Placing a lien on a property to get cash back at closing!
Hey Board,
I have a property I was assigning to a buyer, the buyer obtained pre-approval from the MB.(Mortgage Broker)
The MB sent my assignment letter/agreement to the lender to see if it could be a part of the transaction, they said that I should not be a part of the transaction and that the buyer and seller should work alone or with a Realtor.
So....I called MY MB and she suggested I place a lien, (a Mechanics lien) on the property now before I let the seller and buyer sign a contract amongst themselves.(While I still have time on the contract).
'My services required a lien on the prop.' 
I've negotiated with the 2nd lien holder for a $20k discount, so the buyers max. loan amount is $150k and the payoff is now $140k (where the previous payoff was $160k).
By placing a lien on the property, I'm now a part of the closing and will get the difference between $150k-$140 = $10k to me in which I'll take out my fee of $3300 and give the remaining $6700 to the buyer for (buyers cash back at closing) so they can fix up the house....or at least have a good start at it.
Any comments or suggestions,
Clif 
[ Edited by pbodys on Date 06/23/2003 ]
What state did you place the lien in,
I have a situation, and I need to place a lien on a house, but what agency handles that, can you help
thanks rvector
or you can be added on the hud statement paying you an consultant for services rendered.... I've done that too... draws a red flag if exceeding 3% of total sales price...
Clif,
The only problem that I can see with that is that you will be responsible for taxes on the whole $10K, even though you give back near $7K to the buyer.
I'd tread carefully with the 'gving back' too, as an inventive loan officer may conscrue that as possible loan fraud.
Roger
Why not record a note against the property for the difference. When the sale closes you will be paid at settlement or escrow depending on which ever area you are in. You would still be liable for the gain, but have a recorded note as opposed to a lien.
Winet, you are correct, cleaner deal. Of course do not record the note only the mortgage or trust deed that secures the note. You then show as merely an existing loan to pay off and no red flags go up.
I ran into one the other day, they filed a Mechanics Lien, back dated a contract of employment to cover and then put a demand for payment in the escrow. That worked but scary, all it needed was some newly admited atty to see it, scratch his head, take a look, examine the instruments from the recorders office and away we go (intent to defraud). Cheers Lucius