Real Estate-My Dealings with Kip Schoning Corvallis Real Estate "Investor"

This article is a great example of the various hurtful behaviors capitalism tends to provoke and nurture within humyns. The slum lord is rewarded for his predatory greed with all the extravagant niceties the bourgeoise seem to enjoy. He is empowered to act as he does because of the ridiculously abstracted way that land use issues are addressed under the insanity that is capitalism. Meanwhile the actual residents of "his" 100+ living spaces are exploited through rent or other ways such as the one the articles author described with no effective remedies available to them, so that only the most determined and well-financed person can actually extract even a drop of personally relative justice out of their situation, and even then still facing a net loss in the end. What an insane world our species has created.

Hi

I'm sorry to hear of your losses.

I just want to tell you that I found your story very interesting, I don't even live in the U.S. let alone have experience in house purchasing, (I'm a kid who rents) It's just because the behaviour you described mirrors something I have observed myself in a small time scammer I've recently dealt with (the delays, the patterns of behaviour you described generally). And I just want to thank you for sharing the story with the community, because it exposes not only a dodgy individual. But a classic behaviour which no doubt has a name in psychology texts, and has shed light on the behaviour of the little criminal I recently dealt with myself. I also applaud you on your calmly reasoned observations and wish you all the best in putting this expensive saga you've had to endure behind you.

Good luck

Most of the classical economists, including Adam Smith, David Ricardo, and Karl Marx, were very leary of land ownership and the ability of the landlords to extract "rents". Basically, their accusations come from the simple fact that land, unlike industrial commodities, cannot be created or destroyed. The relatively fixed supply of land can lead to all kinds of market exploitations as the population (and demand for land) grows.

If you've studied economics, you probably remember the supply and demand curves. In the case of land, the supply curve is vertical while the demand curve shifts ever-further to the right, intersecting the supply curve at an ever-higher price point. As population increases and land supply doesn't keep up with the increase, the price of land goes up and up and up.

If you've studied Smithian (and Marxian) theory, you should have learned that the price of a commodity is supposed to reflect the amount of effort needed to produce it (the labor theory of value or LTV). This determines the nature of the supply curve, which then determines the price when crossed with the demand curve. But with land, the LTV does not apply in any similar way: yes, there are labor costs to keeping a developed piece of land from deteriorating, but they have far less effect on the final supply curve than "traditional" commodities do, such as material goods and the service sector. The only way to truly alter the supply of land is to develop more (which does carry a labor cost) or to pull some out of the market and sit on it.

Another problem lies in the demand curve, which is quite inelastic (people NEED housing, they don't WANT to enter the market just because it's a good deal). Inelastic demand curves are very steep, meaning that the quantity of buyers in the market doesn't change much when the price changes. (take it and have a roof, or leave it and be homeless)

Now do a little experiment: get two sticks or straws (or any thin, straight, line-like objects) and put them on your table or on some sort of coordinate grid. Line one up so that it is "vertical" and line the other up so that it is almost vertical but sloping steeply down and to the right. Make sure that the two "lines" intersect each other. Get a friend to hold the vertical line (the supply curve) in place, and then "shift" the steep downward-sloping demand curve a little bit to the right WITHOUT changing its angle or slope. Notice how much the intersection curve shifts upwards! This implies a large price increase for a small demand increase.

Realtors will always have an incentive to exploit the inelatstic demand curve and squeeze more profit out of the tenants. Or they will have an incentive to withhold properties from the market and drive up the price that way. When neither is feasible, that's when they seek to develop more land. Simple economics, applied to a very real situation.

It surprises me that with America's history of regulating industrial prices and farm prices, we have never attempted to regulate or macro-manage the real estate industry in any significant way. But if I and the classical economists are right, there is a huge market failure in providing land goods on a laissez-faire basis. Perhaps real estate regulatory policies are the wave of the future....

Although the previous comment is entirely off the subject of the original post which seems to have more to do with the inequity of the justice system and this sellers questionable business practices, I thought I would add something that might be helpful to the author.

