Sunday, June 20, 2010

Cal. AG Warns Underwater Homeowners Against Emergence Of An Entire Industry Of So-Called Short Sale Negotiators; Calls It A Field Rife w/ Scam Artists

From the Office of the California Attorney General:
  • Attorney General Edmund G. Brown Jr. [] joined the California Department of Real Estate and the State Bar of California to warn homeowners about an alarming rise in short sale fraud across California in a field "rife with scam artists". A short sale is an arrangement in which a homeowner sells his or her home for less than the outstanding mortgage, with the consent of the lender.

  • "While short sales can provide homeowners with a last-ditch alternative to foreclosure, this market is rife with scam artists," Brown said. "Homeowners and buyers, agents, and lenders should beware of short sale negotiators who operate without licenses, use straw buyers or charge illegal fees."

  • With so many homeowners now considering short sales, an entire industry of so-called short sale negotiators has emerged. These individuals solicit homeowners by promising to expedite the process and help coax lenders into taking part in the transaction. The Department of Real Estate is investigating more than 40 complaints of short sale fraud, up from "virtually zero" cases only three months ago, a spokesman said.

For the California AG press release, see Brown Issues Warning about Rise of Short Sale Fraud.