home buying. Usual visual inspections and the like went on with a quote being issued. They saw the amount was a little over the remaining mortgage which was less than the market value of the house. They decided to ahead of time wire over $20k in cash from their bank to the mortgage company then move on with the sale. The home buyer company had been notified of the mortgage payment and immediately reissued their quote minus the exact amount transferred to the mortgage company. I wish my parents had told me their plan because businesses communicate more than they used to.
- ttyprintk 3y ago
  Now and then, someone posts on HN their saga about disrupting real estate. It’s difficult, but I wonder what would help those like your parents. I wonder what it would take for eBay to auction real estate, and whether older people in 2030 would try that instead of this caveman.
  - mjh2539 3y ago
    Real estate is such a highly regulated industry with so many myriad laws governing it that you might as well ask what it would take for eBay to auction human organs.
- poulsbohemian 3y ago
  >I wish more older Americans understood how these people really work. I wish more Americans overall understood how real estate works. I see people get screwed all the time because of bad information. Here's an example: several times a year I will talk with a member of the public who will say something like "we want to work with the listing agent because then we won't have to pay as much commission" not understanding that in fact they are (assuming a traditional two sided commission offered by the seller) actually just giving that listing agent both sides of the deal. Or, similarly, they will say things like "we want to work with the listing agent because it's their listing so they will know the most about the property" again, not realizing that depending on your state, the rules for dual agency may not give you as a buyer the same representation as getting your own separate buyer's agent. In fact in some states, you may not actually be getting any representation at all, IE: they fill out the paperwork on your behalf but actually represent the seller. Those are just some trivial examples, but it's dumbfounding how many bad ideas the public has about real estate. So much of my job is hours of educating my clients apart from anything related to the actual transaction.
_8j50 3y ago
The author would prefer to verbally support "vulnerable people" instead of cash for their homes. I wonder what he thinks of foreclosures.
- strix_varius 3y ago
  I hate to respond to arguments made in bad faith, but this is so ignorant that I simply have to. If you read the article, and the excellent primary reporting it links to, you'll see that these companies are swindling people for significantly less than they would get from the open market. These people could hire a realtor and retain 95% of the value of their home. However, scams like "We buy ugly houses" blanket areas in advertisements so these folks never even get to find their market value - instead, selling for 50% or less of it. They're intentionally targeting folks who are least-likely or least-capable of protecting themselves with due diligence. I've witnessed this myself. An elderly man under full-time care, in another state, inherited a property in my neighborhood. A "franchisee" of one of these places got him to sign over the "right to buy" for a fraction of what it would have sold for in a single day on zillow or similar. I was interested in buying it, but I didn't want to end up owning something that way, so I reached out to the man directly to link him to the (much higher) estimated value. I never received a response from him: just from a "caretaker" who, I imagine, was being enriched somehow by the deal. I doubt the actual owner was ever informed. It's incredibly predatory and there's a whole industry of "how to" get into it (it being "wholesaling," or unregulated real estate brokerage): https://www.fortunebuilders.com/absentee-owner-lists/ https://www.fortunebuilders.com/absentee-owner-lists/
  - pessimizer 3y ago
    There's a libertarian idealization of predatory behavior. Apparently, when we don't restrain predators they get better and better, and more and more people become predators, and that's how we build civilization. Also those who don't become predators are getting what they deserve.
    - _8j50 3y ago
      I am not a libertarian FYI. The question is not whether predatory businesses are good or bad, the question is, so long as their advertising is not deceptive, who do you or the government think you are to take options away from people and profits from business owners? Everything from junkfoods to lotteries are "predatory" because poor people who can do better choose them by this logic. I am simply challenging you to educate people or invent a competition that is better and can advertise better. What you call predatory is a fair business practice given the responsibility of spending your money after being well informed is the consumer's responsibility while the business simply needs to not deceive or coerce consumers.
morkalork 3y ago
>One whistleblower tells of how the company uses the surveillance advertising industry to locate elderly people who've broken a hip: "a 60-day countdown to death — and, possibly, a deal." This statement right here is truly disgusting and real. It doesn't just apply exploitive contracts either. In the case where the victim is deemed incompetent by the government, this is how families have them die. You want to talk about socialist death panels? Family members with power of attorney will turn down surgery knowing full well its not only a death sentence, it's excruciatingly painful the whole time. People show more mercy to their pets.
- neilv 3y ago
  This is just barely scratching the surface of the surveillance society that our own tech industry has enthusiastically embraced, at every opportunity. Even from the very first alpha prototype or placeholder Web site we create, we almost always throw in third-party "analytics". Haven't even launched MVP, and already selling out out the privacy of our visitors.
- toast0 3y ago
  Surgery for a broken hip in an elderly patient may not do much to aid survival, depending on the patient's situation. Managing pain may be more humane than a surgery; especially if the patient is not of sound mind and may be unable to participate in rehabilitation to make use of their repaired or replaced hip. Of course, you're not allowed to request euthenasia for your relatives like you are for your pets, so it's harder to show the same type of mercy.
andrewstuart 3y ago
>> Home ownership is the American dream: In Australia, for many people the (new) Australian dream is: "One day I hope to have the income to be able to afford to pass the grueling real estate agent's suitability test to rent a house and move out of the tent/car."
- labster 3y ago
  [flagged]
  - andrewstuart 3y ago
    Mass homelessness is new to Australia. It's used to be a small number of people here and there. The obsession with owning real estate has turned our society into landlords and renters, with renters paying the mortgages on their landlords investments - mortgages which are spiraling up due to interest rate rises. Nearly all the members of parliament have extensive housing portfolios so they have disincentive to fix it. In fact recently house prices were going down, so the ALP government just fast tracked in 715,000 migrants, which has fixed that problem nicely. Australia was already in the worst housing crisis ever in its history. When asked how the 715,000 migrants will impact the housing crisis, the ALP government simply says that migration does not impact housing, and that the housing crisis is not the fault of migrants. Previously even the slightest questioning of migration risked you being labelled a racist, but with the new government fast tracking 715,000 and planning for 1.5 million migrants in the next five years, it's has become a huge community issue and many are standing up and asking why we are importing vast numbers of people when the country does not have the housing or resources to support them. The people at the bottom of society - who don't look great on a rental application form - what are they doing? I don't know what happens to them. It's awful and the ALP government really don't care. I've come to deeply hate government in general. The ALP is meant to be the left wing party that looks after ordinary people. Instead it has turned out to be just another bunch of rich politicians feathering their own nests.
    - stephen_g 3y ago
      Yes, which is why more people need to vote minor parties and independents if there are good ones in their electorates. Basically our major parties are a bit like the US - the Liberal/National coalition, like the Republicans, govern for the rich at the expense of the poor, and the Labor party (like the Democrats) just maintain the status quo but put a progressive PR spin on it... The political ratchet, where one party moves things, and the other just stops things moving back... At least our voting system actually lets minor parties win seats, which is why I think our Government is at least a bit less crazy than the States.
bmarquez 3y ago
