Legal Hotline

As reported in the May 3, 2011 Wall Street Journal; the SC Supreme Court halts judicial foreclosures reminiscent of the 2009 SC Supreme Court ordered judicial foreclosure moratorium designed to help solve the foreclosure crisis.

To learn more about the MARS rule and avoiding mortgage scams, read the FTC’s Mortgage Assistance Relief Scams: Another Potential Stress for Homeowners in Distress. You also can watch Real People. Real Stories, a 3 ½ minute video about foreclosure rescue scams.

The Federal Trade Commission (“FTC”) has issued a final rule that may impact real estate professionals who represent clients involved in a short sale transaction. Depending on certain factors, the rules may require real estate professionals to make certain disclosures to consumers if they negotiate a short sale with a lender, advertise short sales experience, or take upfront fees from short sale sellers. The MARS rules took full effect on January 31, 2011- click here to view the MARS rule.

If you are dealing with a transaction involving seller financing, recommend that the parties hire their own attorneys. The ethical answer for REALTORS® remains "You should discuss seller financing issues with your attorney and hire your attorney to implement the legal documents necessary to create and secure your loan. Foreclosure will require hiring an attorney and going to court." Sellers should use due diligence and have reserves to handle these issues.

Sellers who provide owner financing to buyers should consult their attorney about SC mortgage lender licensing requirements and the federal SAFE Act. Due to excesses and criminal acts by some mortgage lenders that led to the mortgage crisis, licensing and background checks were made more strict to prevent these problems from occurring as easily in the future. While SC license law provides exemptions from mortgage lender licensing for owner financing, sellers who engage in multiple owner financing transactions may fall under licensing and federal lending laws.

Checklist of deductions Here's a checklist of common expenses for real estate agents and brokers that you can use to make sure you don't miss any deductions this year:

When Do I Explain Agency and Provide Agency Brochure to Potential Buyers and Sellers?

Answer:  First practical opportunity when you have substantive contact.

Minimizing Risk, Risk Management:  Carry copies of the agency disclosure forms with you and hand them out like candy.  Also, email copies to your contacts in a similar manner.  Provide an explanation too.

SCR recommends that listing agents always make written seller disclosure a requirement for taking the listing.

In 2009, there was great SC Appeals Court case that sets precedent:  real estate agents cannot be sued by buyers for property condition if there was a seller disclosure RPCDS and the real estate agents were not aware of any misrepresentations.  Also, the real estate agents did not make any representations.  Please see attached.

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