JOBS Act and You!

JOBS Act and You!

As you may be aware, President Obama signed the “Jumpstart Our Business Startups Act” (the JOBS Act) on April 5. This bill will make it substantially easier for companies to raise money, although key provisions do not take effect immediately. Will these changes provide opportunities — or challenges — to those selling interests in notes secured by deeds of trust and similar investments? Over the past 25 years, many new forms of securities offerings of interests in notes secured by deeds of trusts or “pool” arrangements for notes secured by deeds of trust have been created, some of which rely on rules that exempt the seller of...

Read more »

California Legislature Moves to Impose Due Diligence Standards on Brokers

California Capitol Building

An analysis of new legislation that will require brokers to qualify their investors before taking their money. Read on to learn more about what changes to expect and how you can access new tools to protect yourself and your business now. Please be sure to take advantage of the free offer located at the bottom of this message. For at least ten years I have been preaching to the mortgage brokerage industry that every day the members were acting less like real estate brokers and more like securities dealers.  My diatribe goes back to my being a member of the committee—appointed by then-Governor Jerry Brown (in his...

Read more »

Analysis and Response to Penal Code Sections 186.11 and 186.12

money-house

Asset Seizure Click this link to view the text of Penal Code Sections 186.11 and 186.12 apparently pursued by the AG and County DAs. AB 1293 was Chaptered on September 30th, 2011. The seizing of assets of white-collar criminals as an enhancement in aggravated fact situations, as defined, may be dangerous for real estate and mortgage brokers, escrow holders, appraisers, developers, and principals of small to moderate sized hedge funds, among others.  Three to four potential felonies are low hanging fruit relatively easy to prove up and establish, e.g., comingling and conversion (even in the context of forming an entity with private parties to acquire interests in...

Read more »

National Mortgage Servicing Settlement

iStock_000001035674XSmall

The National Settlement Executive Summary, the Mortgage Servicing Settlement Fact Sheet, and the Servicing Standards Highlights for the recent mortgage servicing settlement among the United States Justice Department, federal agencies identified within the Executive Summary, certain state Attorneys General, and five leading residential mortgage loan servicers including Bank of America; Citigroup, Inc.; J. P. Morgan Chase; Wells Fargo; and, Ally Financial, Inc. (formerly GMAC) collectively describe a significant accomplishment for homeowners receiving benefits from the settlement. Included within the settlement provisions is a prohibition against dual or two tracking by  mortgage loan servicers, e.g., loan servicers are reportedly not to engage in discussions or negotiations with borrowers...

Read more »

Action by Governor Brown Threatens Extinction of Mortgage Brokers

In his most recent Budget Proposal, Governor Brown has included plans to consolidate all businesses in the financial industry under one head. He proposes the elimination of the Department of Real Estate and the Office of Real Estate Appraisers and placing jurisdiction of these licensees under the Department of Consumer Affairs. At the same time the Department of Corporations and the Department of Financial Institutions will be merged into one new entity called the Department of Business Oversight. It seems that the Governor wants the consumer groups to limit the operations of the mortgage brokers, and the regulators of the big banks to regulate all the lenders...

Read more »

Appraisal Foundation Boards Seek Your Comments on Draft Revisions by December 5

TAF logo

I: The Appraiser Qualifications Board (AQB) has issued the following Exposure Draft: Fifth Exposure Draft of Proposed Revisions to the Real Property Appraiser Qualification Criteria Link: https://appraisalfoundation.sharefile.com/d/s37bad6cf5694643b Written comments requested by December 5, 2011 Send Comments to AQBComments@appraisalfoundation.org II: The Appraisal Practices Board (APB) has issued the following Exposure Draft: First Exposure Draft: Residential Appraising in a Declining Market Link: https://appraisalfoundation.sharefile.com/d/sbdb218d49bc48c6a Written comments requested by December 5, 2011 Send Comments to APBcomments@appraisalfoundation.org

Read more »

Appraisal Foundation Draft: Submitted for Comment By November 14

appraisal

The Appraisal Foundation has submitted a draft for comment by November 14: Communication and Reporting in the Uniform Standards of Professional Appraisal Practice. The 3 Wise Men invite you to post your comments here so that we may engage in a discussion with you here. We will also collect and submit your thoughts to TAF along with our commentary.   Link to the document under consideration: Communication and Reporting Discussion Draft   Email address for sending comments directly: ASBComments@appraisalfoundation.org   Details (from The Appraisal Foundation): Those who have followed the work of the Appraisal Standards Board (ASB) over the last several years are aware of the Board’s...