I've seen those signs before. They were posted in rapidly gentrifying Hispanic areas, probably targeting those with weak English or financial literacy. The interesting things is that the signs appeared to be handwritten with a black marker but all of them looked exactly the same. There were commercially produced but they took the effort to hide it.
- seattle_spring 3y ago
  The jankiness is intentional. Apparently it helps weed out people that'd catch on to the scam. Someone dumb or desperate enough to call a hand-written sign is more likely to follow through to the end without getting suspicious. It's the same reason lots of spam and email scams are full of typos and bad grammar.
chasil 3y ago
I bought a local house in 2004 that suffered a failed furnace in deep winter (with great damage) for $17k. I put another $10k into it for repairs, and rented it. I started getting postcards around 2012: "I/we want to buy your house." I have a pile of them. None of them offered more than $20k. I had pandemic tenant problems; they didn't pay during the last six months, and the damage was substantial. I repaired the damage, then sold it on contract for $60k; I'm done with rental property. I'm still getting calls and postcards.
- deleted 3y ago
  [deleted]
- kennethrc 3y ago
  You need to fix your keyboard, your current one is dropping "0"s (... kidding, but where is this?!)
  - sgerenser 3y ago
    Almost anywhere in the rust belt has houses like this (well under $100k, at least back in the early 2000s). Typically they’re in rough areas of town and it’s difficult to rent them to anyone but section 8 tenants (government program that covers much or all of the rent for low income tenants).
  - chasil 3y ago
    The home in question is very near Augustana College in Rock Island, Illinois. I do a two mile walk through campus every day, schedule permitting. I did not drop any zeros. Salary.com rated this as one of the least expensive places to live in the U.S. a few times. I drive over the Mississippi twice a day, to and from work. We have the second largest airport in Illinois, but lost our budget airline (Airtran), so I use O'Hare or Midway now.
- switchbak 3y ago
  60k? Shoot, that wouldn't buy an outhouse out here in BC.
iosystem 3y ago
Reminds me of recently reading an opinion about how thrifting has been ruined by the upper middle class. The person expressed how thrifting is a necessary need when growing up poor and how the trend of thrifting in popularity among middle class has reduced the quantity of quality items to basically none. Quality of life I believe is getting worse for a lot of people regardless of how long we can force people to stay alive with medical means.
- dclowd9901 3y ago
  If anything, thrifting is about the most democratized activity there is. The bad that I see in thrifting is resellers who dedicate their whole life to combing thrift stores, estate sales and garage sales, finding items with a lot of resale value so they can hock them on EBay or in their own boutiques.
- mock-possum 3y ago
  Sounds like they were confusing a business for a charity. There are exceptions, but most thrift shops are the former.
labster 3y ago
Some discussion on the same topic which mods will hopefully merge into this post: https://news.ycombinator.com/item?id=35910310 https://news.ycombinator.com/item?id=35910310
- dang 3y ago
  Merged hither. Thanks!
bhouston 3y ago
They are a discount buyer, so it is generally a bad deal to use them and you basically shouldn't unless you have no other option. It is similar to getting a pay day loan, or selling stuff to pawn shop or keeping a balance on your VISA. You are going to get a bad deal. I don't really know what to do about it. How can you ensure people are educated enough to know that a discount buyer is a buyer who will under pay for your house? I guess you legislate away discount buyers completely? In Canada, they have regulated severely the amount of interest pay day loan companies can charge. This has led to a shrinkage in the number of pay day loan companies. So I guess some similar type of consumer protection laws could be enacted in this space.
- nekitamo 3y ago
  Legislating away discount buyers would be like legislating away payday lenders. The only thing accomplished would be to leave a hole in the market which will be filled by shady loan sharks.
  - deleted 3y ago
    [deleted]
  - refurb 3y ago
    Not sure why you’re downvoted because it’s true. People desperate enough to use payday lenders have no other options. And the high interest rates reflect the risk. Take that option away and the need doesn’t magically disappear, they just go to black market lenders where there really is no backstop at all. Far better to regulate.
    - Nursie 3y ago
      > People desperate enough to use payday lenders have no other options. Not always true, some folks misuse them for a variety of reasons. Take the option away in the UK and a friend’s boyfriend wouldn’t have been able to use an app to take out a bunch of short term loans in her name for Xbox games… So I think sometimes these facilities are used frivolously. You’re right that a portion of users in real hardship would turn to “informal” lending if these lenders were to disappear. But it feels like we as a society should come up with a better solution there really.
Nursie 3y ago
When I was leaving the UK a couple of years back, I was tempted by some of the marketing blurb from some similar organisations there. We had a house to sell, and were hoping to get it wrapped up before leaving, so "we buy all houses, we can close the deal in a few weeks, great prices offered!" sounded interesting. But then you look up people's experiences and the shady practices start to show. They give slightly low-ball offers, but nothing outrageous, 5-10% under market to hook you in. Most people who use them have some sort of extra motivation to sell and these arseholes know it, so at the last minute* they drop their offer significantly, in the region of 20-30%, and try to really screw you. So we stayed well clear! (*and there are a lot of last minutes in UK house sales, in fact several last months sometimes... our eventual sales process took about 4 months from acceptance to completion, and either party can drop out with no penalty up to roughly the last two weeks. It's a terrible system) (The above does not apply to Scotland, who have sorted this out long ago!)
- ClumsyPilot 3y ago
  > at the last minute* they drop their offer significantly, in the region of 20-30%, and try to really screw you. I feel like doing this consistently as a tactic shoyld amount to fraud and misrepresentation
dmbche 3y ago
Exchanges of over some amount of money should be supervised by a third party just to check it's not a scam - how hard could it be? I can't believe there are no safeguards for people...I can't believe it wouldn't be worth it socially
- danielmarkbruce 3y ago
  Often two people want to do a transaction without anyone else knowing about it. The US is, to a large extent, built on the idea the idea of individual freedom etc etc.
  - granshaw 3y ago
    Home sale transactions end up being public record anyway tho
    - danielmarkbruce 3y ago
      Yup, and practically speaking the IRS ends up knowing about virtually every meaningful transaction too. But, the people get to do the thing without anyone knowing they are going to do it, or stopping them doing it, or in most cases many of the details.
- 55555 3y ago
  Okay now define scam.
  - dabluecaboose 3y ago
    Yup. I can easily imagine some third-party scam police cracking down on things like "I sold my son the family home for $1" or other similar unusual (but not scam) transactions
    - mschuster91 3y ago
      An independent party (like in Germany, a notary) can at least flag suspicious activity and demand explanation or verify if the parties are authorized to act and of sound mind.
devmor 3y ago
I feel like this is just a foreseeable consequence of any for-profit organization that operates on "getting people out of a tight spot". If your motive is to make money, you are always going to have the incentive to take advantage of the imbalance of power created by said tight spot.
- chii 3y ago
  but is the person who needs to get out of said tight spot be worse off had no such for-profit organizations been around?
chasil 3y ago
I bought a local house in 2004 that suffered a failed furnace in deep winter (with great damage) for $17k. I put another $10k into it for repairs, and rented it. I started getting postcards around 2012: "I/we want to buy your house." I have a pile of them. None of them offered more than $20k. The home in question is very near Augustana College in Rock Island, Illinois. I do a two mile walk through campus every day, schedule permitting. The house was lost by previous owners who engaged two mortgages on the property to fund their gambling. I had pandemic tenant problems; they didn't pay during the last six months, and the damage was substantial. I repaired the damage, then sold it on contract for $60k; I'm done with rental property. I'm still getting calls and postcards. p.s. I drove by a house, very similar to mine, but with substantial roof damage, that was for sale for many months for $15k. It dropped to $5k near the end of the summer. I walk by it, going downtown, and the current owners seem to have repaired the damage, and are on their porch from time to time.
- supportengineer 3y ago
