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Foreclosure in Dana Point : Real Estate Advice

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Activity 3
Thu Jan 26, 2012
Terry G Hunter, MS Economics answered:
You're getting answers from all over the country, some of whom may not be conversant with Califoria law.
This is not something to "crowd-source".
You need to get trusted counsel from a single source (at least a local Realtor trained in short sales, and preferably an attorney, too) that you have "vetted" and trust.
You will likely find that the 1st TD holder may not accept a Deed-in-Lieu-of-FORECLOSURE (DIL) without an OK from the 2nd.
Additionally (and you may want to verify this with a credit repair outfit) the effect on your credit score is the same for a foreclosure and a DIL... so there is no benefit to doing either a foreclosure OR a DIL!
Conversely, the "hit" on your credit is significantly smaller with a short sale, so that is what you probably will want when you compare all the pro's and cons.
When you next apply for a mortgage, there will be a question as to whether you have had a foreclosure OR a DIL for some past amount of time... they are essentially the same to the inquiring lender.
So, the question is moot... you probably don't want to do a DIL OR a foreclosure, anyway!
Difficult to know without knowing all the facts, but I imagine that this is what you will find.
One thing IS clear, you need a trusted source of information if this is more than just a hypothetical question for you (i.e. if you have a stake in the outcome).
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0 votes 19 answers Share Flag
Thu Jan 26, 2012
Thom Colby answered:
Grant -

You are correct - there are about 500,000 licensees in CA (only about 170,000 Realtor members) and although many may not be qualified to handle short sales, they are ALL legally licensed to do so. That is far different from someone who is NOT licensed who cannot legally negotiate a short sale or the postponement of a foreclosure on behalf of the borrower.

An excerpt from the CAR legal team:

Make sure a SSN is properly licensed. A SSN must be a licensed real estate broker or a licensed
salesperson who is working under a broker. If the SSN works from outside the state of California,
DRE enforcement officers have advised that the out of state SSN must still hold a California license
if they wish to assist a California client.

An attorney is exempt from the real estate license requirement if certain conditions are met, such as
the attorney is not using or attempting to use the exemption for the purpose of evading the licensing
laws (Cal. Bus. & Prof. Code § 10133(a)(3)), and the attorney is not actively and principally engaged
in the business of negotiating mortgage loans (Cal. Bus. & Prof. Code § 10133.1(a)(5)).
An indication that a SSN is not properly licensed is when the short sale negotiation entity is an LLC.
In California, an LLC cannot get a real estate broker’s license and therefore, should not be doing
short sale negotiation. It is illegal to pay an unlicensed individual or entity for doing licensed work.
Even if it is technically your client who pays the SSN, as the person who effectively arranged the
transaction, you may expose yourself to both criminal and civil liability, and you could have your
license revoked or suspended by the DRE.
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0 votes 15 answers Share Flag
Tue Oct 28, 2008
Ellen Bosworth answered:
Hi Janet,
I think the property is 24382 Lantern Hill Dr C in Dana Point. It is a single level condominium which is Bank Owned (REO). They are asking 415,000 for a 2 bedroom, 2 bath 1200+ sf. condo. with association dues of $400 per month. The property is vacant.
you would like to see the multiple listing for this property, I can email it to you. Also, if you feel comfortable, let me know what your dream house is and I'll run the multiples and see what I come up with and can send those to your email as well.
Best Wishes,
Ellen Bosworth
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