It is true that real estate agents and Realtors are self regulating. Also, any private party can sell real estate without any training or license. I checked and did not find a license for this guy but noticed in your story that the guys wife is a Realtor and even found her license number on line. Is she legally involved in this situation in any way? The situation is certainly is not within the "Realtor Code of Ethics". Though I generally mistrust self monitoring because more time is spent protecting the profession that dealing with the bad apples, the wife should really be reported to the Oregon Board of Realtors. Even if she can show she is not involved now, once the board is aware of the connection she might have more accountability if some other unethical real estate transaction is reported later.

I want to add that I am sorry you are going through all of this. I read your other posts and was especially sad that you did not get your escrow money to save those dogs. You can tell alot about a person by how they treat animals.

Good luck and God bless you.

Kip Schoning is the red door devil

he steals his money from newby college students at OSU and makes them live in rat infested falling apart basements and houses until they get an attourney, which few ever do.

He scams them for rents, security deposits, and cleaning fees and threatens court all for made up excuses, but never actually does anything to keep the houses he 'buys' habitable.

Avoid the red door, it is the mark of kip

This GDMF is still round? If any current OSU students are reading this- take the time to print it out and post it with the housing listings-you will be doing a service for your fellow students. OMG the places he owned were dumps years ago! The last post is right on. Kip will always remember to collect the rent but never remember to do any repairs, even if he knows the problem is actually damaging his property. Then when you finally move out, he will keep every dollar he got out of you for fees and deposits because the place was perfect when you moved in and you caused all the damage.

I hope the person who wrote the first story here screws him but good!

I do not understand how Schoning gets away with his behavior but I suspect he will not have much reason to change on his own. While I am not out to "screw him over" I do intend to fight until I get everything I am entitled to. So while I am waiting I consider it a public service that I can get the word out, maybe save a few people some stress and grief and even take a few bucks out of Schonings pocket.

Thanks for all the comments! It took me a while to get GDMF, I had to ask my son. This is the 2nd time I have hear the "red door" reference. Is it his office or do the actually houses all have red doors? Please fee free to email me:  aggiemae@quik.com if you want to elaborate or have words you can only share privatly.

I ran across this only because I live in Corvallis and saw the title of the article. I read this article and then found some others you have written as well.
I have noticed that sometimes bad people get away with stuff no matter how hard you work to bring them down, This is not because they are clever. It is because good people never allow themselves to be as hard as they need to be to get the job done. I commend you on your creative approach to your problem and insight. There is so little justice in the world, but I have a feeling that someone with this amount of perseverance will find justice in the end. I will ask around and if I hear anything that will help you I will post again.

Having some familiarity with Kip Schoning's behavior and the hell he has put people like the author through, I thought I'd add a few comments regarding what I've learned from dealing with persons like Kip. Agnes' post should be a terrific warning to anyone thinking of doing business with this man or his toadies, in any capacity, renting, purchasing, or using one of his services. One poster alluded to the psychological makeup of a person like this, and it isn't simply 'bad.' This man is a destructive narcissist, and it's almost impossible to win when engaging with them. They actually believe their own bs, to the extent that it will make them more credible and help them maintain their enormous self-esteem. They've learned how to charm, seem trustworthy, inspire confidence, etc. and then use this to screw people for their own benefit, their entire lives. After doing so, they are pro's at turning around and actually twisting history to make their victims seem like the bad guys. It's not just that good people aren't 'hard' enough, it's that the narcissist spends almost every waking moment perfecting skills in this area, and few normal persons have spent even a small portion of their time trying to deal/dual effectively with them, or they wouldn't have remained sane. I read a book on this by a therapist who said engaging with a particular coworker always left her either nauseated or with a headache, and then she found it was true for her other coworkers. After quite a bit of research on this behavior, she wrote a very insightful text on destructive narcissism. Engaging with these people is a no-win situation. Initially some seem quite likable and charming, as they size up how they might use you--and even very perceptive persons will not see through their facade. Once they have no viable use for you--financially or some way in which you bouy their ego or allow them social advancement--your only purpose for them is as something to be avoided or to compare themselves to to feel superior. They are absolute masters of recreating history. They are quite dangerous and it's important to look for earmarks of their behavior if you are doing business with a new person or getting involved romantically. One earmark is feigned humility while dropping a myriad of accomplishments or possessions. Seeming charming beyond the norm might be another. If you're dealing with one and going crazy, there are some online sites that might help, and googling will provide them.

