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Monday, December 30, 2013

UNDERCOLLATERERALIZED? On Deck Sports Bar and Grill Investors Pony Up Nearly $500K In Hard Money Loans Just Weeks Before Fire ; Investors Hang In The Balance

EXCLUSIVE-BREAKING NEWS!

Miss Fortune has discovered that Robert Buckhannon and Kelly DeMoss, on behalf of the On Deck Sports Bar and Grill, went fishing in the commercial hard money market in October, putting 27 new investors at potential risk while reeling in a $456,000 mortgage loan.

Official Calhoun County Register of Deeds records reveal that the warranty deed for the four Battle Creek "lots"--lots 60-61 and 70-71--was recorded on November 5, 2013 showing the October 8 sale amount as $107,000.  According to official Battle Creek property records, the legal description for 225 W. Michigan Avenue follows:

BC CITY RB4 PART OF LOTS 60, 61, 70 & 71: DESC AS COMM NW COR OF LOT 65 - S 74 DEG 30 MIN 00 SEC E ALG SLY LI OF MICHIGAN AVE 277.50 FT TO TRUE POB - CONTN S 74 DEG 30 MIN 00 SEC E ALG SD SLY LI 46.95 FT - S 15 DEG 30 MIN 00 SEC W 94.46 FT - S 74 DEG 30 MIN 00 SEC E 10.22 FT - S 15 DEG 30 MIN 00 SEC W 40.54 FT - N 74 DEG 30 MIN 00 SEC W 57.17 FT - N 15 DEG 30 MIN 00 SEC E 135 FT TO POB, SUBJ TO & TOGETHER WITH EASE OF RECORD ((ASSESSED WITH 0254-00-084-3 IN 1996))

On the same day, a $456,000 mortgage was recorded against the On Deck property with these 27 mortgagees/investors:

Party TypeParty Name
MORTGAGORON DECK SPORTS BAR & GRILL LLC
MORTGAGEEBLACKBURNE & BROWN MORTGAGE FUND I
MORTGAGEEBLACKBURNE & BROWN MORTGAGE FUND II LP
MORTGAGEEVOLUNTINE JACK E TRUST
MORTGAGEEVOLUNTINE NANETTE M TRUST
MORTGAGEEHOTTMAN TERRY
MORTGAGEEHOTTMAN CAROL
MORTGAGEESTERN FRANK
MORTGAGEECHOY FAMILY TRUST
MORTGAGEEWOLF SURVIVORS TRUST
MORTGAGEEGEE TOM W
MORTGAGEEGEE MAY W
MORTGAGEESAM PHUNG INVESTMENT LLC
MORTGAGEEFEYS EARL L
MORTGAGEEFEYS AIZHEN
MORTGAGEEJENNINGS FAMILY TRUST
MORTGAGEEWOLF ACK
MORTGAGEEEDWARDS DAVID G 401K PROFIT SHARING PLAN
MORTGAGEENORMAN MARK TRUST
MORTGAGEESADDORIS FAMILY TRUST
MORTGAGEELESKY OLAF
MORTGAGEELESKY KRYSTYNA
MORTGAGEESTEPHENSON MARK
MORTGAGEEKUCHARSKI FAMILY TRUST
MORTGAGEEGENDRUEAU AVA
MORTGAGEENELSON ELIZABETH C TRUST
MORTGAGEEBHOLA KRISTNA
MORTGAGEEBHOLA JENNIFER W

The legal dispute between former Robert Buckhannon business partner Stephen P. Anderson that temporarily closed the restaurant was recently settled, and the bulk of the money likely went to satisfy the terms of the confidential settlement agreement.

Hard money loans for commercial real estate are often a matter of last resort. They aren’t good deals, but they can save a financing situation that has gone critical. Most hard money loans come with significant upfront costs and astronomical interest rates. 

But hard money loans are backed by the value of the property, and not the credit worthiness of the borrower.

Now could a guy like Robert Buckhannon give investors a false sense that short-term, high interest hard money loans were secure and likely to be repaid?

Looks to your girl Miss Fortune that he may have done just that--over and over...and over again.

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