  Why are those homes so cheap?
  - PraetorianGourd 3y ago
    A mixture of: 1. The home being in a state of disrepair such that most lenders won’t fund a mortgage 2. Being located in a region where the local economy can’t support high home prices 3. Because of the lack of desirability, a lack of speculative investment.
    - chasil 3y ago
      ...and now that workers are remote and can live wherever they want, these are fair game. After driving through Port Lavaca, TX, that seems really nice. If you like snow, you will be happy with Rock Island.
      - fuzzfactor 3y ago
        If you like fishing you will be happy with Port Lavaca.
1letterunixname 3y ago
There's another legitimized scam involving foreclosures, pre-foreclosures, and outright theft: adverse possession where a 3rd-party pay some back taxes and gets the property for a song. In some municipalities, adverse possession can be used without paying back taxes to squat and legally transfer a portion of another title to a person occupying that area.
gnicholas 3y ago
> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics. Our experience with real estate agents has been far from this ideal. We had to fire one after she lied to a counterparty and then lied to us in an attempt to cover it up. Other agents weren't much better, and none of them seemed to take their fiduciary responsibility seriously. They seemed to be looking out for themselves 100% of the time, and their client only when interests were aligned. The relationship epitomizes the principle-agent problem.
- poulsbohemian 3y ago
  Real estate agent here...While there are many agents that hold themselves to the standard that the National Association of Realtors has documented in their code, one of the root problems is that state agencies are negligent in enforcing rules and investigating fraud. For example, I know a fellow agent who had documented proof of another agent committing a fraud that did approx $400K in damage to a client - and the state didn't even bother to investigate. For that matter, local Realtor associations are often complicit as well - mostly out of laziness rather than deliberate ill-intent. My best advise is to treat a real estate agent the same way you might your accountant / lawyer / financial planner / private banker: don't just pick one off Zillow or at random, but carefully cultivate a relationship before you need their services and take steps to discern for yourself whether they are acting as a fiduciary. I agree completely - there are a lot of bad actors in this space, but over the next decade I expect market forces to drive a lot of people out of the business and improve the professional standard.
  - gnicholas 3y ago
    What is it you anticipate happening that will trigger the change you describe in coming years? We were grossed out by our agent a decade ago, and when we went with a different agent (who came highly recommended by a neighbor whose house she sold) in a more recent transaction we were met with even more dishonesty than before.
    - 3y ago
WirelessGigabit 3y ago
> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics. How is this possible when looking at 2 houses, one $700,000 and one $850,000. The realtor makes more money on the latter. How is that not a breach of fiduciary duty?
- evancox100 3y ago
  People focus on this but the far bigger lever is simply time. If it takes 2/3 the effort to get you into the $700k home then the agent comes out ahead on a revenue/hour basis, and can move on to the next customer. (And the much bigger conflict is for properties with a no or reduced buyer’s agent commission.)
  - poulsbohemian 3y ago
    >(And the much bigger conflict is for properties with a no or reduced buyer’s agent commission.) I work in two states, one of which now has a mixed commission model and the other soon going there... we aren't seeing a lot of properties without a buyer's agent commission, but in those cases (mostly FSBOs) I've simply negotiated a reasonable fee to represent the buyer and we've baked it into the cost of their financing. They get representation but don't have to come up with more out-of-pocket. I would encourage people to ask their agents about commissions and have open conversation. I have a closing tomorrow and another next week and I couldn't even tell you the commission amount other than that yes I'll get paid something. If an agent is paying excessive attention to the commission or trying to strong-arm you into a house, find a different agent. Real estate is seldom about traditional sales - I don't sell you the property, I match-make you to it, IE: I'm here to find you the right property for you, and if I do a good job on your behalf the money will come. Again - if that's not the experience you are having, go find a different agent.
    - evancox100 3y ago
      I respect that there are many people doing their best to help their clients, without regards to the short run impact to their pocket book. (Obviously there is a long run benefit to keeping clients happy, etc, etc.) It is not hard to find examples online of buyers agents being told to ignore sub-3% listings, and the universal advice for people doing FSBO or flat fee listings is to still offer 3% tot he buyer. I think it would be better if the system didn't have this conflict of interest in the first place. It sounds like your market is there already, I expect the rest of the country to eventually follow even if they have to be dragged kicking and screaming. (See Moerhl, Sitzer/Burnett) On the positive side for agents, currently the best and worst buyer's agents are forced to charge essentially the same price. Breaking up the current model would in theory allow some differentiation. The best agents can offer more services that buyer's may want. Experienced buyers who need less help can go to an agent who charges less, etc.
TeeWEE 3y ago
[flagged]
mschuster91 3y ago
> He’s on postcards sent to people that public records indicate have recently divorced or had a death in the family. Why the fuck is this kind of "ambulance chasing" allowed in the first place?!
BrandoElFollito 3y ago
In France you cannot buy a house without a notary, and the whole thing is completely standardized. No surprise contract, or small print. The notary has a monopoly and charges for it a lot (the amount is regulated as well) but at least you have no legal worries.
- mixdup 3y ago
  A notary in France must mean something completely different from a notary in the United States. In the US a notary simply is verifying the identity, and swearing they have done so, of the people signing the document. It's entirely possible and happens all the time that a fraudulent document is notarized.
  - BrandoElFollito 3y ago
    In France (civil law, different from US common law) a notary is a qualified lawyer whose role when selling the house is to ensure that all the legal aspects are handled correctly (including things as making sure that the technical reviews of the house have been done, that there are specific documents from the city etc.), and to make sure that the people who sign the documents are the ones that are allowed to do so. This means that when you are done with the signature, all legal aspects of the transactions are covered. Since what needs to be checked is completely standardized and what is in the contract is standardized as well, you are not expected to negotiate anything (except for the price). There are no surprises in the contract either - it is all standard (and boring). When you are at the notary the contract is read out loud but for one you do not understand everything, and for two you do not worry either as this is the same thing everytime and cannot be neither less nor more than what is required by law. BTW, each party can have their own notary (what each of them do is legally defined as well and they share the fee (also according to the law :)) or you can have the same for both. It is very comforting for a stressful act like this. This is very similar with labour contracts (no notary involved, but a fixed set of points in the contract, no more an no less)
    - mixdup 3y ago
      >In France (civil law, different from US common law) a notary is a qualified lawyer whose role when selling the house is to ensure that all the legal aspects are handled correctly (including things as making sure that the technical reviews of the house have been done, that there are specific documents from the city etc.), and to make sure that the people who sign the documents are the ones that are allowed to do so. This is typical in the US, too (just called a lawyer, not a notary) but it's not required If you're buying a house with a mortgage, you're going to be represented by a lawyer who makes sure everything is on the up and up (and more importantly the mortgage company is being represented to make sure everything is on the up and up) But, it's not required and really all that's required to transfer property is a signature on a deed
Dah00n 3y ago
Reading what a mess real estate is in the US I'm now very happy with buying here in Scandinavia. I for some reason keep getting amazed at the many areas people are allowed to be screwed over while there is also the crazy litigations going on for even seemingly tiny things. So confusing.
DueDilligence 3y ago
[dead]
dctoedt 3y ago
This has gone into my "SPP" file (Shit People Pull).

