I was just forwarded an email from one of the Top Real Estate attorneys here in Georgia that says they will no longer be processing short sales because it is now illegal for them or the agents to do so without a loan originator license! See copied email below. Has anyone else heard about this? The last I heard we had won this battle and it is legal. I don't know what to make of this. :-(
We have just been informed that the Georgia Department of Banking and Finance’s current interpretation of the law is that law firms may no longer provide short sale assistance to sellers. The Department is taking the position that law firms cannot do this work without being licensed as a mortgage loan originator. We, nor any other law firm, are so licensed.
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In WA and OR you need a debt management license IF you are doing SS for a FEE other than just commission. If you are only taking a standard commission then no add'l license is required. Agents can do shorts "in the regular course of real estate business" but cannot market as having the ability to stop a foreclosure.
Thank you all for taking the time to report your findings.
That's very strange! Here's a link to the Kentucky Association of Realtors http://www.kar.com/site/legal-affairs/mars.html, which contains a link to the FTC site http://www.ftc.gov/opa/2011/07/mars.shtm, both of which confirm that, with almost no restriction, real estate agents can represent sellers in short sales. This MARS battle was hard fought by the NAR which did a great job on our behalf. In Kentucky there is no doubt that we are able to assist sellers in obtaining short sales. The prohibition against assisting with other types of mortgage issues, such as loan modifications etc, is still prohibited for real estate agents. I would be very surprised if the information you've received is correct. I'll be following the comments on this topic with interest......
And per Rod with Georgia Department of Banking, Attorney's CAN negotiate short sales or any other financial matter on behalf of their CLIENTS. They must have a client relationship with the Seller in order to do so, but they can do it.
Georgia - I just got off the phone with Rod at the Georgia Department of Banking (he asked that I NOT put his last name or contact info. on here as he has been FLOODED with calls over that email), and he confirmed:
"Agents CAN process short sales, but can not "negotiate", no special license or anything required."
There is NO new legislation and nothing stopping an agent, or attorney, from processing short sales.
He also confirmed that email that went, as stated before, the ENTIRE thing was inaccurate and incorrect and that it has caused a HUGE stir for his office (he wasn't too crazy about it).
If you would like to contact him directly with questions, email me at Ben@ShortSaleShop.net and I will tell you his last name and phone number (again, I would respectfully request you NOT post it here so he does not get flooded with calls).
I also spoke to the people at the attorney's office and I too was under the impression they just want out of short sales so they need not expose themselves to any liability.....again, just my best guess!!!
Keep kicking butt guys, you need help, CONTACT ME!!!!
Maryland - as of July agents CAN process short sales....no worries and no credit license is required
And to confirm what Paul Antonelli said below, yes, Maryland has been CRAZY as well. A well known agent who we work with who was on our cruise recently had to cancel his short sale website, as he swears he basically can't do short sales anymore!! Again, that is in Maryland.
I want CASE LAW. Legal opinions quiet frankly are worthless in my opinion. Show me a State where they have definitely deemed it illegal through action. Another attorney's opinion about this matter has ZERO value. We have been hearing this garbage for years, especially in Georgia.
The Georgia Residential Mortgage Act, Article 13, pertains to the licensing of Mortgage Lenders, Mortgage Brokers and Mortgage Loan Originators. It specifically addresses "exemption for certain persons and entities; registration requirements" for the facilitation of short sale transactions.
Licensed Realtors ARE allowed to do so, as long as they do not receive "a separate fee" for doing so. Attorneys are not, and it appears most other persons other than a loan officer or the homeowner themselves are prevented from doing so in the state of Georgia.
The GRMA can be found at: http://dbf.georgia.gov/mortgage-laws-and-rules
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