I'm a commercial mortgage broker outside of Orlando, FL, who's been in the business the better part of 15 years. A while ago, I closed a loan on an $8,000, 000 motel through an investment banker in Tampa, FL. Unfortunately, I attempted to use a hard-money lender before I found this banker and it's this guy I'd like to warn everybody about.
His name is Joe Siegel and he operates out of Denver, CO. He offered reasonable terms on the deal at the outset and so I thought I'd pursue things with him. Siegel told me his advanced fees were $45,000 but that he'd only require $5,000 up-front. That would allow him and his associates to do their due diligence before proceeding with the deal.
He explained that he would use the $5,000 to review the appraisal and analyze the business tax returns and other documents he asked of me and my client.
He went on to say that if and only if the numbers made sense and he thought he could do the loan, only then would he request the other $40,000 and fly out to Orlando. He would then walk the property and inspect the motel, interview the staff and owner-seller, and review their books - all so as to confirm that the deal looked as good in person in Orlando as it did on paper in Denver.
He added that if his analysis (back in Denver) was that the deal wasn't "do-able", he would not come out to Orlando (let alone request the other $40,000) and that he would refund any unused portion of the $5,000 fee advanced him.
Well, he did get the other $40,000 from us and he did come out to the Orlando motel. However, he performed the most minimal of inspections and interviews, and left late the next morning to meet another client in New Jersey. He did make a point of telling us (me, the broker-owner of our firm and the owner-seller of the motel) that he would contact us with his proposal within a week.
A week came and went, and when I finally got in touch with him - yes, I had to call him, several times! - he didn't remember who I was, let alone why I was calling him.
After reminding him, he launches into hyperbole the likes of which I've never heard before in the 15 years I've been in this business - and I work in So. Florida, the loan fraud capitol of the country! He went on about how, when he ran the numbers and laid it all out on the table and threw it against the wall and ran it up the flagpole and realized that no one was saluting and the appraised value upon further review wasn't really there and his final considered opinion is that it's really not a viable deal. Sorry.
I asked him what the heck he was talking about!?! If - and I mean, IF - all of that (whatever the heck he said) was really true, why the heck didn't he do like he lead us to believe he would in the beginning: tell us the deal wasn't viable, return any unused portion of the $5,000 and tell us he wouldn't be coming to Orlando?! He didn't seem to have answer for that.
I asked him what his appraiser made the FMV to be, after reviewing our appraisal. He couldn't or wouldn't say. I asked him for a copy of his financial analysis, the appraisal review or anything else to substantiate the nonsense he was spewing forth, but he said that was all 'proprietary'.
I got angry with him, telling him that he clearly ripped my client off for $45,000 and that he'd be hearing from the broker-owner of our firm and/or my client's lawyer. After a little hemming and hawing, he asks for a "demand letter" and says he'll be able to get a refund to us with that.
A month or more goes by, a lot of phone tag, and then he finally explains to my broker that he really needs a "demand letter", not from us, but from our client, stating that he no longer requires Siegel's professional services. Within one (1) week of receiving this letter, he says he'll get us the refund for our client.
Yesterday (9/8/05), that one-week period was up - and guess what?! No money from Siegel.
So, let this be a warning to mortgage brokers looking for a last-resort strategy of hard money: Based on my experience, I would strongly advise you, DO NOT TRUST MR. Joe siegel of satisfaction r.E.I.T.in DENVER, CO.
BTW, I believe he promotes himself through weirdloans.com, but unfortunately they have no place to post feedback like this.
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