Hello to all!
Our office has been receiving quite a few phone calls from agents and brokers with questions about the newly enacted Mortgage Assistance Relief Services Act (MARS) introduced by the FTC. As of December 29th, 2010 the FTC requires new disclosures to be made by anyone providing mortgage assistance services (which include loan modifications, short sales, or other foreclosure prevention services).
Section 322.2 DEFINITIONS (i) ‘‘Mortgage Assistance Relief Service'' means any service, plan, or program, offered or provided to the consumer in exchange for consideration that is represented, expressly or by implication, to assist or attempt to assist the consumer with any of the following: and followed by subsection (6) Negotiating, obtaining or arranging:
(i) A short sale of a dwelling,
(ii) A deed-in-lieu of foreclosure, or
(iii) Any other disposition of a dwelling other than a sale to a third party who is not the dwelling loan holder.
The FTC's Mortgage Assistance Relief Services Act (MARS) dictates:
You must give clear disclosure (guided by MARS) on your marketing that you are not affiliated with the lender or a government organization.
You must give clear expectations of all fees & results.
Non-attorney entities or persons may not charge fees in advance.
Also, not only what you say, but HOW you say can play a big part keeping you compliant or not. Agents and brokers need to be extra careful to use the correct verbiage and information when talking to clients about Foreclosures, Short Sales, Loan modifications, etc. With penalties of up to $11,000.00 per day for potential violations, it is very important for all real estate agents, brokers and non-attorney persons or entities providing such services to become familiar with this new set of regulations. Below is a link to an on-line resource that does a pretty good job breaking it all down.
http://homesolutioncounselors.com/ftcs-mars-rule-short-sales-disclosures-part-1-of-3
All the Best,
Rick D. Misitano
Law Offices of James M. Bosco
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