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Terry said:
I recently found that 2 of those properties that I had loans for with ANZ had a major problem. The titles were not in my name-18 months after being purchased. After many phone calls and complaints etc, I found out that ANZ had not transferred the titles.

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What did you mean Terry? The titles would always have been in your name regardless of whether there’s a mortgage on the properties. Isn’t it your settlement agent’s responsibility to deal with this?

Cheers
M

Hi Johnny,

I disagree with you on your definition of “agent”. At law, an agent has an obligation to act in the best interests of his or her principal (ie the seller). The agent does not have any legal obligation to look out for the buyer where it would be detrimental to the interests of the principal.

Of course, a professional and ethical agent would want to try to achieve a win-win situation for seller, buyer and agent.

That said, many agents appear to look after only themselves, and both seller and buyer get burnt.

Why do they get away with it? Because most of the people who deal with them are mums and dads and normal people like you and me, who don’t have the time, resources or inclination to pursue an agent through legal avenues (which is where it’ll hurt them the most – their hip pocket). Let’s face it – suing someone is expensive and emotionally draining. And it could drag on for years before you finally get your compensation. Most people would rather just count it a lesson learnt and walk away.

Cheers
M

I agree with Richo. The purpose of the forum is to share ideas, but you can’t simply log on and expect to find a step-by-step how to guide on investing in properties. Books several hundred pages long are written about that topic. It’s a bit simplistic to think that you could meaningfully condense all that into a handful of postings.

Regi – read up on some good property investment books. Some of my recommendations are: Rich Dad’s Guide to Property Investing (Dolf De Roos), 0-130 Properties in 3.5 years (Steve McKnight) and that Neil Jenman book (I think it’s called Don’t Sign Anything). They all give you different perspectives on property investment, from people who seem to be very successful property investors. I think the one key thing to remember is that there are many different ways to do well in property. It really depends on what you want – quick capital gain, gradual capital gain, positive cashflow, negative gearing (yes I know many people say this is bad), etc. And it also depends on your temperament and personality.

You need to go out there and do the research yourself, then work out which method is the “best and easiest way” for you. Spend a few hundred bucks of that $25,000 working out how to do it properly, rather than just relying on what someone tells you, and risking blowing the entire lot on the basis of bad or inadequate advice.

Cheers
M

P.S. Hey Richo – congratulations on becoming a moderator! Does that mean you have to do shifts with Sooshie and AD?

Hey Sooshie,

It looks like he may have to hire a bankruptcy expert (many medium and small accounting firms have such people, and other practice in their own outfits – look under insolvency practitioners in the Yellow Pages) and try to come to a formal arrangement with his creditors (the formal name varies between states). It’s not bankruptcy, so he saves face, but it is still recorded against his credit rating. The benefit is that it gives him some degree of protection against creditors who then cannot sue him for payment of the full amount owing up front, but have to accept payment by instalments. If his situation is really dire, they may even be forced to accept less than 100 cents in the dollar, because the alternative would be that they get substantially less.

Of course, it’s still a black mark against his credit rating, and he’ll find it hard to ever borrow money again, but maybe this is a good thing.

The other problem is him – if he refuses to accept that there’s a problem, he may refuse to accept any such help. However, businesses and companies go to these people all the time when they hit the wall, because getting out of the cr@p is better than going bust.

All the best.

Cheers
M

Good point Terry – in that case, if the bank asks you and you state “No”, when in fact the answer is “yes”, I still question whether a charge of fraud can be successfully brought, given that the bank has a copy of the contract which shows the existence of a rebate. However, it’s likely to be a breach of contract in any event, which may allow the bank to pull out of the loan (if settlement hasn’t happened yet) or to demand full repayment of the loan immediately.

Hang on there! People seem to be freely bandying around the “fraud” word. Do you really understand what that means? Fraud as I understand it is to gain a benefit by making false representations.

If, as Shelley described, the entire transaction, including the cash-back deal, was in the contract, how can you say it’s fraud? The contract is given to the bank, who is a sophisticated and professional business. Not the village idiot. I think that it is reasonable to proceed on the basis that the bank has notice of the arrangement once you give them the contract. I personally guarantee that any bank who tries to claim that they didn’t read a contract properly, and should therefore be excused from honouring the loan agreement, will be laughed out of court. By analogy, if you signed the bank’s loan agreement, do you even think that you’re going to get off the hook by saying you didn’t read something in the contract? I don’t think so.

I’m sure Stuart is right. Maybe it’s a slip-up by the bank. But since when are borrowers under a duty to help the bank read a contract? Why are you second-guessing the bank?

And I can’t see how any competent solicitor who is presented with a deal like Shelley’s would even spend more than a passing thought on whether or not it’s illegal, because there’s no question of illegality at all.

Cheers
M

Hey that’s great for you westan. It would be nice to have more of a supportive environment like you do. But we do what we have to do, despite what others say.

Hey I’ve been censored! And I wasn’t even using a rude word, although I can see how you could extract one from it. In the interests of protecting my good name, I was only trying to say: “s-w-a-n-k-y”, meaning “flashy”, or “high-class”.

I agree with Rod. It’s part of the cost of buying the property, like stamp duty and settlement fees.

Cheers
M

Good on you truska! It’s good to hear success stories.

Hang around some more and share your experiences.

Cheers
M