NEW APPRAISALS RULES FROM CFPB EFFECTIVE IN JANUARY 2013
Mortgage lenders are to provide home loan applicants with copies of written appraisals and other home value estimates and ensure that consumers receive information prior to closing about how the property’s value was determined.
Creditors are to inform consumers within three days of applying for a loan of their right to receive a free copy of the appraisal reports and home value estimates. Creditors must furnish the reports as promptly as possible, but in no case later than three days before closing. The rule applies to all loans, regardless of whether credit is extended, denied, incomplete or withdrawn.
Creditors could still charge reasonable fees associated with conducting appraisals and home value estimates; however, the rule would prohibit creditors from charging consumers fees for obtaining the reports.
1. Limit the requirement to applications for credit to be secured by a first lien on a dwelling.
2. Require that creditors notify applicants within three business days of receiving an application of their right to receive a copy of written appraisals and valuations developed in connection with their application.
3. Require creditors provide applicants a copy of all written appraisals and valuations promptly after receiving them, but in no case later than three business days prior to closing on the mortgage.
4. Permit applicants to waive the timing requirement to receive copies three days prior to consummation, provided a copy of all written appraisals and valuations is provided at or prior to closing.
5. Prohibit creditors from charging additional fees for providing a copy of written appraisals and valuations, but permit creditors to charge applicants a reasonable fee to reimburse the creditor for the cost of the appraisal or valuation unless otherwise provided by law. (alrgs101512bkrsadvinc)
Seems repetitive to me since most states require the consumer get a copy anyway. But watch out for the fact that you have to give the consumer the report even if loan denied or withdrawn.
ARIZONA AG ENTERS INTO CONSENT CIVIL JUDGMENT WITH DEFENDANT WHO CLAIMED THE MONEY WAS “CHURCH DONATIONS” AND NOT FOR LOAN MODS
On Oct. 18, Arizona Attorney General Tom Horne obtained a consent judgment against Rosa Galope in a consumer fraud lawsuit in which the state alleged that Galope engaged in a scheme designed to defraud homeowners looking for assistance in obtaining mortgage loan modifications and forestalling foreclosure on their homes.
Horne alleged Galope charged distressed homeowners thousands of dollars in advance fees for her services. When she was unable to obtain results, she refused to refund the money, claiming the payment was a donation to her church, Nation to Nation Ministries. The state also alleged that Galope instructed her clients to not communicate with their lenders and to send their mortgage payments to her so that she could forward them to the consumer’s mortgage lender, while keeping the money for her own use.
The terms of the judgment require Galope to pay full restitution of nearly $65,000 to consumers who filed a complaint with the Attorney General’s Office. Galope was also ordered to pay $10,000 in civil penalties and is prohibited from engaging in any loan modification activities in Arizona or on behalf of Arizona consumers. In entering into the consent judgment Galope did not admit that she violated the law nor did the court make findings that she did so. (azag101812prsrel)
I would say she had a very good attorney. There is no admission of law violation and no findings by the court of any violations.
CALIFORNIA MAY LET YOU HAVE YOUR REAL ESTATE LICENSE FOREVER?
A decision by the Department of Real Estate to delay renewal of a real estate license tolls its expiration until any disciplinary actions pending against the licensee are final or the licensee voluntarily surrenders his, her or its license, whichever is earlier. (B&PC10186.2-1/1/12)
So if your license is set to expire and the DRE files an accusation the license stays active until the hearing is completed—say 10 years from now?
CALIFORNIA SELLER REFUSES TO RELEASE BUYER’S ESCROW FUNDS AND WINDS PAYING BUYER THREE TIMES AS MUCH AFTER TRIAL
Plaintiff entered into an agreement with defendants for the purchase of real property in Riverside County, Calif. An escrow was opened with Arch Escrow and plaintiff Golden State Holding LLC deposited $50,000. Golden State later gave notice of cancellation of the transaction. The sellers’ took the position that the notice was untimely and refused to release the escrow deposit. Golden State sued.
The Riverside Superior Court judge said Golden State gets its money back. Golden State’s cancellation notice was timely. The escrow deposit was ordered released to Golden State. Because the escrow agreement contained an attorney fee clause Golden State filed a motion for the fees and was awarded $101,886 in attorney fees and $1,223 in costs. (Golden State Holdings, LLC v. Arch Escrow/BC382009)
Either the defendants did not think the plaintiff would spend the money to get the deposit back or they thought they were right. Now it costs them the deposit plus over $100,000 in attorney fees they had to play plaintiff. So do not gamble. If the cancellation is correct, give it up or get sued.