FDLE Investigating Investment Program Involving 303 Homes; Foreclosure Auctions Started On 65%; Lenders On The Hook For Million$

In Central Florida, The Tampa Tribune reports:

• Hundreds of peculiar home sales and foreclosures clustered in low-income neighborhoods in south St. Petersburg have attracted the attention of the Florida Department of Law Enforcement. The deals involved unusual mortgages uncovered last summer in a Tampa Tribune investigative report. The sales are tied to a real estate investment program run by a local businessman. Several buyers complained to police that they bought the properties at inflated values.

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• The St. Petersburg case involves 303 property transactions. A group of 65 real estate investors went through a no-money-down investment program to purchase the homes over a five-year period. [...] When the Tribune's story ran in July, 160 of the homes were in foreclosure. Since then, 38 more have joined them, bringing the foreclosure total to 65 percent of the sales. Lenders are left on the hook for millions of dollars in failed loans.

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• The investment program was run by four companies owned by Tampa businessman Joseph F. Daniele.

For more, see State Joins Inquiry Of Unusual Loans.

In a related story, see Appraiser Evaluates Whether 303 Homes Are Overpriced.