The Vue Charlotte: No Way In, No Way Out

If we try and look at the bright side of yesterday’s message from MCL and the VUE Charlotte, it is this. They finally communicated with us again, outside of one-on-one. Granted, that would not have been my preference for the first words to us since the letter from Dan McLean some months back, but we will take what we can get!

There was a range of comments yesterday, and maybe (I hope) there will be some more today, but as I attempt to do in the blog, I try to understand all points of view. I also try to make inferences and deductions from the information I receive.  So what do we make of yesterday?

The blog had been focusing on whether we were liable for damages beyond the downpayment. The case MCL posted is actually different from that. The case yesterday is about having the means to close, but then not doing so.  An interesting twist that we hadn’t looked at in the blog, but certainly now warrants another visit with Larry the Lawyer.

The first part of the title in this post is No Way In. I know many of the readers I communicate with say they have No Way In. The economy has changed and they no longer have the means. The question is, how many of the pre-sales buyers does this represent? So far I have heard appraisals come in from as low as 10% to as high as 40%. If these appraisals continue to fall short, sometimes well-short, of the contract price, this is bound to drag a good number of people into the “No Way In” category. Couple this with the people that no matter whether they have a way in or not, they are not going to move forward, then how many of the 200 pre-sales buyers do you have left?

You could say from yesterday’s post that MCL believes that enough buyers out there have the means and therefore they may choose to take legal remedies to require them to close. I suppose if this is enough of the buyers it would be a costly way to go, but maybe better for them than just having buyers walk away. I have no way of knowing how many people fall into this category.

During the first few posts in this blog, a broker told me (and I am paraphrasing)  “MCL will need to find a way to hold the pre-sales together, and I am sure they will do that.”  I highly doubt that when this broker shared this with me, he had the tactic posted yesterday in mind as a means to do so. So what I am thinking, is given the post yesterday, I can infer with great confidence, that the pre-sales are in deep trouble. My fear, for both us and for MCL, that for many of us, there is No Way In, but for all of us,  there seems to be No Way Out.

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2 Responses to The Vue Charlotte: No Way In, No Way Out

  1. Holly says:

    You are far too kind Mike. You were written an anonymous letter from the developer from a made up email address. Then another anonymous one from an MCL address. Both contained threats veiled in a horribly amateur “see attachment” fashion. These guys are crooks, unprofessional, and not worthy of selling (let alone building) a condo worth anywhere from $250k-1.5 million purchase price, not to mention that the market value is now probably half that. I say run, and run fast, away from this building.

    Also, I believe you may be giving too much credence to the court document that was sent. Is Larry the Lawyer a top pro in this space, or just some guy? Let’s get the input of a top real estate attorney or contract lawyer and see what we have on our hands here. This fight will not be for amateurs, we are going to up against top attorneys, likely very aggressive, and my bet is Larry isn’t a worthy opponent, but there is a worthy opponent out there. Let’s find one.

    Lastly, if we think that MCL will selectively sue only those with means to close, we are dreaming. How will they know who does and doesn’t have the means? They’ll sue everyone who doesn’t close, and if you plan not to close (whether you have the ability to or not) you’ll have to hire an attorney and fight it at least for some time (and money). We need to file a class action suit.

  2. Holly says:

    I hope your readers don’t mind me constantly weighing in, but I had another thought relative to the value of the condo you put money down on.

    If you bought a 500k unit you put 15% down, or $75k. So you owe $425k. If you close, MCL gets in total $500k. MCL says this unit is now worth approximately $550 according to their published prices for new buyers. If MCL let’s you walk away from your $75k, and they then sell the unit for $550k, they make $625k, a difference of $125k, or 25%.

    Yes, they would lose some time value of money in such an equation. But they would make an additional 25% on their unit, enough that could justify even 2 years of time value.

    The reason they won’t do this? Because they know what we know, and that is that the $500k unit is worth $350k at best.

    Lastly, I need to emphasize that I am not unsympathetic to MCL’s situation. But they should work with us, not threaten us. I’m doubtful such fairness and reasonableness is in their DNA.

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