Utah payment

From CaseyPedia

On December 7, 2006, Casey Serin reported on IAFF that his Highland, Utah property, which had been "wrapped" and was no longer facing foreclosure, appeared to have come unwrapped:

I found out that Utah payments are two months behind! The buyers who wrapped it were supposed to be making payments to a 3rd party servicing bank which in turn would send out the payments to my lender. Looks like they only made one payment before defaulting. The payments are two months behind with $6142 in past due amount.^[1]

After a frantic round of phone calls, Serin reported on December 12 that he seemed to have located the source of the problem:

The buyer is paying on-time just like he should and the escrow company is servicing the payments like they should. Nobody dropped the ball here. (The buyer was a bit alarmed to hear from me. The problem -- after checking with Central Bank (the servicing company) I realized the payments are still being sent to First Magnus, my old lender. I then remembered the loans were sold to Aurora shortly before the property was wrapped. I was supposed to notify the servicing company. My bad.^[2]

All but one of the payments were eventually tracked down. That single payment has never been accounted for, to the satisfaction of the Haterz™. Serin has been repeatedly asked about the status of this still-missing payment, but to date has never resolved the matter, leading to speculation that he might have diverted those funds into his own pocket, or that he sees no benefit in spending any more time to track it down unless it threatens to unravel the entire deal.

On June 27, 2007, over six months after the missing payment fiasco began, LossMitPro posted on DHC:

Just to confirm, I’ve communicated much of what you’ve indicated to Casey who (predictably), ignores the issues in lieu of less pressing concerns. But his contention of a misapplication during escrow appears accurate, based on my examination of the HUD-1 relating to the wrap.

At line 502. some $37,290.15 was due from the buyers, with $6,133.15 of that sum payable to Aurora (at line 1304.) for delinquencies on the 1st & 2nd mortgages. Where the misapplication occurs appears to be by the date of closing, whereas the HUD-1 I examined had a final date of 9/12/06.

Mortgage payments serviced by Aurora are due on the first of each month, universally, with lates being attributed beyond the tenth day. What evidently happened is that Casey (in his infinite RE investing experience) did not account for a closing delay beyond the first of the month following demands, equating to a set of payments for both 1st & 2nd Aurora serviced mortgages (or one wrap payment respectively). Thus it is CASEY, not the property purchasers (Wrapees) whom should make up the single wrap payment (equating to one payment of the 1st & 2nd mortgages). The Wrapees (property purchasers) are not in default for this particular misapplication.

First American (escrow holder of the wrap sale) cannot be held responsible for E&Os occurring, as Casey (playing lender in this instance) bore the responsibility to verify demands before closing. Read the fine print on most First Am Title Policies and you’ll see where I’m coming from.

At long last, Fliptardian is in default of the wrap contract. Not the buyers (Wrapees) unless other payments have since come into default, but even then the catalyst breach occurred by Serin himself at sale consumation! Hence; Casey is responsible for the “missing” Utah payment (one, 1st & 2nd mortgage payment).^[3]

[edit] References

1. ↑ Utah House Unwrapped, IAFF Post.
2. ↑ Utah House Still Wrapped, IAFF Post.
3. ↑ Let's Wrap, DHC Post, June 27, 2007.