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Second installment: Idiocy #1 – That a person can purchase a property which they already own.
The doctor sees all the weaknesses of mankind, the lawyer all the wickedness, the theologian all the stupidity.
I am neither doctor nor lawyer nor theologian. But, according to Cipolla’s Five Laws of Human Stupidity, all of us pay the price for the actions of stupid people even though we likely helped those people ascend to positions of power over us.
Let’s cut that out.
And, be sure to read the introduction –
Stupid Judges Harm You More Than Malicious Judges Do
- a short philosophical preface to this application of the Laws of Human Stupidity – at:
…and I will tell you of particularly stupid things judges – especially one judge – have done and are doing.
My formula for stupidity
Ignorance + Arrogance > Stupidity
If my calculation has merit, and if Cipolla’s Second Law of Human Stupidity - the probability that a person is stupid is independent of any other characteristic possessed by that person is accurate - it is self-evident that stupid people populate every group or segment of society from
Arrogance added to Ignorance produces Stupidity.
It’s inevitable.
Cipolla’s definition: A stupid person is a person who causes losses to another person, or to a group of persons, while deriving no gain for himself, and possibly incurring losses.
The list of idiotic statements, rulings and orders from the 231st (Tarrant County, TX) could fill volumes. My list only includes those matters that affect mortgage financing (and residential real estate) as it impacts and is impacted by divorce. That’s my specialty – I invented it. It’s called Divorce-Lending.
The players are listed below under “Notes.” The case is NO. 231-715459-22 and the hearing in question took place at 9:00 AM August 3, 2023.
Idiocy #1 – That a person can purchase a property which they already own.
My customer - the wife in this divorce action - wanted to keep the house. Husband didn’t want it and Wife was able to refinance its debt into her liability only and include a fair buy-out of Husband’s interest in the house. Months of back and forth filings and hearings and Rule 11’s and nonsense had resulted in no actual final divorce, no awarding of the house and no loan closing – that is, no one had turned their silly white paper into green money.
I got involved quite late in the process when wife called our office and asked for help. It’s always best if people work with me as early as possible but we surely never turn folks away if their divorce has finalized or if they are in the middle of a freakin’ “Charlie Foxtrot.”
When I examined the communications I saw why my new customer could not seem to get her divorce finalized, why she was about to lose her house.
Here’s why: NOBODY knew what the hell they were talking about. Everyone – the attorneys, the realtors and the receiver, even the mortgage loan officer (who was also an attorney) - was giving my new customer ridiculous, silly, nonsensical and completely erroneous advice – outright false information. And this was the cornerstone of such a messed up case. Tens of thousands of dollars, countless hours that courthouse bureaucrats complain about not having enough of – all because of intolerable arrogance without the humility to cure their ignorance.
The completely erroneous misconception they were all trying to perpetrate was that Wife had to make an offer to purchase her own house. The licensed realtor/receiver had even proffered a Texas Real Estate Commission promulgated form, filled in. All she had to do was commit (what is tantamount to) fraud and sign it. Wife was the ONLY person in the whole case who suspected that something wasn’t right.
Of course, the judge believed all the idiocy he was being told. He should know better and I cut him, Jesus Nevarez, no slack in this regard. His arrogance manifested in bullying and bellowing from the bench, disallowing the slightest bit of education or explanation from me. So, it was clear why he was so ignorant. I can’t even guess as to why he’s so arrogant.
OK – Time Out. I ask you a simple question. It is not a trick question. It is straightforward.
Can a person purchase something that they already own?
Ask anyone in your house over the age of 4. They probably know.
It is complete fiction, legal and logical, that someone can own something and still purchase it.
In fact, the only transaction needed was – NOT A PURCHASE BUT – a refinance loan to include a buy-out to husband. It’s really simple. I’ll explain later. For now, it’s not the purchase of a property but the refinancing of the debt on that property that is needed to satisfy all the concerns and needs of BOTH parties. And that would include the satisfaction of an Owelty interest if it were properly specified in the divorce decree.
Here, I’ll try to make this so simple that even a judge could understand it.
The only thing being “purchased” is an ex-spouse’s interest in the property. But, even then, the proper term and understanding of the transaction is not that of a “purchase.”
Not a single officer or party or witness – other than me - in Jesus’s court knew this until I forced the issue. Not Judge Jesus, not the two attorneys, not even the realtor, NOT EVEN THE LOAN OFFICER. None of them knew the difference between the purchase of property and the “purchase” of a co-owner’s interest in a property. Every one of these amateurs thought the necessary transaction could have been accomplished with a purchase contract.
It's no cause for bragging that I understand this very basic principle. Most humans over age 4 know this.
As it began to dawn upon these amateurs that they had held out the wrong type of transaction, their questioning and conversation morphed into that of a “refinance.”
“Do you understand what we’re trying to accomplish here, Mr. Cookman,” asked the Liz Rivera, wife’s attorney.
