My Real Estate Blog

DRE, state attorney general issue short-sale fraud warning

California Attorney General Edmund G. Brown Jr., the California DRE, and the State Bar of California recently issued a warning to homeowners about the sudden and steep increase in short-sale fraud statewide.

In the warning, homeowners, home buyers, real estate agents, and lenders were made aware of red flags that may appear when working with or paying a short-sale negotiator, including: A negotiator working without a license; charging up-front fees without prior written permission from the DRE to do so; adding surcharges and hidden fees to place an offer on a home; and misrepresenting current market conditions and only submitting offers on the property from an affiliated straw buyer.

Short sale negotiators and agents may use a variety of titles including: Debt negotiator, debt resolution expert, loss mitigation practitioner, foreclosure rescue negotiator, short sale processor, short sale coordinator, and short sale expeditor.

Homeowners wishing to file complaints related to short-sale fraud can do so by calling the attorney general’s office at (800) 952-5225 or filing a complaint online at www.ag.ca.gov/consumers/general.php. To file a complaint against a lawyer, a legal specialist, or a company purporting to operate as a law firm with the California State Bar, homeowners should call (800) 843-9053 or visit www.calbar.ca.gov.

Reprinted From C.A.R.