Governor Brown – VETO SB469

On Friday morning, September 30, 2011, several representatives from our community held a press conference asking Governor Jerry Brown to VETO SB 469 (Vargas). This bill is another in the long line of attacks by California on both businesses and municipalities in our state. It is just one example of why California finds itself 49th out of 50 states for having a business friendly environment. It’s why we’re losing 5.4 companies every week to places like Texas and Colorado and North Carolina and Nevada. It’s another example of that political-think that says Sacramento can make better decisions for our local cities than they can themselves – keeping in mind that Sacramento is deeply in debt, can’t pass a budget, is divisively gridlocked and stocked with career politicians who have never held a real job. Yet they feel perfectly content to try to dictate to the rest of us how we should comport ourselves.

This morning I joined the Mayor of Murrieta, Randon Lane, Wildomar Mayor Pro-Tem Ben Benoit, Menifee City Council member Darcy Kuenzi, Lake Elsinore Finance Director Allan Baldwin and League of Cities rep Dave Willmon in providing our statements to the assembled press. Here is my statement:

Good morning. My name is Gene Wunderlich and I’m Chair of the Southwest California Legislative Council, a coalition of businesses and Chambers representing more than 3,000 small, medium and large businesses in Southwest Riverside County.

Communities throughout our state are facing crisis. In Riverside County our unemployment rate is 14.7%, statewide it is 12.1%, and that’s only the people they count. Like many other cities and counties across California, we each face problems that are similar in nature, yet unique to each locality. We must be able to make decisions that are best for our communities, our families and our friends.

Our elected leaders in Sacramento don’t seem to know what’s going on in Temecula, or Wildomar, or Menifee or communities across Southwest Riverside County. SB469 is a perfect example of that with its bureaucratic roadblocks and overreaching state authority. It’s a one=size-fits-all bill and it will not help us create jobs in our community – although it may well keep several attorneys busy for years.

This bill takes away the power of a community to build and define itself and gives that power to the state, having local land use issues defined in Sacramento. The state SHOULD NOT be imposing more regulations on local governments right now. The state SHOULD NOT be telling us what kinds of businesses we can and cannot approve and the state SHOULD NOT be interfering in our ability to help reduce the high unemployment rate in our own community.

We are asking Governor Brown to help Southwest Riverside County and cities and counties across the state. Join us in helping create new jobs, not destroy more jobs.

VETO SB469.

This bill is also opposed by the California Association of Realtors® and dozens of other pro-jobs, pro-business & pro-local rights groups throughout the state.


CA Attorney General files suit in massive 17 state mortgage fraud scheme.

CA State Attorney General Kamala Harris sued Philip Kramer, the Law Offices of Kramer & Kaslow, two other law firms, three other lawyers, and 14 other defendants who are accused of working together to defraud homeowners across the country through the deceptive marketing of “mass joinder” lawsuits. Prominent foreclosure attorneys Phillip Kramer and Mitchell Stein and at least 17 others have been accused of luring desperate homeowners into the scheme using deceptive advertising and telemarketing schemes aimed at millions of people in California and 16 other states.

The scheme claimed that courts have found that most mortgage lenders engaged in predatory lending practices or approved inappropriate loans (well, that part is certainly true), and that the homeowners bank was one of the guilty. As alleged in the lawsuit, defendants preyed on desperate homeowners facing foreclosure by selling them participation as plaintiffs in mass joinder lawsuits against mortgage lenders. Defendants deceptively led homeowners to believe that by joining these lawsuits, they would stop pending foreclosures, reduce their loan balances or interest rates, obtain money damages, and even receive title to their homes free and clear of their existing mortgage. Defendants charged homeowners retainer fees of up to $10,000 to join as plaintiffs to a mass joinder lawsuit against their lender or loan servicer.

It probably comes as no surprise that theses same ‘prominent foreclosure attorneys’ had previously been ‘prominent loan modification specialists’ but it is alleged that Kramer sent an email to another fellow defendant last year stating “Only morons would prefer to ‘sell’ mods from this day forward”.
Homeowners who have paid to be added to one of the lawsuits should contact the State Bar if they feel they may be victims of this scam. They can also contact a HUD-certified housing counselor for general mortgage related assistance. If you have sent money to any of the following seized entities, you should contact the CA Attorney Generals Office at http://oag.ca.gov/.