234 points by ilamont 3y ago

abvaw 3y ago

[flagged]

paulryanrogers 3y ago
If there's enough fine print to require 3+ hours of reading for someone with high-schools level comprehension... then it can easily hide exploitive terms. For seniors with dwindling mental capacity the situation is even more dire.
- abvaw 3y ago
  If you haven't understood (or even read) what they are telling you to sign you shouldn't sign. What you can't do is sign and then complain about what you signed. That's ridiculous, and the courts agree.
  - paulryanrogers 3y ago
    Many of these people have dementia. It's not a fair negotiation.
    - abvaw 3y ago
      Contracts signed by mentally incompetent people are generally invalid. So this article isn't about that. Therefore, when the article says the courts accept the contracts as valid they can't be talking about the contracts signed by the infirm, but the article conflates both things maliciously.
      - jjulius 3y ago
        I would suggest that you read the ProPublica article that is the source of the claim, which details a years-long legal battle that then ensued, before you continue. It's not as cut and dry as you would like it to be. The following is literally about a "contract signed by the infirm": >After David learned of the contract, he explained to Evans that his mother had dementia and tried to cancel the sale. Instead of walking away, Evans dug in, recording a notice on the property’s title that essentially prevented a sale to anyone else, which forced the Casanova family into a years-long battle to keep the home. Along the way, Evans disputed that Casanova showed signs of impairment during their interactions.
        ttyprintk 3y ago
        Convenient link to the original: https://news.ycombinator.com/item?id=35901056 https://news.ycombinator.com/item?id=35901056
        wilg 3y ago
        Not disputing this is fucked up shit, but it's unfortunate there's not a super clear explanation of where the legal system is failing here. In general, it seems like a huge problem that people who probably are not capable of signing contracts can in fact sign them and have no real recourse for dealing with it. Seems like a good spot for a safety net.
        Arainach 3y ago
        There is a very long history of courts having people declared mentally incompetent to enable all sorts of abuse. Being cautious in cases like this is entirely reasonable, even when it's painful.
        wilg 3y ago
        Sure, but I'm wondering if we can come up with a way to solve this problem.
        wahern 3y ago
        Which part did abvaw not understand?
      - koolba 3y ago
        These scams prey upon seniors who are legally able to enter contracts but do not have the mental state to know what they are doing. Many of them are too scared or embarrassed to get help afterward as they fear they’ll be a bother or have what’s left taken away. The lesson here is to marry someone much younger so you have someone to take care of you in your twilight years. Also good to have lots of kids and raise them right. Statistically at least one of them will be able to take care of you.
      - neurobama 3y ago
        The buyers do not approach those who have been legally deemed incompetent. As you say, such a sale would not be valid. But then again, can the isolated mentally incompetent even bring such cases to court? Vulnerable people who break a hip and can't afford surgery also don't deserve to lose their homes, especially not at a fraction of market value. There are clear gaps in the system which these buyers are exploiting and which you are repeatedly and willfully excusing. There's a chapter in the Bible about this type of behavior involving whips, overturned tables and an angry Jesus.
      - MikeTheGreat 3y ago
        That's what makes this so brilliant, isn't it? The buyer has the signature on paper and can proceed with taking the house. The person who just sold their house _could_ contest it in court... except that they're not mentally competent so by definition they won't be able to mount a defense (i.e., realize that they just got scammed, hire a lawyer, put together a strategy, etc, etc). Brilliant! If the elderly, mentally incompetent person has _someone_else_ in their life who notices this early and jumps in to clock a lot of hours to stop this from happening, then sure - everything will be fine. If not, well, the bad guys win.
      - cratermoon 3y ago
        How anyone these days can have any faith in the legal system and not see the ways the courts favor money over justice is beyond me.
      - HEmanZ 3y ago
        The linked examples literally contain cases where the signer had diagnosed dementia or was tricked in an extremely dubious way (e.g “oh this is the exact same contract as last time just sign it”). And the contracts were upheld. Idk if it warrants a story beyond “existing laws not being upheld in some cases”, meaning I don’t know how much these cases apply to the whole market or most courts, but it looks like there are a fair number of seriously messed up contract scams getting through in this industry.
      - colanderman 3y ago
        > Contracts signed by mentally incompetent people are generally invalid. Yes, that's why the houses are considered stolen.
      - deleted 3y ago
        [deleted]
  - deleted 3y ago
    [deleted]
  - josephg 3y ago
    I'm pleased to report that the courts don't agree here in Australia. I was taught this story at university - apologies in advance if I've butchered some of the details. As I remember it, there was a famous case decades ago where a bank manager visited the home of an elderly Polish couple. The couple had a mortgage with the bank, and the bank wanted to renegotiate the terms of their mortgage. Only the wife was home, and she barely spoke any English. She understood that the man in the suit from the bank wanted them to sign some paperwork, so she did. As a co-signatory of the mortgage, her signature was enough. The couple eventually lost their home as a result, and the case went through the courts. Eventually the high court (equivalent of the supreme court in the USA) sided with the couple. They said that because the bank has more money and skill, they have more power in a negotiation like this. As a result, they bear proportionately more responsibility during contract negotiations. In this case, it was their responsibility as the powerful party to make sure the borrowers actually understood the terms they were signing. We basically only have 6 banks in Australia because of things like this. Its very difficult and expensive to open a new bank in australia because of regulatory requirements. But my impression is that the banks here are extremely careful when it comes to interacting with unsophisticated investors. They (reasonably) assume the courts will rule against them if they do anything that doesn't pass the pub test. (I am not a lawyer, this is not legal advice, etc.)
deleted 3y ago
[deleted]
ftxbro 3y ago
> "Propublica reveals homeowners with advanced dementia who signed their shaky signatures to transfer their homes for a fraction of their market value. They show how Homevestor targets neighborhoods struck by hurricanes, or whose owners are recently divorced, or sick. One whistleblower tells of how the company uses the surveillance advertising industry to locate elderly people who've broken a hip: "a 60-day countdown to death — and, possibly, a deal."" Indeed, they entered into the contract of their own volition.
- schainks 3y ago
  There is a nuclear waste disposal site next to aboriginal villages on Orchid Island off the coast of Taiwan because someone handed a contract to a Chinese-illiterate person and said, "sign this and we will build a cannery and help your local economy, trust us." What do you call volition without symmetrical information? What happens when other people's livelihoods rely on your volition? Should vulnerable people deserve additional protections? Your comment suggests that _anyone_ has volition enough to decide whether to sign these contracts or not, and I don't see how that's the case here.
  - AndrewKemendo 3y ago
