Copy for Real Estate Guide Column for 12-18-09

REAL ESTATE PATTERNS
By Ken DuVall

A WONDERFUL CHRISTMAS MORNING!

Here’s my final column for this year. It’s wonderful touching story for your Holiday Pleasure:

Last Christmas I woke up with 6 hungry kids and just $10 in my pocket. Their father had gone. The boys ranged from 3 months to 7 years; their sister was 2. Their Dad had never been around much, although he did used to give me grocery money.

But when he finally left us, the food money stopped. I had to go get a job immediately. I scrubbed up the kids, put on my best homemade dress, loaded them all into my rusty old Chevy Nova and drove off to find a job.

We went to every place in town. The kids stayed crammed into the car and were quiet while I tried to convince whoever would listen that I was willing to learn anything or do anything. I had to have a job. No luck. The last place we went, just a few miles out of town, was the old Root Beer Barrel drive-in that had been converted into a truck stop now called the Big Wheel.

An old lady named Granny owned the place now. She peeked out of the window and saw all my kids. She said she could use me for the graveyard shift, 11 at night until 7 in the morning. The pay was minimum wage but I could start that night! So I raced home and called the teenager down the street that did baby-sitting.

I arranged for her to come and sleep on my sofa at night. She could arrive with her pajamas on and the kids would already be asleep. We made a deal. That night when the little ones and I knelt to say our prayers, we all thanked God for finding Mommy a job. And that’s how I started at the Big Wheel.

When I got home in the mornings I would wake the baby-sitter and send her home with several dollars of the tip money I got every night. The tires on my old Nova had long since lost all their tread and had slow leaks. I had to fill them with air nearly every day. It was no fun at all.

One bleak fall morning, I went to the car to go home from work and found 4 brand new tires in the back seat! I never locked the car because there was nothing to steal. New tires! There was no note, no nothing, just those 4 beautiful new tires. Had angels taken up residence here I wondered? I made a deal with a local service station. In exchange for mounting the new tires, I would clean his office. I remember it took me a lot longer to scrub his floor than it did for him to mount the tires.

I was now working 6 nights a week instead of 5 but it still wasn't enough. Christmas was coming and I knew there would be no money for toys for the kids. I found a spray can of red paint and started repairing and painting some old toys. I hid them in the basement so there would be something for Santa to deliver on Christmas morning. Clothes were a worry too. I was sewing patches on top of patches on the boy’s pants and soon they would be too far gone to repair.

On Christmas Eve the usual customers were drinking coffee in the Big Wheel. There were the truckers, Les, Frank, and Jim, and a state trooper named Joe. The usual musicians were hanging around after their gigs playing pinball. The regulars just sat around and talked through the wee hours of the morning before leaving to go home before the sun came up.

When it was time for me to leave on Christmas morning, to my amazement, my old battered Chevy was filled full to the top with boxes of all shapes and sizes! I opened the door and kneeled in the front facing the back seat. Reaching back, I pulled off the lid of the top box. Inside was a whole case of little blue jeans, sizes 2-10! I looked inside another box: It was full of shirts to go with the jeans!

Then I peeked in some of the other boxes. There was candy and nuts and bananas and bags of groceries. There was an enormous ham for baking, along with canned vegetables and potatoes. There was pudding, Jell-O, cookies, and pie filling and flour. There was a whole bag of laundry supplies and cleaning items. And there were 5 toy trucks and a beautiful little doll.

As I drove back through the empty streets as the sun rose on the most amazing Christmas Day of my life, I was sobbing with gratitude. And I will never forget the joy on the faces of my little ones that blessed Christmas morning.

Yes, angels had been there. And they all hung out at the Big Wheel truck stop!

See ya all next year. Happy Holidays everyone.

Copy for Real Estate Guide Column for 12-11-09

REAL ESTATE PATTERNS
By Ken DuVall

WARNING SIGNS

Question from a Realtor: “In reviewing the buyer’s financials, I noticed that most of their accounts showed a number of large deposits over the previous 30 days from overseas- Taiwan, Hong Kong and China.”

Answer: They might want to report this to law enforcement authorities. There are no hard, fast statistics as to the extent criminals are using real estate to place their illegal gains into the financial mainstream. But the FBI suspects that money laundering in home purchases is becoming more common.

So much so that the Financial Crimes Enforcement Network, or FinCen, is considering a rule requiring Realtors, among other entities which don't have a direct financial interest in property sales, to file suspicious activity reports that lenders have to file when they smell something fishy.

While mortgage fraud and money laundering are often viewed as separate criminal enterprises, FinCen, a bureau within the U.S. Treasury department that collects and analyzes information about financial transactions in an effort to combat crime, has found they are often interconnected.

"Despite the relative illiquidity of most real estate assets," the agency says, "money launderers have used residential mortgage transactions- fraudulently, though legitimately structured- to mask the cash proceeds of crime."

Indeed, collusion between the bad guys and Realtors, builders or contractors, has been found to be rare. But it does happen. And either way, FinCen says the housing sector "may be vulnerable at all stages of the money laundering process."

‘Cleaners’ use many techniques but one of the most prevalent is the use of multiple straw buyers to secure home loans. The ploy is similar to one used by many who commit mortgage fraud. But once the loan is funded, the actions of the launderer diverge from those of the fraudster.

The fraudster, who generally employs a dishonest appraiser to inflate the value of the property and thereby the amount of the loan, takes the money, flips the property, and runs. The cleaner, on the other hand, will strive to project an image of normalcy by continuing to make regular loan payments.

In a process the authorities call "layering," the launderer will not only use illicit funds- from the illicit sale of pirated DVDs, or perhaps a string of robberies, etc.- as a down payment to secure the mortgage, but also will pocket the money from the inflated loan, and then use the ill-gotten gains to make payments.

There could be a good reason for the buyer’s rush to close, but if the buyer can't give one, your antenna should wiggle. Transactions involving persons residing in known off-shore tax havens often are funded by laundered money.

So are those involving someone who refuses to reveal a current address or lists it only as a P.O. Box. There are a lot of creative crooks out there anymore. Be careful. The FBI could even hold you in as an accomplice to their illegal activities! You gotta know which bridges to cross and which ones to burn.

Ken owns Ken DuVall & Associates, REALTORS at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings and all his columns at www.KenDuVall.com. Call Ken at 345-3700 for all your real estate needs. Free consulting.