The Department of Justice has seized the practices of the following non-attorney defendants: Attorneys Processing Center, LLC; Data Management, LLC; Gary DiGirolamo; Bill Stephenson; Mitigation Professionals, LLC; Glen Reneau; Pate Marier & Associates, Inc.; James Pate; Ryan Marier; Home Retention Division; Michael Tapia; Lewis Marketing Corp.; Clarence Butt; and Thomas Phanco as well as seizing the practices and accounts of attorney defendants:The Law Offices of Kramer & Kaslow; Philip Kramer, Esq; Mitchell J. Stein & Associates; Mitchell Stein, Esq.; Christopher Van Son, Esq.; Mesa Law Group Corp.; and Paul Petersen, Esq.

Attorney General Harris is challenging the defendants’ alleged misconduct in marketing their mass joinder lawsuits; her office takes no position as to the legal merits of any claims asserted in the mass joinder lawsuits filed by defendants.

Victims in the following states are known to have received these mailers, or signed on to join the case. This is a preliminary list that may be updated:

Alaska, Arizona, California, Colorado, Connecticut, Florida, Hawaii, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Jersey, New York, Ohio, Texas, Washington.

For more information please go to: http://oag.ca.gov/news/press_release?id=2552


NAR: New FTC Rules May Impact Brokerages

New FTC Rule May Impact Brokerages

The Federal Trade Commission (“FTC”) has recently issued its Mortgage Acts and Practices – Advertising, or “MAP”, rule (“Rule”). The Rule imposes requirements on those that provide information about mortgage credit products to consumers by prohibiting misrepresentations during these communications and also imposing recordkeeping requirements. The Rule will impact real estate professionals that provide this information to consumers, such as giving a consumer a lender’s rate sheet. The Rule takes effect on August 19, 2011.

Click here to read the Rule’s text and accompanying commentary.

Background

The FTC published an Advance Notice of Proposed Rulemaking in 2009, and issued a proposed rule relating to unfair or deceptive acts and practices that may occur with regard to mortgage advertising in September 2010. NAR filed a comment letter seeking an exemption for real estate professionals from the Rule- click here to read NAR’s comment letter.

The Rule is intended to regulate unfair or deceptive practices in the advertising of mortgage products, and covers all entities involved in the process such as mortgage brokers, lenders, and home builders. The Rule will also cover real estate professionals when they are providing information about a mortgage credit product to a consumer, as outlined in this article.

Rulemaking authority for the Rule has now transferred to the Consumer Financial Protect Bureau (“CFPB”). Enforcement authority for the Rule rests with the CFPB, FTC, and state attorneys general.

Rule’s Requirements

The Rule prohibits misrepresentations in a commercial communication about any term of a mortgage credit product. A “commercial communication” is broadly defined within the Rule, covering both oral and written statements designed to “create an interest in purchasing goods or services”, which in this case would be a mortgage credit product. A “mortgage credit product” is “any form of credit” that is offered to a consumer and secured by the consumer’s dwelling. The Rule’s coverage will include information about all mortgage terms and the Rule contains an extensive list of possible mortgage terms, including interest rates, products sold in conjunction with a mortgage such as credit insurance, amount of taxes, variability of interest rates, and prepayment penalties.

Application of Rule to Real Estate Professionals

The Rule will apply when a real estate professional provides information about a specific mortgage product to a consumer. An example would be providing a consumer with rate sheets containing the current interest rate from a lender or providing a consumer with applications or other information for a specific mortgage product. All statements about the terms of a mortgage will be covered by the Rule, and will need to be retained for two years. In addition, the statements should have the disclaimer language discussed in this article in order to protect against later misrepresentation claims.

The FTC has stated in its comments that the Rule does not apply to purely informational communications not designed to cause the purchase of a good or service because these are not commercial communications. So, providing a consumer general information about market rates for different types of mortgages products will likely not be subject to the Rule because these are not related to a specific mortgage product. However, providing a consumer with the daily rates from a specific lender would trigger compliance with the rule. Similarly, going through the prequalification process with a consumer in order to determine the range of properties that a consumer may be eligible to purchase won’t require compliance with the Rule; however, providing a consumer with the documentation needed to apply for a preapproval from a lender for a mortgage loan will be covered by the Rule.