    In fact the op doesn’t even go as far as to discriminate on context! So no matter what, if you signed on the dotted line, you’re liable case closed.
  - MichaelZuo 3y ago
    No contract has ever been signed with perfectly symmetrical information. So if that's the standard then no human being has ever had volition. If you mean there's some maximum acceptable threshold of asymmetrical information then the obvious rejoinder is who gets to decide what that threshold is? (And, philosophically, how is that decided when any possible deciders, or combination of deciders, are themselves asymmetrically informed?)
    - deleted 3y ago
      [deleted]
woodruffw 3y ago
The article linked in the post contains several separate stories, including ones where the victim was seemingly given a separate contract to sign than the one they had originally read (or was told, under pressure, that a contract was different from what it actually contained). The law has a concept for that: deed or title theft. "Stealing" is the appropriate colloquial descriptor.
hanoz 3y ago
Isn't that exactly how the the greatest acts of stealing are performed?
- ftxbro 3y ago
  Umm no, it's how capitalism works as protected under the rule of law in civilized societies.
asdajksah2123 3y ago
They're talking about buying houses from people who are suffering, bombarding them with advertising, and finally people who lack the mental capacity to know what they signed (the provided example in the blog, but there are far more in the original propublica article, is an elderly man who was incapable of writing their own name or naming the month of the year). But even setting that aside, I'm sure you're also absolutely fine with every "Terms and Conditions" you sign up to every time you create a free account online. So if as parodied in the South Park episode, Apple shows up to your house and insists you join their Human Centipad because it was right there in the terms and conditions you signed up to when buying an iPhone, you will happily have your mouth sown to someone else's backside because you agreed to a contract.
AndrewKemendo 3y ago
Is this the most empathetic response you could think of?
bdw5204 3y ago
A "contract" where one party is clearly not of "sound mind" is supposed to be null and void according to basic principles of contract law[0]. Tricking an elderly person with dementia or a mentally handicapped person into selling their house for half of its fair market value is reasonably characterized as "theft" or "attempted theft". The fact that a company is able to get away with stealing homes from elderly people who have dementia without these contracts being quickly voided as obviously fraudulent is all the evidence you need that the legal system is currently badly broken. These are not hard cases for a judge or a juror to consider. [0]: https://www.law.cornell.edu/wex/sound_mind_and_memory https://www.law.cornell.edu/wex/sound_mind_and_memory
jjulius 3y ago
Flippantly commenting about something without bothering to read what's being discussed is such a weird way to comment.
colanderman 3y ago
> "In August 2020, Evans pleaded guilty to two felony counts of attempted grand theft of real property." It's literally stealing.
seattle_spring 3y ago
Interesting that you felt the need to hide behind an alt to express this view.
lisasays 3y ago
It's called predatory acquisition. And it's specifically designed to look "fair" and hence more palatable to the overly credulous.
orangepurple 3y ago
The revolutionary film Soy Cuba also features this completely bogus line of thinking. The farmer sells over his land because he's broke then goes insane when he's evicted by the "mean capitalist" to whom he sold the farm. Somehow this forms the basis for the revolutionary spirit. People completely miss this. They just see evil capitalists under every stone.
- AlexCornila 3y ago
  they see evil capitalists under every stone because under a amoral economic system and a high enough number of “capitalists” resorting to mischievous ways to turn a buck that’s a precautionary principle
grayhatter 3y ago
Your needlessly ridged, hyper literal view of the world is going to be problematic eventually. (lol ask me how I know. ) Making an unfair offer to someone, after lying and/or gaslighting them when they're desperate or vulnerable, and THEN working incredibly hard to prevent them from undoing or recovering from a mistake. Might not meet your strict definition of stealing (still possibly fraud which would count as theft), it's clearly deep into the ethics of stealing. Which is the authors point. The thesis isn't a legal one "these people have committed the crime of theft". It's an ethical one, what these people are doing is equivalent to stealing; and a just society would prevent them from getting away with this asshattery.
- wilg 3y ago
  I'd hope that it is a legal thesis, because it doesn't seem like current law would allow this. The problem may be more in implementation details.
AlexCornila 3y ago
much of the claim for “freedom” rests on the ability to trick others into situations of consent that usually don’t benefit the consenting party.
Gigachad 3y ago
To some people; coming to a shared agreement and transferring money: stealing Shoplifting: not stealing.

tedunangst 3y ago

[flagged]

deleted 3y ago
[deleted]
bequanna 3y ago
What we need is ab unbiased third party to attest to the mental soundness of someone who agrees to sell their home far below market value.
- wilg 3y ago
  Or something similar to public defenders for civil cases or something?
  - bequanna 3y ago
    Or hold notaries to a higher standard?
    - wilg 3y ago
      Did any of this have to be notarized I wonder?

tmm84 3y ago

I wish more older Americans understood how these people really work. My parents live in a neighborhood that has gone down hill through the years. They called up a company who did this kind of home buying. Usual visual inspections and the like went on with a quote being issued. They saw the amount was a little over the remaining mortgage which was less than the market value of the house. They decided to ahead of time wire over $20k in cash from their bank to the mortgage company then move on with the sale. The home buyer company had been notified of the mortgage payment and immediately reissued their quote minus the exact amount transferred to the mortgage company. I wish my parents had told me their plan because businesses communicate more than they used to.

ttyprintk 3y ago
Now and then, someone posts on HN their saga about disrupting real estate. It’s difficult, but I wonder what would help those like your parents. I wonder what it would take for eBay to auction real estate, and whether older people in 2030 would try that instead of this caveman.
- mjh2539 3y ago
  Real estate is such a highly regulated industry with so many myriad laws governing it that you might as well ask what it would take for eBay to auction human organs.
poulsbohemian 3y ago
>I wish more older Americans understood how these people really work. I wish more Americans overall understood how real estate works. I see people get screwed all the time because of bad information. Here's an example: several times a year I will talk with a member of the public who will say something like "we want to work with the listing agent because then we won't have to pay as much commission" not understanding that in fact they are (assuming a traditional two sided commission offered by the seller) actually just giving that listing agent both sides of the deal. Or, similarly, they will say things like "we want to work with the listing agent because it's their listing so they will know the most about the property" again, not realizing that depending on your state, the rules for dual agency may not give you as a buyer the same representation as getting your own separate buyer's agent. In fact in some states, you may not actually be getting any representation at all, IE: they fill out the paperwork on your behalf but actually represent the seller. Those are just some trivial examples, but it's dumbfounding how many bad ideas the public has about real estate. So much of my job is hours of educating my clients apart from anything related to the actual transaction.

