If you are taking short-sale listings, you’d better darn well know what you are doing!  If you don’t have the necessary training or experience, don’t just assume you can handle it.  You have a FIDUCIARY OBLIGATION to your clients to either bring someone in who knows what they are doing or refer them out to someone who does.

Remember, you cannot earn a commission on a house that goes to foreclosure.  Worse then earning no money is getting sued and then paying.

- The Bank Slayer

Below is a good article posted by Tori Stamps, MA, JD (a Broker in TN).

Realtor Lawsuits – The Other Side of the Coin…

I just read a featured blog by Walter Hayes called “Realtor Lawsuits” and have to say I was shocked by the comments.

Walter’s blog stated he’s heard “homeowners who have lost their homes to foreclosure are coming after agents and suing because their home didn’t sell and ended up being foreclosed on.”

The vast amount of comments basically said “What?!?  Those scummy lawyers?” Instead of looking at the possible validity of the argument, these agents are tossing blame to the attorneys.

The truth of the matter is that too many agents are practicing outside of their area of expertise!  Agents who have never been trained, and have no experience in what it takes to get a short sale to the table are taking these listings (because they need the commission) instead of referring them to agents who know what they are doing.  They list the property like any other and hope for the best (instead of contacting the bank on a daily (or more) basis working through the issues.)

I understand the desperation of agents out there right now.  Times are tough.  Really tough!  But, taking a listing outside of your level of experience and scope of normal practice, is not going to help.  Not only are you setting up your client to LOSE THEIR HOME (that should be bad enough!), but you are also setting yourself for a lawsuit!

AND - YOU WILL LOSE!

Short sales are a VERY labor intensive listing that require a VERY experienced agent.  While I’m an SFR (BFD, I took a class), I still bring in an agent who has A LOT more experience in short sales (from a different company, no less) because that’s what my clients NEED!  The Code of Ethics is VERY specific here - and it’s not hard to understand!

Article 11
…
REALTORS^® shall not undertake to provide specialized professional services concerning a type of property or service that is outside their field of competence unless they engage the assistance of one who is competent on such types of property or service…

If you are taking short-sale listings, you’d better darn well know what you are doing!  If you don’t have the necessary training or experience, don’t just assume you can handle it.  You have a FIDUCIARY OBLIGATION to your clients to either bring someone in who knows what they are doing or refer them out to someone who does.

Sometimes acting responsibly means you don’t get a commission.  And THAT’S O.K.  That’s what Fiduciary obligation means!  To put your clients well being above your own!

From Wikipedia.org…

“A fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.”

A fiduciary duty is the highest standard of at either equity or law. A fiduciary (abbreviation fid) is expected to be extremely loyal to the person to whom he owes the duty (the “principal”):he must not put his personal interests before the duty, and must not profit from his position as a fiduciary, unless the principal consents.

Wells Fargo & Company said on Wednesday that it had agreed to buy back $1.4 billion in securities it sold to investors according to an article by Cyrus Sanati.

The suit, brought by the California attorney general, Jerry Brown, contends that Wells Fargo had routinely misrepresented, marketed and sold auction-rate securities as safe, liquid and cash-like investments, omitting material facts.

“Wells Fargo convinced thousands of investors to purchase auction-rate securities with promises of robust returns and liquidity, but when the market collapsed, investors were left out in the cold,” Mr. Brown said in a statement. “Based on misleading advice, investors bought these risky securities.”

If Wells Fargo will lie to its own investors imagine how easy it is to lie to a home owner.   If you or a homeowner you’re  assisting in a short sale is dealing with Wells Fargo then tread carefully.  We routinely see Wells agreeing to short sales but then slipping in several clawback clauses.  Make sure an attorney reviews the final short sale agreement to keep you and your seller out of trouble.

-          The Bank Slayer

Testimony from a “copy” is inadmissible. Testimony is inadmissible unless it comes from a witness accepted by the court — not some lawyer lathering up his mouth and using finesse to escape the rules of evidence.   Every witness must be sworn, must have personal knowledge of the contents, must remember it ALL and be able to communicate it with specificity such that a court could rule without the court creating a document that had never been in existence before the evidentiary hearing.

Ever hear the old “buyers are liars”?  Some of attorneys are right there with ‘em. As soon as the Lawyer starts talking you should probably be objecting since he is not sworn, not a witness and never will be.

So what this means is that an affidavit that is sworn must be the “testimony” of a witness accepted by the court who has personal knowledge and is not reporting what was told to them by someone else and not be reporting what they read in another document.

Hats off to our friend Neil Garfield at Livinglies for a great piece on evidence.      Show me the proof!!!