Disclaimer or Qualifying Statement

In the preamble to the final Rule, the FTC notes that a disclaimer provided with a covered statement “may correct a misleading impression, but only if it is sufficiently clear and prominent to convey the qualifying information effectively”. Therefore, real estate professionals should always include a disclaimer when providing information to consumers about the terms of a mortgage credit product, as a properly crafted disclaimer can protect against later misrepresentation claims.

The disclaimer will need to be prominent, as the FTC notes in its comments that disclaimers in small type placed at the bottom of a document will not protect against misrepresentation claims. The disclaimer text should be separated from the other text in the covered statement, as language buried within the text may not be effective to protect against misrepresentation claims. Click here for a model disclaimer.

Note that the disclaimer should be tailored to the type of information that you are providing to a client. If you are providing other services beyond transmitting basic mortgage information, you will need to tailor your disclaimer to cover those services.

Recordkeeping Requirements

If a real estate professional is subject to the Rule, the real estate professional is required to keep all covered commercial communications for 2 years from the date that the communication was made to the consumer. In order to comply with this section, the real estate professional should put all covered statements into writing and include the statements in each consumer’s file (paper or electronic) with the brokerage. This record retention system should become part of the brokerage’s overall record retention program.


Pay no attention to that man behind the curtain.

The California Democratic Party is at it again – and they’re counting on you being too stupid to notice.

Dan Walters, Political Columnists for the Sacramento Bee, recently wrote about the slew of Democratic legislation aimed at eviscerating the initiative process in our state. You know, the initiative process – whereby ordinary citizens have the opportunity to get measures on the ballot that legislators don’t like? Yeah, that process. Democrats complain that ‘the initiative process is being abused’ and they want to protect us from ourselves.

Now granted there are too many initiatives on our ballot sometimes – there were 10 on last Novembers ballot alone, But in its 100 year history, the initiative, referendum and recall petition has produced many beneficial results in addition to a few clinkers. Prop. 13 comes to mind, and last years successful Prop 20, which removed the redistricting process from the hands of our legislators, and failed Props 19, to legalize marijuana and  23, which would have overthrown the onerous AB 32.

But the Democrats don’t like us to have that much say in our government – because they know what’s best for us and how best to spend our money without any pesky input from us. Heck, they already control our legislature, our governor, and every major elected office in the state – they just don’t want to contend with the actual voice of the people.  They’re also afraid of public backlash against their incompetence and malfeasance in office which is threatening to put bills on upcoming ballots mandating pension reform, restrictions on political fundraising by unions, education entitlement and reform and a host of other issues that citizens are pissed off about but that the legislature refuses to act on.

Now in an act of craven insincerity, they are backing radio ads aimed at inducing fear of signing initiative petitions. You may have heard them – a sweet female voice just signed a petition outside the local grocery store while the wise male voice tells her she probably just gave her signature to an identity thief, all her pertinent information will be shared on the global network of signature gatherers/identity thieves, and she should never do that again. Listen closely at the end, after the terrified woman promises never to do such a stupid thing again – listen to who is paying for the ad. It’s a  group called – Californians Against Identity Theft,  ALONG WITH backing by unidentified labor groups. The origins of the group are murky but the goal is not.  Identity theft is a major issue and cause for concern for everybody, I’ve written about it numerous times over the years, But the SOLE FOCUS of CAIT appears top be  signature gatherers and the initiative process. Sound like a well rounded group focused on the real issue – or some special interest? Yeah, that’s what I thought.

Maybe I’m just cynical but could the liberal labor movement and their Democratic lackeys in the legislature be in cahoots on this? Could they actually be waging a concerted campaign both in the legislature and on the airwaves to further their agenda of coercion and control? Naw, I’m probably just being paranoid. Of course just because you’re paranoid doesn’t mean they really aren’t  out to get you.

How much do like being manipulated? You must – you keep voting for these people.

Read more: http://www.fresnobee.com/2011/08/03/2487995/calif-democrats-attack-initiative.html#ixzz1UqBID2Lb

The opinions expressed in this blog are solely the purview of the author and in no way represent the views or policies of SRCAR, or any other reputable organization or asylum I am associated with.


California Legislature – Unclear on the whole 'jobs' thingy.

