Nationstar I received several emails after my article last month regarding “Are Investors Flipping over the Gray Line.” The questions were about Land Trusts and transferring the beneficial interest at the time of closing. So … I am writing to all of those individuals who might be ‘Flipping Over the Gray Line’ but not really knowing it. Or maybe you are being coached by mentors and/or partners who are advising you that this is alright to do. If that is the case, then I want you to fully realize who will be liable for the wrong doing.

First off, the Short Sale Approval Letter and the Short Sale Arm’s Length Affidavit will advise you how you can conduct the closing regarding several factors: Closing Date, Approved Short Sale Amount, Approved Commission and Closing Costs, Approved Buyer Name, and any Deed Restrictions such as how long the new Buyer must hold the property before selling the property or if you are aware of any other agreements to sell this property to someone else at a higher price. All of Bank of America’s short sale letters and/or the Short Sale Arm’s Length Affidavit state that the Buyer cannot resell the property for 30 days. However, sometimes the Title Company, due to the wording in the Short Sale Approval Letter and/or the Short Sale Arm’s Length Affidavit, is not instructed to place this restriction directly on the Deed. This is where the Investor/Buyer thinks they have found a loop hole! The Investor/Buyer will close with Title Company A and then the same day or shortly after will turn around and close with Title Company B who has no knowledge of the Buyer’s requirement to hold the property because they did not do the first closing.

Many Investors/Buyers will close with their end Buyer first with Title Company B and use that money to fund the first transaction with Title Company A. This is where I am very concerned about the Investor and mostly the Seller, as the terms and conditions of the short sale have now been violated. This situation makes the Seller’s short sale void, should the Short Sale Lender ever do a look-back on the closing/sale dates of their approved short sale properties to make sure that the New Buyer/Investor has complied with the holding terms. And … guess what??? They DO have a department that does just that and I am asking you who, at that time, will take the heat by being sued by the bank? I believe they will go directly after the Investor/Buyer with the deep, deep pockets, as the Short Sale Lender believes, since the Investor/Buyer did sell the property for higher. This also causes them to take a harder look into ALL activity that the Investor/Buyer has done in the past; if they did it once and thought they got away with it, why not do it again. Here is a list of Plaintiffs that now have the right to file a lawsuit against the Investor/Buyer: Seller, Title Company A, Title Company B and the end Buyer which I call “C.”

Well, Investors are writing me saying, “I just close in a Land Trust and then transfer my beneficial interest at closing to my end Buyer “C” and therefore I haven’t violated any of their rules.” I am not an attorney; however, I did work with them for 18 years. Florida changed their statute to state that any property held in a Land Trust is considered “real property,” versus the wording in our Land Trust claiming that the property is “personal property.” As “real property,” transfer tax becomes due at the time the beneficiaries are changed. In addition, if you are doing a short sale using a Land Trust, they always want a copy of the Land Trust to make sure that the Seller isn’t the beneficiary. In order to get your short sale approved, you have to send them a copy of the Land Trust. If there was a transfer of beneficiaries without paying transfer taxes, then there was a violation of the terms and conditions of the Short Sale Approval Letter and/or Arm’s Length Affidavit. What makes me the authority on this? I previously taught how to properly use Land Trusts on Short Sales and no longer teach using Land Trusts on Short Sales due to the statutes changing.

I do teach you how to close transactions correctly, which may require holding the property. However, writing an Article to tell you exactly how to do it is not going to save you. One article cannot possibly cover the many errors that can occur for the Investor/Buyer. My Home Study System, which I personally use along with many successful Mentor Students, teaches the proper way to close when it comes to Deed Restrictions, and it isn’t always necessary to hold the property either. As a Mentor who is teaching and partnering with students in Florida, I just want to send a sincere word of warning out to everyone to be very careful on how you conduct yourself. We are all working as a team to rebuild our economy and it only takes one rotten egg (Investor) to spoil the rest of the deals for Investors who are complying and doing it right. Investors already have a bad name in the eyes of the Banks and Sellers; we don’t need any more heat or negative attention. Investors are the ones working hard and actually increasing the values in Florida.


I hope this Article opens the eyes of Investors who think that they have found a loophole and are not complying with the terms and conditions of a short sale. Please learn from someone highly experienced who knows what they are talking about. Also, for your own protection, do not just assume that when you partner with someone, they know all of the Florida statutes.


Keep investing and flipping those houses, however, be smart about it……”IN-DEED!!”


Happy Negotiating!

Kimberlee Frank

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Kimberlee Frank Broker Short Sale Expert


Kimberlee Frank Real Estate Broker and Teacher/MentorKimberlee Frank is known as “The Real Estate Junkie,” for her unique ability to find ways to creatively help buyers and sellers no matter which direction the real estate market is heading. Kimberlee had already worked as a legal administrator for an Attorney, Builder and Broker for 18 years when she began her Real Estate career in 1998. She dotted the i’s and crossed the t’s on hundreds of real estate transactions and thousands of documents, making her an expert in real estate documentation. Kimberlee’s success began in Fenton, Michigan. She specialized in selling, purchasing, renovating, retailing and lease optioning single-family homes. She has helped many sellers get rid of their “headaches” and helped many buyers find their dream homes!


Since 2003, she has specialized in foreclosures and short sales. After realizing how many families were being forced out of their homes due to financial difficulties, Kimberlee had a heartfelt obligation to use her experience to help those families. She has mitigated and closed over 500 short sales with the mortgage companies, saving Sellers from going into foreclosure. In 2006, Kimberlee and her family moved to Florida. She lives in Oviedo and her Sell Fast Realty Office is in Winter Springs, serving residential and commercial sellers and buyers in multiple counties in Central and Southern Florida.

Kimberlee is also a Trainer and Mentor and has created several different “How To” systems on real estate. Her unique strategies continue to educate real estate professionals across the country. If you have a proven system to help others out of hardship, why wouldn’t you duplicate it and share it with as many people as you can? Kimberlee continues to work with this philosophy!

Kimberlee Frank Author of Big Ideas for Your Business
Kimberlee Frank has been featured on ABC, NBC, FOX, CBS as well as Wall Street Journal, Newsweek, USA Today and numerous other publications. She is the bestselling author of “Big Ideas for Your Business” (Advantage Media 2009). She was also selected as the #1 Short Sale Expert by America’s Premiers Experts.

Please contact Kimberlee at her office at 407-888-3433 to schedule a Free Facts About Foreclosure Seminar. She has numerous testimonials from sellers, buyers and other real estate professionals who are familiar with her giving heart. Whether it is 1 person in need or 1,000…..Kimberlee will educate them on real estate and give them a solution with a peace of mind!

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Are you unsure what to do with your house? Do you need to educate yourself about your options. Click the following link Free Facts About Foreclosure for more information.


God Bless,

Kimberlee Frank


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