_8j50 3y ago

The author would prefer to verbally support "vulnerable people" instead of cash for their homes. I wonder what he thinks of foreclosures.

strix_varius 3y ago
I hate to respond to arguments made in bad faith, but this is so ignorant that I simply have to. If you read the article, and the excellent primary reporting it links to, you'll see that these companies are swindling people for significantly less than they would get from the open market. These people could hire a realtor and retain 95% of the value of their home. However, scams like "We buy ugly houses" blanket areas in advertisements so these folks never even get to find their market value - instead, selling for 50% or less of it. They're intentionally targeting folks who are least-likely or least-capable of protecting themselves with due diligence. I've witnessed this myself. An elderly man under full-time care, in another state, inherited a property in my neighborhood. A "franchisee" of one of these places got him to sign over the "right to buy" for a fraction of what it would have sold for in a single day on zillow or similar. I was interested in buying it, but I didn't want to end up owning something that way, so I reached out to the man directly to link him to the (much higher) estimated value. I never received a response from him: just from a "caretaker" who, I imagine, was being enriched somehow by the deal. I doubt the actual owner was ever informed. It's incredibly predatory and there's a whole industry of "how to" get into it (it being "wholesaling," or unregulated real estate brokerage): https://www.fortunebuilders.com/absentee-owner-lists/ https://www.fortunebuilders.com/absentee-owner-lists/
- pessimizer 3y ago
  There's a libertarian idealization of predatory behavior. Apparently, when we don't restrain predators they get better and better, and more and more people become predators, and that's how we build civilization. Also those who don't become predators are getting what they deserve.
  - _8j50 3y ago
    I am not a libertarian FYI. The question is not whether predatory businesses are good or bad, the question is, so long as their advertising is not deceptive, who do you or the government think you are to take options away from people and profits from business owners? Everything from junkfoods to lotteries are "predatory" because poor people who can do better choose them by this logic. I am simply challenging you to educate people or invent a competition that is better and can advertise better. What you call predatory is a fair business practice given the responsibility of spending your money after being well informed is the consumer's responsibility while the business simply needs to not deceive or coerce consumers.

morkalork 3y ago

>One whistleblower tells of how the company uses the surveillance advertising industry to locate elderly people who've broken a hip: "a 60-day countdown to death — and, possibly, a deal." This statement right here is truly disgusting and real. It doesn't just apply exploitive contracts either. In the case where the victim is deemed incompetent by the government, this is how families have them die. You want to talk about socialist death panels? Family members with power of attorney will turn down surgery knowing full well its not only a death sentence, it's excruciatingly painful the whole time. People show more mercy to their pets.

neilv 3y ago
This is just barely scratching the surface of the surveillance society that our own tech industry has enthusiastically embraced, at every opportunity. Even from the very first alpha prototype or placeholder Web site we create, we almost always throw in third-party "analytics". Haven't even launched MVP, and already selling out out the privacy of our visitors.
toast0 3y ago
Surgery for a broken hip in an elderly patient may not do much to aid survival, depending on the patient's situation. Managing pain may be more humane than a surgery; especially if the patient is not of sound mind and may be unable to participate in rehabilitation to make use of their repaired or replaced hip. Of course, you're not allowed to request euthenasia for your relatives like you are for your pets, so it's harder to show the same type of mercy.

andrewstuart 3y ago

>> Home ownership is the American dream: In Australia, for many people the (new) Australian dream is: "One day I hope to have the income to be able to afford to pass the grueling real estate agent's suitability test to rent a house and move out of the tent/car."

labster 3y ago
[flagged]
- andrewstuart 3y ago
  Mass homelessness is new to Australia. It's used to be a small number of people here and there. The obsession with owning real estate has turned our society into landlords and renters, with renters paying the mortgages on their landlords investments - mortgages which are spiraling up due to interest rate rises. Nearly all the members of parliament have extensive housing portfolios so they have disincentive to fix it. In fact recently house prices were going down, so the ALP government just fast tracked in 715,000 migrants, which has fixed that problem nicely. Australia was already in the worst housing crisis ever in its history. When asked how the 715,000 migrants will impact the housing crisis, the ALP government simply says that migration does not impact housing, and that the housing crisis is not the fault of migrants. Previously even the slightest questioning of migration risked you being labelled a racist, but with the new government fast tracking 715,000 and planning for 1.5 million migrants in the next five years, it's has become a huge community issue and many are standing up and asking why we are importing vast numbers of people when the country does not have the housing or resources to support them. The people at the bottom of society - who don't look great on a rental application form - what are they doing? I don't know what happens to them. It's awful and the ALP government really don't care. I've come to deeply hate government in general. The ALP is meant to be the left wing party that looks after ordinary people. Instead it has turned out to be just another bunch of rich politicians feathering their own nests.
  - stephen_g 3y ago
    Yes, which is why more people need to vote minor parties and independents if there are good ones in their electorates. Basically our major parties are a bit like the US - the Liberal/National coalition, like the Republicans, govern for the rich at the expense of the poor, and the Labor party (like the Democrats) just maintain the status quo but put a progressive PR spin on it... The political ratchet, where one party moves things, and the other just stops things moving back... At least our voting system actually lets minor parties win seats, which is why I think our Government is at least a bit less crazy than the States.

bmarquez 3y ago

I've seen those signs before. They were posted in rapidly gentrifying Hispanic areas, probably targeting those with weak English or financial literacy. The interesting things is that the signs appeared to be handwritten with a black marker but all of them looked exactly the same. There were commercially produced but they took the effort to hide it.

seattle_spring 3y ago
The jankiness is intentional. Apparently it helps weed out people that'd catch on to the scam. Someone dumb or desperate enough to call a hand-written sign is more likely to follow through to the end without getting suspicious. It's the same reason lots of spam and email scams are full of typos and bad grammar.

