SoCal man's duplex nightmare serves as warning about 'predatory investors'

Consumer experts have simple advice about real-estate wholesalers: don't use them.

Carlos Granda Image
Wednesday, May 22, 2024
SoCal man's nightmare a cautionary tale about 'predatory investors'
A Southern California man thought buying a duplex would be his dream, but now he's fighting to keep it.

LOS ANGELES (KABC) -- Wigberto Astacio thought buying a duplex would be his dream, but now he is fighting to keep it.

"I've been trying to keep up with the mortgage and everything else," he said.

He said it started when he had issues with his front tenant. Then, after being away for a few weeks for a medical emergency, squatters moved in.

He felt desperate.

He then received mail from a wholesaler who promised to buy properties - as is - for cash.

"One of them actually came to me and told me exactly what I wanted to hear," recalled Astacio. "That they would help me with the mortgage payment, that they would help me legally, that they would also be taking care of the place, preventing squatters from coming in. promised me the world."

He signed the contract but claims the wholesaler didn't contact him for weeks - and there were more and more bills.

Then in early May, Astacio said the wholesaler went to the registrar's office and added itself to the title.

"That's when they come in and they said that, 'No, we're entitled to the property. You already signed it away,' and they didn't offer me any help," said Astacio.

"They made promises about bringing in resources - financially and legally - that they never lived up to, so I really don't know what they spent money on."

When it comes to wholesalers, some consumer experts have simple advice: don't use them.

"There are very few credible wholesalers around," said Consumer Federation of America Executive Director Steve Brobeck. "If you're a consumer, and especially in Southern California, I would be very wary about doing that."

"It's too complicated for most people to deal with them," added Brobeck. "I would simply avoid them."

Kisha Sardin, a local real estate agent who's helping Astacio, looked over the agreement and said it was "very clear."

"The contract was very thorough, it was very clear. He just did not understand it," she said.

Sardin has since been speaking with the wholesaler, saying they've had "a great conversation" and believes they can "resolve the issue as both parties want to come to an amicable resolution."

Brobeck said you have to be careful when you sign anything. Do not feel pressured and always try to get a second opinion. He suggests people get a trusted real estate attorney to look over any contracts.

"They should be willing to give you a contract right up front and give you time to read it - and that means not 10 minutes. That means several days, and be willing to discuss the contract, and also be willing to negotiate the commission," he said.

Astacio is now sending out a strong warning for those who may find themselves in a similar situation.

"I want people to know to make sure you read the contracts. Don't rely on people's words just because they're wearing nice suits, have a nice car or have a big office somewhere, and they talk very politely to you. It means absolutely nothing."