I'm currently involved with beginning a lawsuit with a dentist who is one of the prototype narcissists, and every tooth in my mouth had to be replaced with crowns, which now cover the almost destroyed miniscule remnants of my teeth. He had provided a 3-page CV on his accomplishments, and was utterly charming when I first saw him, and had every excuse in the book when things started going wrong. The CA deputy attorney general has contacted me as they want to remove his license and I'm about to engage with a 'Kip' of my own. This man, William Nordquist, took his last lawsuit to the state supreme court when he lost, and lost there as well--the second largest settlement ever for a dental malpractice, breach of contract and fraud in the state of CA. (Nordquist v. Kipzig) Narcissists trip themselves up with their incredible hubris (arrogance) and they don't learn much from their errors.

Unfortunately for me, CA does not require malpractice insurance for dentists, and most attorneys I contacted indicated I would need to put up 40K to mount a suit, with little likelihood of any return, as he had dropped insurance and shielded his assets after the large lawsuit. All the local attorneys I contacted had been around the block with complaints against him in the past. (I do have one out of the city who is capable of taking him on and won't require the up front monies.) Despite the mistakes narcissists make due to their lack of realism regarding their behavior, they are really adept at pit fighting, and it is hard to get as dirty as they're willing to go. Luckily, I hope, for Agnes, smart attorneys have seen these people frequently in their practice, so if their shelters aren't completely impervious, they can be toppled--at least occassionally. Unfortunately, they just pick themselves up, bad mouth the victim who triumphed, and start scamming and damaging new victims. Try not to be one, and you already have a red flag on Kip.

I'm not leaving my identity given the possible pending lawsuit. I didn't get attorney approval to post this. While everything I said is true, attorneys are really picky about things when you're engaging in a suit.

Thank you. You articulated the behaviour I've seen so well. You're so spot on as far as my little narcissist girl went. The willingness to go lower than any others, and fight dirtier than others, to sink to depths of low behaviour that would make most people nauseous with self loathing, the willingness to spend every waking hour perfecting the games, the fights, the lies, the tallent for making themself look like the victim. Charming? yes, often. My one was sweet and generous and gave a lot of love. The convincing ability to be sincere. What is the name for such behaviour?

This has inspired me to read up on pathological behaviours so as to protect myself from harmful individuals in the future. I hope there aren't too many out there. Honestly, I've mostly only known nice people in my life.

Alex.

I live in Corvallis and have found that many people in this town have Kip Schoning stories. Note that he is the public figure, rumor has it that he has at least one silent partner. He buys houses on contract for deed that may be inelgible for conventional financing. He delays the payment of property taxes as long as possible. His properties are very often in foreclosure. He often moves ownership from his name to others. The local student population and neighbors of his properties are well aware of his reputation. I would agree that dealing with him on any level should be avoided. I also expect that a compilation of every Kip Schoning story would probably make a good book or film project, assuming anyone could stand to be around the guy for any length of time.

Everyone in Corvallis knows Kip Schoning as a slum lord who steals, lies and is a druggie/alcoholic. He rented a place to my son and his friends--the place didn't even have heat. When they asked about the heater, he said he would install a used one, but would have to raise their rent. Well, these kids were soooo young (barely 18) and could hardly scrape up the current rent. They lived like that for 2 winters.
I'm surprised the place didn't burn down with all the space heaters they had to use.

Wonder if Kip's 'investors' know what he's up to?
Do they know what he's doing to a nice town like Corvallis??

They are the ones I'd like to talk to!

My contact email is  aggiemae@quik.com for anyone that wants to contact me privately. I am not in need of testimony for my case, but I want to know more about some of your complaints, like the address and dates of rental and what happened to your deposits and fees and especially if you took any legal action. When you consider the likelihood of so many people on Indy having been scammed by Schoning it really makes me think that I might not be doing enough by just letting potential renters know. Maybe we could get together as a group and do something legally to stop him.