chasil 3y ago

deleted 3y ago
[deleted]
kennethrc 3y ago
You need to fix your keyboard, your current one is dropping "0"s (... kidding, but where is this?!)
- sgerenser 3y ago
  Almost anywhere in the rust belt has houses like this (well under $100k, at least back in the early 2000s). Typically they’re in rough areas of town and it’s difficult to rent them to anyone but section 8 tenants (government program that covers much or all of the rent for low income tenants).
- chasil 3y ago
  The home in question is very near Augustana College in Rock Island, Illinois. I do a two mile walk through campus every day, schedule permitting. I did not drop any zeros. Salary.com rated this as one of the least expensive places to live in the U.S. a few times. I drive over the Mississippi twice a day, to and from work. We have the second largest airport in Illinois, but lost our budget airline (Airtran), so I use O'Hare or Midway now.
switchbak 3y ago
60k? Shoot, that wouldn't buy an outhouse out here in BC.

iosystem 3y ago

Reminds me of recently reading an opinion about how thrifting has been ruined by the upper middle class. The person expressed how thrifting is a necessary need when growing up poor and how the trend of thrifting in popularity among middle class has reduced the quantity of quality items to basically none. Quality of life I believe is getting worse for a lot of people regardless of how long we can force people to stay alive with medical means.

dclowd9901 3y ago
If anything, thrifting is about the most democratized activity there is. The bad that I see in thrifting is resellers who dedicate their whole life to combing thrift stores, estate sales and garage sales, finding items with a lot of resale value so they can hock them on EBay or in their own boutiques.
mock-possum 3y ago
Sounds like they were confusing a business for a charity. There are exceptions, but most thrift shops are the former.

labster 3y ago

Some discussion on the same topic which mods will hopefully merge into this post: https://news.ycombinator.com/item?id=35910310 https://news.ycombinator.com/item?id=35910310

dang 3y ago
Merged hither. Thanks!

bhouston 3y ago

They are a discount buyer, so it is generally a bad deal to use them and you basically shouldn't unless you have no other option. It is similar to getting a pay day loan, or selling stuff to pawn shop or keeping a balance on your VISA. You are going to get a bad deal. I don't really know what to do about it. How can you ensure people are educated enough to know that a discount buyer is a buyer who will under pay for your house? I guess you legislate away discount buyers completely? In Canada, they have regulated severely the amount of interest pay day loan companies can charge. This has led to a shrinkage in the number of pay day loan companies. So I guess some similar type of consumer protection laws could be enacted in this space.

nekitamo 3y ago
Legislating away discount buyers would be like legislating away payday lenders. The only thing accomplished would be to leave a hole in the market which will be filled by shady loan sharks.
- deleted 3y ago
  [deleted]
- refurb 3y ago
  Not sure why you’re downvoted because it’s true. People desperate enough to use payday lenders have no other options. And the high interest rates reflect the risk. Take that option away and the need doesn’t magically disappear, they just go to black market lenders where there really is no backstop at all. Far better to regulate.
  - Nursie 3y ago
    > People desperate enough to use payday lenders have no other options. Not always true, some folks misuse them for a variety of reasons. Take the option away in the UK and a friend’s boyfriend wouldn’t have been able to use an app to take out a bunch of short term loans in her name for Xbox games… So I think sometimes these facilities are used frivolously. You’re right that a portion of users in real hardship would turn to “informal” lending if these lenders were to disappear. But it feels like we as a society should come up with a better solution there really.

Nursie 3y ago

When I was leaving the UK a couple of years back, I was tempted by some of the marketing blurb from some similar organisations there. We had a house to sell, and were hoping to get it wrapped up before leaving, so "we buy all houses, we can close the deal in a few weeks, great prices offered!" sounded interesting. But then you look up people's experiences and the shady practices start to show. They give slightly low-ball offers, but nothing outrageous, 5-10% under market to hook you in. Most people who use them have some sort of extra motivation to sell and these arseholes know it, so at the last minute* they drop their offer significantly, in the region of 20-30%, and try to really screw you. So we stayed well clear! (*and there are a lot of last minutes in UK house sales, in fact several last months sometimes... our eventual sales process took about 4 months from acceptance to completion, and either party can drop out with no penalty up to roughly the last two weeks. It's a terrible system) (The above does not apply to Scotland, who have sorted this out long ago!)

ClumsyPilot 3y ago
> at the last minute* they drop their offer significantly, in the region of 20-30%, and try to really screw you. I feel like doing this consistently as a tactic shoyld amount to fraud and misrepresentation

dmbche 3y ago

Exchanges of over some amount of money should be supervised by a third party just to check it's not a scam - how hard could it be? I can't believe there are no safeguards for people...I can't believe it wouldn't be worth it socially

danielmarkbruce 3y ago
Often two people want to do a transaction without anyone else knowing about it. The US is, to a large extent, built on the idea the idea of individual freedom etc etc.
- granshaw 3y ago
  Home sale transactions end up being public record anyway tho
  - danielmarkbruce 3y ago
    Yup, and practically speaking the IRS ends up knowing about virtually every meaningful transaction too. But, the people get to do the thing without anyone knowing they are going to do it, or stopping them doing it, or in most cases many of the details.
55555 3y ago
Okay now define scam.
- dabluecaboose 3y ago
  Yup. I can easily imagine some third-party scam police cracking down on things like "I sold my son the family home for $1" or other similar unusual (but not scam) transactions
  - mschuster91 3y ago
    An independent party (like in Germany, a notary) can at least flag suspicious activity and demand explanation or verify if the parties are authorized to act and of sound mind.

devmor 3y ago

I feel like this is just a foreseeable consequence of any for-profit organization that operates on "getting people out of a tight spot". If your motive is to make money, you are always going to have the incentive to take advantage of the imbalance of power created by said tight spot.

chii 3y ago
but is the person who needs to get out of said tight spot be worse off had no such for-profit organizations been around?

chasil 3y ago

I bought a local house in 2004 that suffered a failed furnace in deep winter (with great damage) for $17k. I put another $10k into it for repairs, and rented it. I started getting postcards around 2012: "I/we want to buy your house." I have a pile of them. None of them offered more than $20k. The home in question is very near Augustana College in Rock Island, Illinois. I do a two mile walk through campus every day, schedule permitting. The house was lost by previous owners who engaged two mortgages on the property to fund their gambling. I had pandemic tenant problems; they didn't pay during the last six months, and the damage was substantial. I repaired the damage, then sold it on contract for $60k; I'm done with rental property. I'm still getting calls and postcards. p.s. I drove by a house, very similar to mine, but with substantial roof damage, that was for sale for many months for $15k. It dropped to $5k near the end of the summer. I walk by it, going downtown, and the current owners seem to have repaired the damage, and are on their porch from time to time.

supportengineer 3y ago
Why are those homes so cheap?
- PraetorianGourd 3y ago
  A mixture of: 1. The home being in a state of disrepair such that most lenders won’t fund a mortgage 2. Being located in a region where the local economy can’t support high home prices 3. Because of the lack of desirability, a lack of speculative investment.
  - chasil 3y ago
    ...and now that workers are remote and can live wherever they want, these are fair game. After driving through Port Lavaca, TX, that seems really nice. If you like snow, you will be happy with Rock Island.
    - fuzzfactor 3y ago
      If you like fishing you will be happy with Port Lavaca.

