Lease/Options: Beware

by Osman Parvez

A couple of months ago, we attended an investor presentation by Colorado real estate attorney Oliver Frascona. It was one of the better real estate/law presentations we've seen and I came away with very high regards for Frascona.

Much of the talk dealt with lease/options and why they are a bad deal for owner-sellers in Colorado. In short, if the deal goes bad, Colorado courts will treat the situation like an equitable mortgage resulting in a very long foreclosure process. It will be much more difficult and time consuming than a simple tenant eviction and you probably won't be collecting much rent during this period.

Recently, a message came across the CAREI warning list about a lease/option scam currently underway. The email reminded me of Frascona's presentation, considering which, perhaps this investor got off lucky.

I thought I'd pass along the warning....

From: "Joe Gilligan"
Date: Fri, 07 Apr 2006 22:47:19 -0000
Subject: [CS_CAREI] Beware !!!
Hi all. Just wanted to shoot a quick message to the group in the form
of a warning. Just had some tenant/buyers thoroughly trash one of my
houses to the tune of about $10K in damages and skip out. They even
tore out the plumbing and took it with them! After talking to
their "friends", relatives and former neighbors I do have a strong
suspicion that they will be hunting up another lease/option deal here
in town from another investor - so WATCH OUT. These folks are among
the best con artists I have ever come across. They look pretty good
on paper - but they will steal everything that isn't nailed down (and
lots of stuff that is also!). Their names are TAD AND JILL WALTON. If
they come your way run away fast. Also, if you have had recent
dealings with them (shown them a house, taken an application, etc.) I
would be VERY interested in any information you could provide that
would help me track them down so I can serve them papers!

Thanks in advance for any possible help in this regard, and I hope
this saves a fellow investor some real grief.

Joe Gilligan

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