So far I know of a few potential rents that were warned away from schoning, though one did loose $200.00 "de[posit" even though she decided not to rent from him well before her move in date. During my drawn out litigation I have learned how very busy Kip is and how valuable his time is...JUST KIDDING he is just a greedy bastard!

Also. from my research it does not appear that Schoning has many real long term "investors". His former employees are pretty forthright about how Schoning runs his "businesses" I gather more information every day he keeps me waiting for money that is rightfully MINE. As far as "investors" it seems like mostly he just sticks to scamming his own family and friends. The former employees and even two ex girlfriends have checked in . Any "investors" out there with a story to tell?

Quote from story: " At one point during to arbitration Kip said that the house he sold me was "in pretty good shape compared to the homes he usually purchases". The furnace did not work, the hotwater heater was 18 years old. The appliances in the kitchen were "harvest gold" (vintage 1960"s), The basement flooded when we used the hose in the backyard and the toilet was about to fall through the floor into the basement. I could go on... I purchased the house in March but could not even move in until July. The house was truly UNINHABITABLE and filthy. I could not even get homeowners insurance until the bathroom was repaired and some of the electrical repair was was done."

Having dealt with Kip intimately I can tell you that he has one set of rules for how he expects to be treated and another for how he treats other people. I have not seen Kip in about ten years, yet nothing I read surprised me in the least. He is described here exactly as I remember him. Kip does not think any rules apply to him, all he cares about is winning and I don't think there is a boundary of human decency he would not be willing to cross to get what he wants. I doubt he looses sleep afterwards either.

I hope that you have pictures because Kip will almost certainly lie about the condition the house was in when he first sold it to you. I want you to know that if Kip tells any lie enough times he will actually starts to believe is own lies. He will not have any problem making his case in court as he will really believe that you are out to get him. In Kip's mind, if anyone goes after him, it is because they are after his money or envy his success. I once knew Kip well and want you to be prepared for what might be ahead.

Quote from story: " At one point during to arbitration Kip said that the house he sold me was "in pretty good shape compared to the homes he usually purchases". The furnace did not work, the hotwater heater was 18 years old. The appliances in the kitchen were "harvest gold" (vintage 1960"s), The basement flooded when we used the hose in the backyard and the toilet was about to fall through the floor into the basement. I could go on... I purchased the house in March but could not even move in until July. The house was truly UNINHABITABLE and filthy. I could not even get homeowners insurance until the bathroom was repaired and some of the electrical repair was was done."

Having dealt with Kip intimately I can tell you that he has one set of rules for how he expects to be treated and another for how he treats other people. I have not seen Kip in about ten years, yet nothing I read surprised me in the least. He is described here exactly as I remember him. Kip does not think any rules apply to him, all he cares about is winning and I don't think there is a boundary of human decency he would not be willing to cross to get what he wants. I doubt he looses sleep afterwards either.

I hope that you have pictures because Kip will almost certainly lie about the condition the house was in when he first sold it to you. I want you to know that if Kip tells any lie enough times he will actually starts to believe is own lies. He will not have any problem making his case in court as he will really believe that you are out to get him. In Kip's mind, if anyone goes after him, it is because they are after his money or envy his success. I once knew Kip well and want you to be prepared for what might be ahead.

Wow! I have had several people from Kip's past write to me privately. What they told me is pretty much along the same lines as your story and like yours all the relationships ended badly. Not one of the others was as thought provoking as yours. As time goes by I sometimes forget the extreme stress he caused me and the physical and emotional toll the whole episode took as it dragged on month after month.

It has been almost two months since the mediation and though the arbitrator said it would be less than two weeks until the decision, we are still waiting. I guess in the scheme of things this wait is still short in comparison. In two weeks it will be two full YEARS since I got the notice that my home was in foreclosure. Justice has not exactly been swift!

To answer the question, yes I do have pictures, thought I ever imagined they would be used for anything but to document the renovation of the house.
Since I have had two years I have also collected lots of other interesting and probably useful information. I really stepped up my research after the mediation. It is always good to get an opportunity to observe our opponent.

Thank you for you most candid post. Please check back in again.

Please note new email address!

