bnorton
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Re:"MD Judge Orders Investor to Pay $510,968..." - 2007/02/12 04:01
PassingThru wrote:
The part that is not going to be overlooked or diminished is where the investor does not have a notarized consulting agreement or purchase contract directly between the investor and the seller
PassingThru,
A purchaser cannot have a foreclosure consulting agreement with the seller, because the foreclosure consultant is prohibited from acquiring an interest in the property. Some investors have been taught that the buyer is a foreclosure consultant. In fact, I know for a fact that some of the people teaching this dangerous concept have been told by consumer law attorneys this opinion is wrong, and yet they still teach it.
Some have even been taught that the buyer must have both a foreclosure consulting agreement and a purchase contract with the seller. This is a very dangerous position that will get the investor in trouble. However, it will not be a problem for long. The trend with the title insurance companies is either to choose not to close any residence in foreclosure, or to have the buyer and foreclosure consultant sign an affitavit stating the two parties are unrelated, and have no interest in any of the entities of the other. So in the future, if there is any relationship between the buyer and the foreclosure consultant, or if the buyer and foreclosure consultant are the same, the deal will not close.
Luckily, my students and I have been on the right side of this thing all along. In fact, we recently had a deal that took less than a week to close. The reason it went so fast and easy was because of the fact that I had really good attorneys draw up the documents we use. In those documents it is clear that there is no relationship between the foreclosure consultant and the buyer. In fact, we were not even required to sign the affidavit.
My recommendation to you is that when you hear someone say something regarding this law, that you have it evaluated by an attorney. There is a lot of bad information out there. Make sure you are on the right side of the law.
You are correct that the defending Realtor(r) in the case we have been discussing broke many aspects of the law. The problem is the fact that the defending Realtor(r) stepped outside the scope of his license, the investor did not comply with the law, and the relationship between the defending Realtor(r) and the investor. Had the defending Realtor(r) not stepped outside the scope of his license, or had the relationship with the investor, a foreclosure consulting contract would not have been necessary. The defending Realtor(r) would have been compliant with a listing agreement and if necessary a dual agency disclosure. The crazy thing about this situation is the fact that there was no malice involved - only ignorance.
Bruce..
Post edited by: bnorton, at: 2007/02/12 05:06
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