Get Rich Quick Schemes For The Rest Of Us: Rent Out Your Neighbor's Foreclosed House
When it comes to "get rich quick" housing schemes, one can be a bank prop trading desk or a hedge fund, with access to the Federal "REO-To-Rent" program which grants a costless purchase of distressed real estate with zero cash down, in order to facilitate the subsidized removal of housing inventory from the market, or, if one is not too big to fail, one can simply pull off an Andre Barbosa, the infamous Boca Raton squatter who used the "adverse possession" loophole to claim title to a multi-million mansion. Or, as it turns out now, one can take advantage of the latter and lever it up even more, by renting out other people's foreclosed property without ever being present, while claiming ownership rights through "adverse possession", keeping the inbound cash flow while having someone else on the hook should the cops come knocking.
From Palm Beach Post:
A West Palm Beach woman is accused of commandeering her neighbor’s empty and foreclosed-upon home, renting it through Craigslist and collecting more than $13,000 in rent before the owner discovered the ruse and called the cops.
Nathalie Heil, 30, was booked into the Palm Beach County Jail on Friday. Facing charges of grand theft and fraud, she was released Saturday after posting $6,000 bond.
But Heil said she believes she has ownership of the house, stating that she filed what’s called “adverse possession” papers. The arcane Florida law, created hundreds of years ago, states that if a person claiming adverse possession stays in a home for seven years, paying taxes and caring for the property, they can take permanent ownership.
In other words, Nathalie took Andre's idea and levered it up.
Andre De Palma Barbosa, the 23-year-old Brazilian now known as the “Boca Raton squatter,” used adverse possession to move into an empty foreclosed 7,000-square-foot mansion in Boca Raton in December.
As for Heil, she said the owner of the property at 314 Vallette Way abandoned the home more than six years ago.
She assumed that as soon as she filed her papers with the courts, the property was hers.
“Legally, I thought it was right,” she told the Palm Beach Post.
Heil said she’s received death threats since the story first ran on the Post’s website Tuesday afternoon.
“I’m freaking out,” she said. “I have a full-time job and I’m a single mom.”
West Palm Beach police were tipped off to the situation Friday morning, when they got a call from Kelly Keefner, who manages the 314 Vallette Way property for her father-in-law, Juan Cedeno. Keefner told police the home is in foreclosure, and for that reason she had not checked on the property in the last eight months. She said when she stopped by in late January, the place looked lived-in.
Keefner returned to the home with her husband and met April Wehle, 24, and Talia Williams, 25, who said they had been renting the home for $1,500 a month since mid-June. The women said they found the place through a Craigslist ad placed by Heil, who lives next door at 312 Vallette Way.
The women told police they’d paid a total $13,500 in rent by check to Heil and spent another $500 to make various repairs, according to Heil’s arrest report. The home sits south of downtown and just blocks south of the Mango Promenade historic district, tucked between S. Dixie Highway and S. Olive Ave. south of Okeechobee Boulevard.
After confirming Cedeno’s ownership — the county property appraiser lists him as the owner of record since 2007 — police said they confronted Heil when she went to the home to collect rent. Heil told police she had gone to the county courthouse and “completed paperwork giving her possession of the residence.”
Police said they found no such paperwork, and property records name Cedeno as the owner.
That said, please don't let stories like this get in the way of a housing 'recovery' myth, which just happens to be a function of Chinese and Russian robber barons taking advantage of the NAR's anti-money laundering exemption, giving them full right to invest suitcases of stolen cash in US real estate, while the same NAR reports, month after month, that US housing is as sturdy as it was during the peak of the last housing bubble.
After all, with Bernanke watching out for everyone, what can possibly go wrong.
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