I saw this default in the Corvallis paper today. I read this a while back and it does sound like defaulting is not an unusual even for Mr Schoning.

TRUSTEE'S NOTICE OF SALE 2973357 Loan No: 66170114109327 SCHONING/1215 TS #: 09929OR Pursuant to O.R.S. 86.705, et seq. and O.R.S. 79-5010, et seq. Reference is made to that certain Trust Deed made by KIP S. SCHONING, as Grantor, to KEY TITLE CO., as Trustee, in favor of BENEFICIAL OREGON INC DBA BENEFICIAL MORTGAGE CO., as Beneficiary, dated 10/14/98, recorded 10/15/98, in the mortgage records of BENTON County, Oregon, book/reel/volume No. , Page and/or as fee / file / instrument /microfilm/ reception No. M-254893-98, and Re-recorded on 10-27-1998, Book, Page, Instrument M-255393-98. The beneficial interest under said Trust Deed and the Obligations secured thereby are presently held by BENEFICIAL OREGON INC DBA BENEFICIAL MORTGAGE CO. Said Trust Deed encumbers the following described real property situated in said county and state, to-wit: The West 25 Feet of Even Width of Lot 1 and the West 25 Feet of Even Width of the South 12 Feet of Lot 7, Block 12, Wilkins' Addition to Corvallis, Benton County, Oregon. APN 120091 One Note and Also Secured by a Deed of Trust Recorded on 10-15-1998 Volume 981 Page 11 in Linn County, State of Oregon. The street address or other common designation, if any, of the real property described above is purported to be: PARCEL NO.: 120091, 1215 N.W. VAN BUREN AVE., CORVALLIS, OR 97330. The undersigned Trustee disclaims any liability for any incorrectness of the above street address or other common designation. Both the beneficiary and the trustee have elected to sell the said real property to satisfy the obligations secured by said Trust Deed and a Notice of Default has been recorded pursuant to Oregon Revised Statutes 86.735 (3); the default for which the foreclosure is made is Grantor's failure to pay when due, the following sums below; together with foreclosure fees and cost incurred herein by reason of said default; any further sums advanced by the beneficiary for the protection of the above described real property: From 03-15-2006 Through 05-11-2006 Interest Rate 11.250 No. of Payments 2 Amount: $1,217.77 Total Advances: $1,303.66 Late Charges: $0.00 Total: $3,739.20. ALSO if you have failed to pay taxes on the property, provide insurance on the property or pay other senior liens or encumbrances as required in the note and Deed of Trust, the beneficiary may insist that you do so in order to reinstate your account in good standing. The beneficiary may require as a condition to reinstatement that you provide reliable written evidence that you have paid all senior liens or encumbrances, property taxes, and hazard insurance premiums. These requirements for reinstatement should be confirmed by contacting the Beneficiary or the undersigned Trustee. Reinstatement monies may be tendered to: BENEFICIAL OREGON INC D/B/A BENEFICIAL MORTGAGE CO., ATTN: DAWN BRYANT, 961 WEIGEL DRIVE, ELMHURST, IL 60126, 800 958-2418 EXT 6868. By reason of said default, the beneficiary has declared all sums owing on the obligation secured by said Trust Deed immediately due and payable, said sums being the following: Principal Balance: $121,846.58. In addition to said principal, interest at the rate provided in the Note or other instrument secured, shall be payable from 02-15-2006 at 11.25%, late charges as well as all Trustee's fees and foreclosure costs, Attorney's fees and costs, and advances arising from the Beneficiary's protection of its security and preservation of the property may accrue after the date of this notice. Wherefore, notice is hereby given that the undersigned trustee will, on September 26, 2006, at the hour of 10:00 AM in accord with the standard of time established by O.R.S. 187.110; AT THE FRONT ENTRANCE OF THE BENTON COUNTY COURTHOUSE, 120 N.W. 4TH STREET, CORVALLIS, OR, sell at public auction to the highest bidder for cash, the interest in the said described real property which the Grantor has or had power to convey at the time of execution by him of the said Trust Deed, together with any interest which the Grantor his successors in interest acquired after the execution of said Trust Deed, to satisfy the foregoing obligations thereby secured and the costs and expenses of sale, including the compensations of the Trustee as provided by law, and the reasonable fees of the Trustee's Attorney. Notice is further given that any person named in O.R.S. 86.753 has the right, at any time prior to five days before the date last set for the sale, to have this foreclosure proceeding dismissed and the Trust Deed reinstated by payment to the beneficiary of the entire amount then due (other than such portion of the principal as would not then be due had no default occurred) and by curing any other default complained of herein that is capable of being cured by tendering the performance required under the obligation or to cure the default, by paying all costs and expenses actually incurred by the Beneficiary and Trustee in enforcing the obligation and Trust Deed, together with trustee's and attorney's fees not exceeding the amounts provided by said O.R.S. 86.753. In construing this notice, the masculine gender includes the feminine and the neuter, the singular includes plural, the word "Grantor" includes any successor in interest to the Grantor as well as any other person owing an obligation, the performance of which is secured by said Trust Deed, and the words "trustee" and "beneficiary" include their respective successors in interest, if any. This is an attempt to collect a debt and any information obtained will be used for that purpose. For Trustee Sale Information, please call: 530-672-3033. DATED: 05/11/06 First American Title Insurance Company, as Trustee, Address for Trustee: First American Title Insurance Company, c/o Meridian Trust Deed Service, 4675 MacArthur Court Suite 1520, Newport Beach, CA 92660, 949-477-5830, DENNIS CANLAS, Assistant Secretary. NPP 0118950 #2386922PUBLISH: 08/ 01, 08/ 08, 08/ 15, 08/22/06

