Sunday, July 22, 2018
Business

Another Pinellas foreclosure auction fools bidders, raises questions

For the second time in six weeks, a company connected to lawyer Roy C. Skelton stood poised to profit from a Pinellas County foreclosure auction that confused even experienced real estate investors.

Like the case of a gulf-front condo that sold for $458,100 in June to an unsuspecting bidder, a Largo townhouse sold for $112,300 last week to a man who thought he was bidding on a first mortgage and would own the home free and clear.

PREVIOUS COVERAGE: Florida couple stunned to learn $458,000 paid for gulf-front condo may be for nothing

In both cases, the auctions involved second mortgages and amounts far higher than what a Skelton-connected company had paid for the properties.

"One of the (many) things that is so dangerous and deceptive about this scheme is that even with a formal title search, a bidder wouldn't be clearly warned about what was occurring here,'' according to a motion filed Tuesday by attorney Matthew Weidner, who represents the winning bidder for the Largo townhouse.

After realizing he would not own the home outright, the bidder declined to pay the $112,300, which was due Monday. However, he will still forfeit more than $5,500 in deposits unless he can convince a judge there was a problem with the auction.

Meanwhile, the high bidder on the gulf-front condo is still fighting to get back its $458,100. The Pinellas clerk's office has stopped payment on a check it wrote to Skelton's Deutsche Residential Mortgage Company and — despite Skelton's threatened legal action against the clerk — will not disburse the money without a court order.

A hearing in that case is set for Aug. 21.

Skelton, a Clearwater lawyer and real estate investor, denied any intent to deceive or mislead potential bidders.

"Everything is filed in the public records for all who bother to look will see," he said in an email Tuesday to the Tampa Bay Times. "If a potential bidder is misinformed it is solely due to their failure to do the due diligence that the law requires. There is even a link to the final judgment on the bidding web site for every foreclosure sale. As the Florida Supreme Court has stated, when it comes to judicial sales, the rule is caveat emptor.''

Both cases began the same way — with Skelton's Outbidya, Inc. acquiring title to the properties through homeowners association foreclosure auctions. Investors like HOA auctions because they typically can take title for much less than the property is worth and rent it out until the bank eventually forecloses.

As the Times previously reported, Outbidya, Inc. paid $157,800 two years ago for a unit in the Ram-Sea condominiums in North Redington Beach. But shortly after Wells Fargo began foreclosing on the first mortgage, Skelton incorporated Deutsche Residential and issued a second mortgage to his Outbidya.

Earlier this year, Deutsche said Outbidya had defaulted, and obtained a final judgment of foreclosure. At the auction in June, John and Christine Houdes' Orlando Realty Group submitted the top bid of $458,100 for the condo. Through their attorney, the couple has accused Skelton's company of "hijacking" the Wells Fargo proceedings to make it appear the bidding would be on a first mortgage.

Had that been the case, Orlando Realty Group would have owned the condo outright and Skelton's company would have gotten nothing. Instead, it was able to beat the bank to foreclosure and could potentially reap almost the full $458,100.

A similar sequence of events played out over the Largo townhouse.

Last year, Skelton's Outbidya paid $20,100 at a homeowners auction for title to the townhouse off Ulmerton Road. Barely a week after the lender began foreclosing, Skelton's First Florida Residential Mortgage issued a second mortgage to his Outbidya.

First Florida then claimed that Outbidya defaulted on the mortgage, and in May got a final judgment of foreclosure for $100,391. But First Florida never received court approval to become a party to the first mortgage case and thus had no legal right to foreclose on its second mortgage as part of that case, Weidner's motion says.

The motion seeks to invalidate the sale and return the deposit to the high bidder, Dream Homes & Creative Renovations of Palm Harbor.

Neither Dream Homes, incorporated by Enas Al Titi, nor the runner-up who bid $112,200, David Wonsick, could be reached for comment. Records indicate that both men are experienced investors. Dream Homes owns three non-homesteaded properties in Pinellas. Wonsick, a real estate agent, has been involved in dozens of transactions through DW Homes, Inc.

Despite cries of foul, the Pinellas clerk's office says there's not much it can do to block allegedly questionable foreclosure auctions.