Say you’re the owner of a commercial building. Based on bids, you hire a company to come in evenings and clean the building keeping your investment intact and making it presentable for your employees and clients the next day. Now imagine that company is run very poorly, they hire cheap labor, do a very poor job, don’t even show up some days, maybe steal stuff from your workplace. At the end of the year, they’ve done such a bad job you go back out to bid and hire a reputable company that has a great reputation but will cost significantly more. 

Well, good riddance to bad company, right? You’re paying more but at least you’ve got quality service and no more problems right?  

Not in California. When our esteemed legislators reconvene mid-August after their mid-autumn respite from profligately squandering our money, one of the bills they will consider is AB350 (Solorio). The bill is called the ‘Displaced Property Service Employees Opportunity Act’ and here’s what it does. Whenever an owner of a building awards a contract to provide services for their building to a new contractor, the new contractor MUST HIRE the previous contractors employees to do the work. And you’d have to keep them in place for at least 90 days. 

The predecessor bill – the Janitor Opportunity Act signed into law in 2001, only applied to janitorial staff. The new and improved version would grant the rights/protections to janitors, window washers, landscape workers, security, cafeteria and dietary services as well. You as the building’s owner, the person who hires the service personnel to support your investment, have NO VOICE whatsoever in the process. You can hire a new company but still get the same lackluster service you tried to replace – at least for 90 days. 

Because the bill creates no new jobs and only applies an additional layer of regulation to an already overburdened jobs market in the state, the Southwest California Legislative Council signaled our opposition to the measure in April. This bill should have died in committee, or at the very least should never have passed the Assembly and should not be passed by the Senate. Unfortunately our Democratic majority Assembly passed the bill and the Senate will take the matter up in a couple weeks, with probably the same result. Jerry Brown should veto the bill but again…

Oh well, that’s what happens when you have a majority of our legislature who has never held an honest job. Their ranks are bloated with lifetime ‘public servants’ and sycophants who have always fed at the public trough, never met a payroll, never had to hire or fire employees, never tasted the glory of entrepreneurship nor dealt with it’s dark side. 

Keep it up, folks. The next regulation you pass should be one making it illegal for California companies to move out of state. With all the other crap you are heaping on them, that’s the only way you’ll prevent the dozens who are departing every week from heading to Texas or South Carolina or Nevada or anyplace but California.  


Gov. signs Realtor Bill for short sale relief.

New law gives added protection to short-sale hopefuls On Friday, Gov. Jerry Brown signed Senate Bill 458 (Corbett) into law.  The new law, which contained an urgency clause and became effective upon signing, protects homeowners pursuing short sales by barring first and secondary lien holders from going after sellers for money owed after the short sales close.

Making sense of the story

*     A short sale – a transaction in which the homeowner sells the property for less than is owed on the mortgage – must be approved by the lien holder or lien holders, if there is more than one.

*     Under previous law (SB 931 of 2010), a first mortgage holder could accept an agreed-upon short-sale payment as full payment for the outstanding balance of the loan, but the rule did not apply to junior lien holders. SB 458 extends the protections of SB 931 to junior liens.

*     The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) sponsored the bill and urged lawmakers to pass this much-needed legislation.

*     “The signing of this bill is a victory for California homeowners who have been forced to short sell their home, only to find that the lender will pursue them after the short sale closes and demand an additional payment to subsidize the difference,” said C.A.R. President Beth L. Peerce.  “SB 458 brings closure and certainty to the short-sale process and ensures that once a lender has agreed to accept a short-sale payment on a property, all lienholders – those in first position and in junior positions – will consider the outstanding balance as paid in full, and the homeowner will not be held responsible for any additional payments on the property.”

Read the full story <http://www2.realtoractioncenter.com/site/R?i=Y7pJy-rwyTJMoTmgvOXhDA..>


Take Action Now!

This week Congress will be debating amendments that will dramatically impact our business here in California – either extending or expiring the current conforming loan limits. Current loan limits are $729,000 max for conforming, with our area being closer to $625,000. If these expire our next max would be back to $425,000. Now  $425,000 may sound like a  pretty fair loan limit. Folks across the mid-west could buy three median price homes for that amount. But that’s part of what got us into trouble out here to begin with – our median price in Southwest California, as well as much of the state, was well over $500,000 for several years. But if you wanted to buy a median price home, you were forced into a non-conforming or jumbo loan. FHA loans fell to less than 3% of the market in 2006. So people started looking for alternatives to traditional financing. 