Read more »

Legislative UPDATE: Summaries of Bills Chaptered By the California Secretary of State

Legislative UPDATE: Summaries of Bills Chaptered By the California Secretary of State

The source for the following summaries is the Legislative Digest for each bill. Click the bill titles to download the full text PDFs. As of today, the following measures have been Chaptered: SB 4 (Calderon and Vargas) Mortgages. Requires the notice of sale, given pursuant to a deed of trust or mortgage secured by real property containing from 1 to 4 single-family residences, contain language notifying potential bidders of specified risks involved in bidding on property at a trustee’s sale, and a notice to the property owner informing the owner about how to obtain information regarding any postponement of the sale. Requires a good faith effort to...

Read more »

Independent Contractor Relationships Are Now More Dangerous to Establish or Maintain

Mousetrap with money

By Guy Puccio Two measures regarding independent contractor relationships were just enacted into law by the California Legislature. These legislative measures signed by Governor Brown are AB 1396 (Committee on Labor and Employment) and SB 459 (Corbett). Effective January 1, 2013, AB 1396 requires whenever an employer enters into a contract of employment for services to be rendered within this state and the contemplated method of payment involves commissions (as defined), the contract is to be in writing and is to include the method by which the commissions are to be computed and paid. This measure amends Section 2751 and repeals 2752 of the Labor Code. The...

Read more »

Must Mortgage Brokers Complete and Deliver Mortgage Loan Disclosure Statements in Residential Mortgage Loan Transactions?

Guy Puccio

By Guy Puccio Business and Professions Code Section 10240(c) purportedly extends an exemption to mortgage brokers when arranging “federally regulated residential mortgage loans.” However, this exemption is inapplicable to most loan transactions conducted by mortgage brokers registered with the NMLS as an LO (MLB/MLO) and even when arranging transactions where the loan proceeds are used for personal, family, or household purposes. The phrase “federally regulated” is substantially narrower than “federally related.” Under current law, “federally regulated” loan transactions are loans made by nationally chartered or licensed banks, savings and loans, savings banks, thrifts, and credit unions; or if state chartered or licensed, those financial institutions that have...

Read more »

Contents of CD that Will Be Distributed At Our Upcoming Workshop

legislative

I. Code Citations a. Business and Professions Code Citations – 10166.01 – 10166.17 (Implementation of the SAFE Act under the Real Estate Law) b. Civil Code Citations – 1090.5 (Requirements for Hiring/Using/Terminating Real Estate Appraisers) c. Financial Code Citations – 4970 et seq. and 4995 et seq. (California Requirements for “High Cost” and “Higher Cost” or “Higher Priced” Residential Mortgage Loans) II. “Dodd-Frank” Act a. HR 2509 (Federal Legislation Sponsored by NAMP/CAMP to Amend Dodd-Frank Regarding LO Compensation) b. Summary, prepared by S. Guy Puccio and Herman Thordsen, Esquire (A Summary of Significant Issues of This Act that Affect Residential Mortgage Loans and Mortgage Brokers) III. Federal...

Read more »

Volume Discount Available for “Make More Money Now” Workshop on October 22nd

100-dollar-bill

For detailed information about the upcoming Make More Money Now workshop with 3 Wise Men Q & A, click here. Bring your business partner(s) to our next workshop and receive a volume discount! Full Day attendance fee for one participant: $295 Full Day, second participant from the same firm or company: $195 Full Day, third, fourth, fifth (etc.) additional participants from the same firm or company: $140 each To register, select the appropriate fee (and box lunch selection) in the drop down menu on the Paypal button in the sidebar. If you have any questions about registration or payment, or if you need an alternate form of...

Read more »

Summaries of California Mortgage Industry Bills Currently Enrolled or Signed

California Capitol Building

These bills are complex and each covers more than more than one subject—an apparent new trend in Federal and State legislation. We are not addressing herein the list of measures that remain in committee or on the floor, as some of them may die and others may become two-year bills. The source for the following summaries is the Legislative Digest for each bill. Click the bill titles to download the full text PDFs. The following measures have been Enrolled, awaiting the Governor’s action: SB 6 (Calderon and Vargas) Real Estate: appraisal and valuation. Prohibits a licensee from knowingly or intentionally misrepresenting the value of real property. Prohibits...

Read more »

Agency Relationships Are Material Facts

iStock_000001035674XSmall

By S. Guy Puccio The agency relationships intended among principals and real estate and mortgage brokers are material facts. Regardless of whether it is a dual agency, a bifurcated agency, or an agency relationship with one party leaving the other unrepresented, it is a material fact to be disclosed at the outset or when the relationship becomes more than casual. See, Business and Professions Code Sections 10176(a) and (d), Civil Code Sections 2079.13 et seq., 2295 et seq., and 2923.1 and Huijers v. DeMarrais (1992) 11 Cal.App.4th 676. The obligation to disclose agency relationships in commercial transactions exists notwithstanding the typical interpretation that Civil Code Section 2079.13...

Read more »