Wednesday, October 10, 2007

Tip of a very large iceberg

Two held as huge losses investigated by police

Only two arrests so far, but "many investors ended up having properties repossessed" How do "investors" fall for this sort of scam. Johnette Motler will have a long time to sit in her armchair, if that is not reposessed as well. How many more schemes like this are there ?

Posted by yorkshireman @ 02:51 PM (1512 views)
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13 thoughts on “Tip of a very large iceberg

  • David Smith's Sub Prime. . . says:

    Johnette Motler, 62, lost £1.7m after taking out mortgages on six properties, including two ‘luxury’ en-suite apartments in the Hyde Park area of Leeds.

    Well ….. ?

    But nevertheless this is warming up all over the country if one looks at the Thamesmead scam. Quite interesting….Watch this space……..

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  • these Germans are not so stupid as it seems! the word [i]schadenfreude[/i] has never been so valid

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  • Talking about BTL: “The investigation of the market in which investors buy up property to rent at a profit”
    Doesn’t seem a particularly accurate summary these days!

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  • little professor says:

    Ooh, I just logged in to post this article after seeing it on the newstand.

    Great article. Some highlights:
    Losses of millions of pounds in the Leeds buy-to-let market are being investigated by the Serious Fraud Office.

    The investigation of the market in which investors buy up property to rent at a profit, focuses on the roles of property valuers, surveyors and lawyers involved in the deals.

    Many investors ended up having properties repossessed because they had been overvalued and investors could not charge enough rent to meet mortgage repayments.

    Johnette Motler, 62, lost £1.7m after taking out mortgages on six properties, including two ‘luxury’ en-suite apartments in the Hyde Park area of Leeds.

    Ms Motler was sold each property on the understanding that it was a complete package. As an “armchair investor” she was told each address would receive a luxury makeover, be already tenanted and be managed for a 10 per cent fee.

    When tenants started to withhold rents due to the poor condition of the properties she looked into re-selling, only to discover she had lost around £100,000 on each investment. All the properties have now been repossessed, and she is in danger of losing her own home.

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  • “Some investors are known to have complained to police that they have suffered huge losses because the properties did not reach their anticipated potential.”

    Selfish b*ztidos .

    Wasting Police time when crimes could be investigated .

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  • planning4acrash says:

    Surely any investor would get an independent valuation of their own if committing to such an investment?! At the end of the day, the people offering the investment had their opinion and she was sucked in. I see no fraud here, just risk given and risk taken, if you go for high yield you could loose it all and valuation is an art not a science.

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  • Totally agree P4.

    I heard about this on Radio 4. The programme did not even suggest that a person should not get into debt without considering whether they can afford it. It just didnt seem to occur to the BBC. How could anyone possibly consider borrowing large amounts without at least thinking about the consequences.

    Sadly the BBC chose to report this as a victim story in the same way as Panorama reported liar mortgages as a victim story. Typical of comfortable government backed lefties out of touch with the real world.

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  • This scam is alive and well in Greater London. The girl who got off at Romford (Havering) was telling the reverse end of a similar story.

    The flat has so many things wrong with it. The owner bought it as an investment and it’s “not paying in”. What amazes me is how quickly some aspiring entrepreneurs stump up cash, yet refuse to accept any responsibility for “doing the job” as landlord!

    Unfortunately, the girl who got off the train will not pay a higher rent. She has little sympathy for the owner who thinks it wasn’t really worth the money after all, and doesn’t want to sink any more cash into “the investment” – just wait till Romford prices drop…!

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  • Fedupwithhouseprices says:

    Ha Ha Ha Ha Ha Ha Ha Serves her right! I love it!! At last these people are getting their come uppance. Oh joy at last!

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  • Good, I hpoe that the minus three salesmen and the director’s of these companies get banged up in jail. The hardships that covert hostile salesmen and their companies have caused apathetic and propitiative greedy people has yet to unfold. We are all going to suffer. Where are the ethical heros and champions in today’s world? The UK has gone down the tube. Thanks for posting this boardf Yorkshireman.

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  • If Gordon Brown had not destroyed the UK pension market people would not be forced to find other ways to invest in their future.

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  • I have had a bad experience with Morrisprops but got out before it went to far. They offer a rental guarantee but after paying a reservation fee (i was not told that this was no refundable) of £5000 was informed a few days later that the guarantee did not form part of the contract so in my reckoning is worthless, when contacting Morris to cancel i was informed that the reservation fee was non refundable.

    Is this just another Scam?

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