Was Cay Clubs a Real Estate Investment Scam?
For those of you that don’t know about Cay Clubs, they were a managed real estate investment company that convinced investors to fund condo conversion projects in high value “beach front” properties.
Unfortunately I know far too many investors who bought a Cay Clubs condo and are now stuck with a real estate investment that’s worth less than what they paid for it. To further aggravate the situation, Cay Clubs also defaulted on its agreement to lease back the property from the real estate investor and has failed to remodel some of the properties.
I’m not going to go into detail about Cay Clubs because the Flipping Frenzy blog has a number of great articles that break down Cay Club’s scheme (scam). It’s eye popping stuff that exposes a calculated scheme to fleece real estate investors. You can read all about it by clicking here.
The one point that I do want to make is that I feel a level of responsibility for introducing Cay Clubs to our group by allowing Ricky Stokes to pitch Cay Clubs at our real estate investment club meeting. Ricky had a slick presentation that packaged a very attractive investment opportunity for real estate investors. I certainly bought into it and put deposits down on two units. In the end I backed out of both deals but that had more to do with good fortune than great insight.
For those unfortunate enough to have bought a Cay Clubs investment property, please email me. I’ve found a solution that may allow you to modify your loan agreement with the lender and reduce your monthly payments.