CALIFORNIA WARNS ABOUT SHORT-SALE SCAMS

Attorney General Jerry Brown is warning homeowner’s to be wary of scam artists offering to short cut the system or promising results that are not reflective of a true short sale.  His office offers the following tips: 1)  With limited exceptions, only licensed real estate agents or attorneys can engage in short-sale negotiations with a homeowner’s lender.  2)  Licensed agents seeking upfront fees from homeowners for short sales must first submit an advance fee contract to the Department of Real Estate and receive a no-objection letter.  3)  Surcharges and hidden fees just to place an offer on a home are illegal.  4)  Misrepresenting the market value of a property to a homeowner’s lender by only submitting offers on the property from affiliated straw buyers is illegal.  Most short sale transactions are handled by Realtor’s directly with no upfront fee, and negotiated directly with the lender by the agent, escrow, or a short sale intermediary hired by the agent.

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