Short Sales and Foreclosures: What Is SB 94 About?

If you are having trouble with your mortgage, there is a new law that Governor Schwarzenegger signed on October 11, 2009  This new law is Senate Bill 94 and if basically tells any person who is working on a loan modification or morgage loan forearance service affecting 1-4 residential units they do not have to pay any upfront fees or advance fees.

  In other words, any person, including real estate licensees and attorneys can no longer require a mortgage holder to pay them for services that have not been rendered.  This is very significant because we know people who have paid $3000+ for a loan modification service or a short sale service and nothing happens, other than the money is down the drain. 

In addition, any fees that have been collected after October 11, 2009 have to be returned.

In reality, this may turn out to be a beneficial law.  One never knows until a law goes into affect.  Sometimes there unintended consequences.  I don't know what they could be with this law, but we will find out in the near future.

If you don't get help on your mortgage, why in the world are you paying someone?  The short sale negotiators we recommend to our sellers, Premier Negotiators, LLC, do not get paid until the sale closes.  If the sale doesn't close, the negotiators don't get paid.  That is how it should be.  Going thru a short sale is stressful enough.  Paying for an unsuccessful short sale is dumb.  Sorry for not being politically correct here, but it is still dumb.

For those of you who are legally minded, here is a link for Senate Bill 94.

This is a series of articles about Short Sales and Foreclosures by Sharyn and Victoria Crown, Downtown San Diego Realtors.