1letterunixname 3y ago

There's another legitimized scam involving foreclosures, pre-foreclosures, and outright theft: adverse possession where a 3rd-party pay some back taxes and gets the property for a song. In some municipalities, adverse possession can be used without paying back taxes to squat and legally transfer a portion of another title to a person occupying that area.

gnicholas 3y ago

> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics. Our experience with real estate agents has been far from this ideal. We had to fire one after she lied to a counterparty and then lied to us in an attempt to cover it up. Other agents weren't much better, and none of them seemed to take their fiduciary responsibility seriously. They seemed to be looking out for themselves 100% of the time, and their client only when interests were aligned. The relationship epitomizes the principle-agent problem.

poulsbohemian 3y ago
Real estate agent here...While there are many agents that hold themselves to the standard that the National Association of Realtors has documented in their code, one of the root problems is that state agencies are negligent in enforcing rules and investigating fraud. For example, I know a fellow agent who had documented proof of another agent committing a fraud that did approx $400K in damage to a client - and the state didn't even bother to investigate. For that matter, local Realtor associations are often complicit as well - mostly out of laziness rather than deliberate ill-intent. My best advise is to treat a real estate agent the same way you might your accountant / lawyer / financial planner / private banker: don't just pick one off Zillow or at random, but carefully cultivate a relationship before you need their services and take steps to discern for yourself whether they are acting as a fiduciary. I agree completely - there are a lot of bad actors in this space, but over the next decade I expect market forces to drive a lot of people out of the business and improve the professional standard.
- gnicholas 3y ago
  What is it you anticipate happening that will trigger the change you describe in coming years? We were grossed out by our agent a decade ago, and when we went with a different agent (who came highly recommended by a neighbor whose house she sold) in a more recent transaction we were met with even more dishonesty than before.
  - 3y ago

WirelessGigabit 3y ago

> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics. How is this possible when looking at 2 houses, one $700,000 and one $850,000. The realtor makes more money on the latter. How is that not a breach of fiduciary duty?

evancox100 3y ago
People focus on this but the far bigger lever is simply time. If it takes 2/3 the effort to get you into the $700k home then the agent comes out ahead on a revenue/hour basis, and can move on to the next customer. (And the much bigger conflict is for properties with a no or reduced buyer’s agent commission.)
- poulsbohemian 3y ago
  >(And the much bigger conflict is for properties with a no or reduced buyer’s agent commission.) I work in two states, one of which now has a mixed commission model and the other soon going there... we aren't seeing a lot of properties without a buyer's agent commission, but in those cases (mostly FSBOs) I've simply negotiated a reasonable fee to represent the buyer and we've baked it into the cost of their financing. They get representation but don't have to come up with more out-of-pocket. I would encourage people to ask their agents about commissions and have open conversation. I have a closing tomorrow and another next week and I couldn't even tell you the commission amount other than that yes I'll get paid something. If an agent is paying excessive attention to the commission or trying to strong-arm you into a house, find a different agent. Real estate is seldom about traditional sales - I don't sell you the property, I match-make you to it, IE: I'm here to find you the right property for you, and if I do a good job on your behalf the money will come. Again - if that's not the experience you are having, go find a different agent.
  - evancox100 3y ago
    I respect that there are many people doing their best to help their clients, without regards to the short run impact to their pocket book. (Obviously there is a long run benefit to keeping clients happy, etc, etc.) It is not hard to find examples online of buyers agents being told to ignore sub-3% listings, and the universal advice for people doing FSBO or flat fee listings is to still offer 3% tot he buyer. I think it would be better if the system didn't have this conflict of interest in the first place. It sounds like your market is there already, I expect the rest of the country to eventually follow even if they have to be dragged kicking and screaming. (See Moerhl, Sitzer/Burnett) On the positive side for agents, currently the best and worst buyer's agents are forced to charge essentially the same price. Breaking up the current model would in theory allow some differentiation. The best agents can offer more services that buyer's may want. Experienced buyers who need less help can go to an agent who charges less, etc.

TeeWEE 3y ago

[flagged]

mschuster91 3y ago

> He’s on postcards sent to people that public records indicate have recently divorced or had a death in the family. Why the fuck is this kind of "ambulance chasing" allowed in the first place?!

BrandoElFollito 3y ago

In France you cannot buy a house without a notary, and the whole thing is completely standardized. No surprise contract, or small print. The notary has a monopoly and charges for it a lot (the amount is regulated as well) but at least you have no legal worries.

mixdup 3y ago
A notary in France must mean something completely different from a notary in the United States. In the US a notary simply is verifying the identity, and swearing they have done so, of the people signing the document. It's entirely possible and happens all the time that a fraudulent document is notarized.
- BrandoElFollito 3y ago
  In France (civil law, different from US common law) a notary is a qualified lawyer whose role when selling the house is to ensure that all the legal aspects are handled correctly (including things as making sure that the technical reviews of the house have been done, that there are specific documents from the city etc.), and to make sure that the people who sign the documents are the ones that are allowed to do so. This means that when you are done with the signature, all legal aspects of the transactions are covered. Since what needs to be checked is completely standardized and what is in the contract is standardized as well, you are not expected to negotiate anything (except for the price). There are no surprises in the contract either - it is all standard (and boring). When you are at the notary the contract is read out loud but for one you do not understand everything, and for two you do not worry either as this is the same thing everytime and cannot be neither less nor more than what is required by law. BTW, each party can have their own notary (what each of them do is legally defined as well and they share the fee (also according to the law :)) or you can have the same for both. It is very comforting for a stressful act like this. This is very similar with labour contracts (no notary involved, but a fixed set of points in the contract, no more an no less)
  - mixdup 3y ago
    >In France (civil law, different from US common law) a notary is a qualified lawyer whose role when selling the house is to ensure that all the legal aspects are handled correctly (including things as making sure that the technical reviews of the house have been done, that there are specific documents from the city etc.), and to make sure that the people who sign the documents are the ones that are allowed to do so. This is typical in the US, too (just called a lawyer, not a notary) but it's not required If you're buying a house with a mortgage, you're going to be represented by a lawyer who makes sure everything is on the up and up (and more importantly the mortgage company is being represented to make sure everything is on the up and up) But, it's not required and really all that's required to transfer property is a signature on a deed

Dah00n 3y ago

Reading what a mess real estate is in the US I'm now very happy with buying here in Scandinavia. I for some reason keep getting amazed at the many areas people are allowed to be screwed over while there is also the crazy litigations going on for even seemingly tiny things. So confusing.

DueDilligence 3y ago

[dead]

dctoedt 3y ago

This has gone into my "SPP" file (Shit People Pull).