Viola – sub-prime, Alt-A, exotics. 

You’ve probably already heard that B of A is already operating under the new/old loan limits assuming that Congress will let them expire. This means larger, more costly jumbos are back in place for many buyers. You think our move-up and upper end market is dead now? Just wait. 

So please take a moment to respond to this Call to Action. This week the Senate will be considering an amendment to the Military Construction Appropriations Bill (don’t ask), to maintain the current loan limits for another year. Both CAR and NAR support this effort. This Call to Action urges our Senators to work to maintain the current loan limits to help fan the flames of the recovery they so desperately need. 

Please help us ensure that your clients have access to affordable mortgages. 

cta


Homeownership Matters NAR Bus Tour Continues

On the Road Again, Posted by Vince

Posted: 14 Jul 2011 06:45 AM PDT

VinceMaltaDo you hear the engine revving? The NAR Home Ownership Matters Bus Tour is taking off for Atlanta this weekend to kick off the second leg of our bus tour. From Atlanta, we’ll travel the U.S. discussing the value of home ownership with the media, REALTORS® and consumers until we roll into the Annual Conference in Anaheim, November 11 – 14th.

I can’t express to you enough how vital it is that we continue to sound the message that Home Ownership Matters “to people, to communities and to America.” I’ve been working in real estate for over 25 years. Never have I seen the confluence of challenges that REALTORS® have faced in the last three years.

Our clients are having a hard time getting loans. Lenders aren’t giving us a yay or nay on a short sale. The National Flood Insurance Program is set to expire on September 30th. That’s going to start holding up closings this month (so please answer the Call for Action!).

The challenges are plentiful. One way to ensure that we get the help we need to create a safe, well-functioning, healthy real estate market is to start talking. That’s why the Home Ownership Matters bus tour is designed to talk to local leaders, prospective home buyers and the media about how best to protect our industry so all responsible Americans have the opportunity to buy into the dream of home ownership.

During the last leg of the bus tour in March, we reached 27.3 million consumers through media coverage. That would have cost us $3.95 million if we had to pay for it.

Thousands of consumers came out to our bus tour events to learn more about the value of home ownership. We saw a 350 percent increase in weekly visits on our Home Ownership Matters Facebook page. Five thousand additional people visited HouseLogic.com. Two thousand members attended REALTOR® Town Halls and bus tour events in 13 states.

I can’t wait to see the progress we’ll make on this leg of the tour this summer and fall. We’ll be in Atlanta on July 16, at Atlantic Station from 11 a.m. to 3 p.m. Please come out and visit with us. Tell your clients to come out as well. They just might leave with a Lowe’s gift card in hand.

Check Realtor.org/BusTour for more information and future bus tour stops.

The future of our industry rests in our hands. I’m glad we’re getting back on the road to start talking! – Vince Malta, 2011 NAR Vice President and Liaison to Government Affairs


Help Extend the National Flood Insurance Program

 

I hope that you’ve all taken a minute to respond to the latest call-for-action from NAR. (That goes double for those who are always complaining that NAR doesn’t do anything for you.)

A bill, H.R. 1309, is being debated in Congress right now that would re-authorize, reform, and extend the National Flood Insurance Program for 5 years.

The NAR Land Use Committee, has been working on getting this bill in place for years – it’s been a top priority. Finally we have a bill that will truly make a difference if passed, or the NFIP program will sunset on September 30 of this year.

If that happens, it would be catastrophic for many areas, coastal regions, mid-west areas prone to flooding, etc. This program is the ONLY SOURCE of flood damage protection for 5.6 million home and business owners today, not to mention the millions of affiliated jobs like builders, remodelers, movers, mortgage lenders, insurance agents, real estate professionals and more. In the last 3 years alone there have been 9 stopgap extensions and 5 shutdowns. Just last year a shutdown of just a few weeks resulted in more than 47,000 home sales delayed or canceled – in a market that is way down to begin with.

Do we need MORE uncertainty from our leaders on this issue? We actually have a chance to provide some long term stability to at least one segment of our market, let’s not blow it. Take a minute – click on the page below and lend your voice to the chorus.

1.1 million strong. Very little we can’t do if we put our minds and hearts to it.

Thank you.