M.A.R.S. - Mortgage Assistance Relief Services is a new FTC (Federal Trade Commission) ruling to help protect distressed homeowners from mortgage relief scams. Explaining the ruling, FTC Chairman Jon Leibowitz said, “At a time when many Americans are struggling to pay their mortgages, peddlers of so-called mortgage relief services have taken hundreds of millions of dollars from hundreds of thousands of homeowners without ever delivering results. By banning providers of these services from collecting fees until the customer is satisfied with the results, this rule will protect consumers from being victimized by these scams.”
This ruling not only applies to loan modifications, but also to short sales. Fines of $11,000 per occurrence and $11,000 per day may be incurred for violations, so it is important that you understand the new regulations and are compliant. If you provide, or arrange for someone else to provide, short sale services, you need to be sure that all documents, correspondence and advertising are in compliance.
Highlights of the Mortgage Assistance Relief Services ruling include:
■ Advance fees are outlawed. You may not collect a fee until the homeowner has an offer in writing that they agree to accept.
■ Homeowner has the right to reject an offer, and no fees would be charged
■ Various disclosures must be included in the initial contact and throughout the process. They need to be in writing. These disclosures are designed to protect the homeowner from being mislead, and help them make better informed decisions. These disclosures include stating you are not associated with the government, and your service has not been approved by the government or their lender.
■ Homeowner has the right to stop doing business with the provider at any time, and no fee is involved.
■ False or misleading claims are prohibited in advertising or communication about services or performance.
■ If you tell the homeowner to stop paying their mortgage, you must also make them aware that they may damage their credit rating, and could lose their home.
Check out the entire ruling: http://www.ftc.gov/os/fedreg/2010/december/R911003mars.pdf or view the FTC’s November MARS press release: FTC Issues Final Rule to Protect Struggling Homeowners from Mortgage Relief Scams
There has been a lot of hashing and re-hashing but the diclosure requirement remains, therefore, in any of my emails, flyers, mail, newspapers ads, website and/or phone conversations wherein Short Sales are mentioned/discussed ... you will see and/or hear the following:
If we discuss the topic of Short Sales at some point or I transmit information relative to Short Sales freely or at your request and your property is now, or in the future may be construed as, a Short Sale, I am required by law to tell you:
Neither Roger A. Sullivan, Realtor nor Windermere Real Estate is associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan. If you stop paying your mortgage, you could lose your home and damage your credit rating.
The afore-mentioned is given in mandatory compliance with required M.A.R.S. (Mortgage Assistance Relief Services) disclosure requirements mandated for Real Estate professionals who assist those homeowners/borrowers who may be in need of Short Sale assistance. I do not provide Loan Modification services. You will never have to pay a fee UP-FRONT for any Short Sale services I may perform or you may request of me.
Can't be too careful these days ... as always - Keep the faith !!
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