When the housing market started to fall, many real estate agents started looking for creative ways to sell homes. Some of them legal and some of them were not legal. Many agents unknowingly committed fraud and other crimes because they listened to peers and “investors” that had new creative methods of making money with real estate.
The trend in California is reflected across the nation. Some of those who lost their license were guilty, and other were innocent. You see, in order for a real estate agent to be investigated there must be a complaint.
The local Realtor boards are more concerned with image than with truth. If a public citizen files a complaint about a real estate agent, there will almost always be some sort of disciplinary action. It could be a $100 fine if there wasn’t anything done wrong, or the person’s license could be revoked if they did something wrong.
I know this because I was a real estate agent for many years. I never had a complaint filed against me, but I have known people who have. The person filing a complaint is right and rather than risk damaging the image of a Realtor, the agent must pay.
I am not saying that they are not guilty. Because I was a real estate agent I was able to get to know many other real estate agents. Some of them are good honest people, while many others are slimy scorpions that will stab you in the back while smiling to your face.
Many of those scorpions were top producers which always amazed me.
Foreclosure Scams Trigger Record License Revocations in California
California is cracking down on licensed brokers involved in alleged foreclosure modification scams.
To date, the California Department of Real Estate reports over 775 licensees had their license revoked or simply surrendered their licenses while facing accusations.
The downturn in the real estate market is a big reason disciplinary actions are up.
“With so many people struggling to stay in their homes, foreclosure rescue and loan modification scams have risen dramatically,” DRE Commissioner Jeff Davi says.
“And what is even more unsettling, a majority of offenders involved in loan modification scams are not even licensed, which limits a consumer’s ability to obtain restitution or verify the legitimacy of a business.”
Over the past two fiscal years, the DRE averaged 446 license revocations and 59 license surrenders.
In 2009, license revocations jumped over 50%, to 672, while license surrenders jumped nearly 80% to 105. The 122 cases that resulted in license suspensions in 2009 remained relatively unchanged from the 125 license suspensions averaged in the past two fiscal years.
In 2009, the DRE initiated over 2,000 investigations involving loan modification complaints, which represents 25% of all cases set-up.
The DRE issued over 180 Desist and Refrain orders to nearly 348 different respondents performing loan modification services, ordering them to stop or change their business practices.
Of the 348 Desist and Refrain order respondents, approximately 60% were not licensed and ordered to cease licensed activity – which included offering loan modification services.
In addition, nearly 100 real estate licensees have been accused of violating the real estate law in connection with loan modification complaints. Many of the completed cases have been referred to law enforcement agencies for criminal prosecution.
In order to help inform consumers to stay away from the bad actors, the DRE posts on its website all the recipients of Desist and Refrain orders and Accusations in loan modification complaints along with a copy of the order. –more
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