WINTER SPRINGS, Fla — Would-be homebuyers looking to get a great deal claim an online auction site is collecting large deposits then holding the money for months even after the company promised a refund.
“A lot of people are very frustrated,” said Brij Gakhar of Winter Springs.
The website Federa.com claims to handle online auctions, many of them on foreclosure properties. To bid you have put deposits down. Often the required deposits are $10,000 or more.
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The company promises money back within 30 days if you don’t win the auction. Brij Gakhar told Action 9 it took more than four months and he’s not alone. There are many similar complaints online.
If you scroll the website, you’ll see there is no shortage of listings for homes up for auction.
Gakhar said, “We were looking for a home for my son, and so we said, ‘You know, if we can get a good deal why not?’”
He found the website after looking at homes on Zillow. Gakhar paid a $10,000 deposit while looking to bid on two homes in Winter Springs and one in Vero Beach, but his bids were not successful.
“So, that put a lot of doubts in my mind, and that’s when I asked for the refund,” Gakhar said.
He claims Federa promised a refund within 30 days of requesting it, but that didn’t happen. Months went by without a refund. He said during call after call, Federa kept making excuses. Action 9 saw lots of reviews on social media and on the Better Business Bureau website from consumers complaining about not getting their money back.
One consumer wrote, “Do not invest with this company. The chances of getting back your deposits back are extremely slim.”
The company is ‘F’ rated by the BBB for unresolved complaints. Many complaints we saw online were related to refunds.
When Action 9 Consumer Investigator Jeff Deal asked about refunds on the website chat, the company wrote, “Refunds can be processed in a couple of days but can take up to 30 days per policy depending on banks and compliance review.”
Brij Gakhar said, “They tell you you’ll have your money in 30 days, and here we are more than four months later, and it’s still the same excuses.”
If you’re looking to bid on foreclosure properties, in Florida you can find the listings on your local the clerk of courts website and don’t need to pay a third-party company to get involved.
Orlando real estate attorney Barry Miller said, “You can bid yourself. There’s no more in-person bidding, it’s all done online.”
Miller recommends watching the tutorial on the clerk’s site before bidding, but also keep in mind, buying a foreclosure property doesn’t necessarily mean you own it outright. Paying for a title search first will let you know if there are other claims on the property.
“When you buy that property, people think that they own it free and clear. They don’t. It is still subject to the first and possibly the second mortgage,” Miller said.
Fortunately, Brij Gakhar did get his money back from Federa about a week after Action 9 interviewed him. Still, he said it was a frustrating process. He hopes other people will get their money back, too and would like to see state or federal investigators look at how Federa is doing business.
“They make it really easy to take your money, but just extremely difficult to get your money back,” Gakhar said.
Action 9 reached out to Federa to ask about the delay in Gakhar’s refund and about the similar complaints we saw online. So far, we haven’t heard back.
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