Thanks so much! Any future notices would be appreciated, I live in Marion county so don't always get the Corvallis news. So far Schoning has not responded to the mediators judgement or my attorney and so it looks like we are hearing for court! A jury trial should be interesting...

New email addres:  aggiemae@msn.com for those of you who want to contact me off line.

The mediator seems to have forgotten to include my escrow money (over $5,000.) into the settlement and did not itemize the award. I guess I prevailed, meaning I am right but I would really just like to have the money I have actually lost and the money I continue to loose back and be done with this, so I am not feeling victorious. Per my attorney Schoning did not respond to adjusting the settlement, so it looks like we are heading for a jury trial.

It is now OVER TWO YEARS since Schoning's default. I have to ask, why are things allowed to continue like this with no justice for the person who was clearly wronged? It seems to me that the court system seems to favor this sort of person. I wonder how a jury will view this mess.

I will post a "new" updated story in a few weeks.

Our settlement hearing is scheduled for Thursday, November 30th at 2 pm 5th floor Marion County Court House.

Anyone who wants to watch the show is welcome to come.

We all need to stand up for our rights! I was told during a court mediation that I should settle for $6,000.00 on a $150,000.00 peice of property (that I was 1/3 owner of) while the two attorneys involved (I did not have an attorney)got $10,000.00 each for one year of postponing the trial to run up the attorney fees. I refused to let someone come in and do that to me!!!
They have both been turned over to the OR State Bar for misconduct, and the judge at the time to the judicial disipline committee for going along with them (he recused himself) and this case is now going before the Supreme Court...(Still don't have an attorney).

Oregon has rules of civil procedure (ORCP) and ORS (Oregon revised statutes) governs the laws associated with those rules....I urge all of you (with or without an attorney) do your home work. Turn these crooks over to the proper athorities. Contact the Oregon State Bar, your Governor, the Justice Department, and the FBI if you have to. Just don't sit there and do nothing! We can all do better if we would just get involved and stop the wrong doing of innocent people.

Now if you have this happening to you....Do your homework.

Search your search engine (google, msn, etc.) for your problem, listing ORs as a part of the search and you might be surprised what Court of Appeals cases come up!

Now get off the couch and protect yourself and your property. Report the the people that did you wrong to the proper athorities. Get their license suspened if you need to...All they can do is review it and say it didn't happen!

Oregon State Bar
Oregon Department of Justice
Oregon Judicial Discipline committee

Write them! The US consitution still says we have a right to our property.
5th and 14th Amendments.

Good luck and KICK SOME ARS!

Well... what was the end result? I am dying to know if he had to pay you the $5,000 and expenses.