“I’m pretty sure God doesn’t understand what in hell you are trying to do” went through my mind. But, “no,” I answered. In the moment, I had withheld any suspicion of corruption, graft, theft and equity-stripping. How naïve I was.
No doubt, Rivera will claim that she knew all along that the transaction had to be a refinance with a buyout; and that she and everyone else understood the transaction perfectly. But, this will also be complete fiction. As you will see in Idiocy #10, Rivera herself entered an Approval Letter from Joseph Soto (mortgage loan officer) that declared the transaction a “Purchase Pre-Approval.” I’ll show it to you in that installment of The Idiocies of Judge Jesse Nevarez & Lawyer Liz Rivera.
“You have to make an offer and beat out the highest offer the receiver has received,” Rivera told Wife. As well, “Noel Cookman is the reason you’re going to lose your house,” said Rivera. This was based upon my report that Wife needed to offer or negotiate a price for her Husband’s interest in their (jointly owned) house.
Lawyers who have attended my CLE webinars or read my material are probably bored right now because YOU ALREADY KNOW THIS AND ASSUME THAT YOUR FAMILY LAW COLLEAUGES AND PEERS KNOW IT TOO. How mistaken you are – this ignorance is widespread enough to create massive loss for divorcing citizens all across the U.S., not just in Texas.
To be sure, before the hearing, I wrote Liz Rivera and told her exactly what the transaction had to look like.
So, don’t believe anyone that “late to the party” when they tell you “Oh, I knew all along; but, my client is so dumb she wouldn’t know the difference between a purchase and a refinance.”
I am convinced that she just couldn’t get it. Maybe the $4,000 retainer she took from Ms. Rodriguez did not include reading up on the subject about which she would be claiming omniscience. Then again, after watching her performance in court and listening to her meaningless, nonsensical questions, I think I’m going with “she just doesn’t get it.”
As astounding as it is that an attorney who brags about proficiency in real estate does not know this basic fact, a licensed realtor and a licensed mortgage loan officer should surely have known that it borders on fraud to portend a purchase of a property which one already owns.
I’ll tell you what professionals would know this fact. Those in title insurance. But, on those occasions when homeowners don’t know any better and present such a transaction to the title company, the title agents will kindly (i.e, not roll their eyes in front of the customers) make some adjustments, produce the necessary documents (“Owelty” docs, in the case of a divorce or co-heir buyout) and quietly shred the purchase contract so that there is no record of people’s ignorance.
The reason they know this basic fact of property and financing transactions is because title companies have to insure that transaction and a buyer cannot receive seller funds (net proceeds) or any funds as a seller. Neither may the seller remain as an owner having given all of their interest in the property to the buyer.
Repeat after me: You cannot purchase what you already own.
If you forget, just ask a four-year old. They know.
Notes
NO. 231-715459-22; Presiding Judge Jesus “Jesse” Nevarez, II; Attorney for Denisse Reynoso Rodriguez (my customer) – Elizabeth Rivera; Attorney for Edwardo Huerta – James Masek; Witnesses and Beneficiaries of Judge Nevarez’s bestowments and judgments: David Meyers (real estate, receiver, agent), Joseph Soto (mortgage loan officer)
Note for practice. When the house is in question, the straightest path from A to B is to involve me or my team in the financing that is required to complete the transaction.
I solve these types of problems “in my sleep” so to speak. They’re not that difficult. Stupid judges, realtors-receivers, and mortgage loan officers find ways to screw it up. Even parties possessed of some animosity can usually be made to understand logic and dollars. I seriously doubt Husband in this case really wanted to spend more in legal fees to watch a Kangaroo Court.
Next installment: Idiocy #2 – That a judge can determine value, equity and therefore a fair and equitable buyout.
Noel, as I've often told folks who find themselves as I did in early 2018, never trust an attorney to know what you need to do acquire a spouse's interest in your home if you're going to be the one acquiring said interest. Not unless you just feel like handing over thousands of dollars in totally unnecessary attorney's fees, that is!
A college friend of my wife's has just separated from her husband (his choice, due to his infidelity and substance abuse), and may be in need of your services. I want to ask her to reach out to you for a consultation. She has a HS junior, and she wants to be able to stay in the family home at least until she graduates. I think the verbal "agreement" she has with her husband is that he will continue to pay for the home and utilities until that time. But the concern is what happens if he decides to pressure her to sell the house? She hasn't worked outside the home in years, and is significantly less financially able to keep the house if should renege on his verbal agreement. I'd wonder if her ability to purchase her ex's interest in the family home would require her to have sufficient funds of her own to do so, or if she could couple this with court ordered spousal support to continue making the payments for her and her daughter, without him having an interest in a future sale of the house? I know this is a hypothetical, and that you're not a lawyer - I'd just want to be able to give her a frame of reference of what you can or cannot do as your client.