"We are bound by what final judgment says. The role of the clerk is just to hold the sale," said Rod Tabler, the office's senior manager of civil court records. "I don't know if legally they (Skelton-connected companies) are doing anything wrong. Yes, it looks suspicious but the court would have to determine whether they're doing something that may be fraudulent."

Contact Susan Taylor Martin at [email protected] or (727) 893-8642. Follow @susanskate

Comments
Some not-so-tiny obstacles in the growing market for tiny houses

Some not-so-tiny obstacles in the growing market for tiny houses

When Tom Alsani heard about plans for a tiny-home community in St. Petersburg, he got so excited he immediately wanted to know more. "Right now I have a house with three bedrooms but the kids are gone and I’m trying to downsize,’’ says Alsani, a qual...
Updated: 21 minutes ago
WalletHub ranks Tampa in top 20 best big cities to live

WalletHub ranks Tampa in top 20 best big cities to live

TAMPA — Tampa made WalletHub’s Top 20 list for Best Big Cities to Live, coming it at No. 16. The personal finance website released its annual report on Monday, which evaluated 62 of the largest cities in the U.S. based on affordability, economy, educ...
Updated: 22 minutes ago
Author drills into federal government’s role pushing segregation

Author drills into federal government’s role pushing segregation

Before researching his latest book, Richard Rothstein had some vague ideas about why residential segregation took root in so many communities during the 20th century.Like many of us, he had little reason to doubt the de facto explanation: A history o...
Updated: 1 hour ago
St. Petersburg cites hotel in Historic Uptown for code violations

St. Petersburg cites hotel in Historic Uptown for code violations

Times Staff WriterST. PETERSBURG — The owner of the popular Hollander hotel has been hit with a notice of code violations at a hotel he is currently renovating. A city codes investigator found that Lake View House at 465 Seventh Ave. N is operating w...
Published: 07/23/18
At beach resorts, this bizarre sunscreen booth can mean business

At beach resorts, this bizarre sunscreen booth can mean business

Nothing will ruin your beach vacation faster than a sunburn.Get scorched, and suddenly everything that was meant to be fun isn’t: Massages at the spa hurt, day-drinking by the pool hurts, getting on jet skis hurts. Listening to your skincare-obsessed...
Published: 07/22/18
He was fired after an encounter with a ‘racist’ customer. After sharing his story, Home Depot changed its mind.

He was fired after an encounter with a ‘racist’ customer. After sharing his story, Home Depot changed its mind.

After a man last Thursday approached the checkout at a Home Depot in Albany, New York, staff member Maurice Rucker asked him to leash his dog. That’s when the man exploded.Rucker, a 60-year-old black man, claimed he was fired Tuesday after defending ...
Published: 07/21/18
Open office plans are as bad as you thought

Open office plans are as bad as you thought

A cubicle-free workplace without private offices is supposed to force employees to collaborate. To have them talk more face-to-face. To get them off instant messenger and spontaneously brainstroming about new ideas.But a recent study by two researche...
Published: 07/21/18
Rays 2020 brings ‘road show’ to Sun City Center Chamber

Rays 2020 brings ‘road show’ to Sun City Center Chamber

SUN CITY CENTER — Business leaders and volunteers determined to help the Rays baseball team find a new stadium home in Ybor City are willing to go to every corner of Tampa Bay to raise awareness and support.Including Sun City Center.Tampa Bay Rays 20...
Published: 07/20/18
Updated: 07/22/18
Officials speak out against demolition plans for historic Jordan Park section

Officials speak out against demolition plans for historic Jordan Park section

ST. PETERSBURG — Pinellas County School board chair Rene Flowers was fired up Friday. She talked about growing up in Jordan Park, the city’s first public housing project and a sentimental and historic marker of St. Petersburg’s African-American commu...
Published: 07/20/18
Florida is still paying SunPass contractor, even after officials said they would stop

Florida is still paying SunPass contractor, even after officials said they would stop

Florida has not stopped paying the SunPass contractor responsible for the tolling system’s outage, even after transportation officials said the state would suspend all payments.In a letter on Monday, FDOT secretary Mike Dew said the state would not p...
Published: 07/20/18