HISTORY OF AGENCY

The Agency relationship we share with our Clients has evolved significantly over the years and continues to take shape.  Whether you contribute these evolutions to the use of advancing technology, the changing needs and mindset of consumers, and/or as a response to lessons in history, there is no denying that the Real Estate industry needs an overhaul.

One consistent shift we continue to see each year is the focus on narrowing broad legal languages and structures regarding Agency & Disclosure.  The result has been an ethically strengthened industry and more standardize processes.

Agency representation hasn’t always been what it is today.  For example, can you imagine our industry without Buyer representation?  You might be surprised to learn that not so long ago Agency representation in Virginia only extended to Seller’s.  In fact, in the 1970’s the accepted practice for most states were the National standards, which only offered a blanket unilateral sub-agency.  This meant that all cooperating agents worked for the Seller and Listing agent.

What did this mean for the buyer?  Well, they were left to embrace the concept of Caveat Emptor, a Latin phrase meaning “Let the Buyer beware”.  However, the growing issue with sub-agency was that Buyers were given the impression that “their” best interests were represented by “their” agent.  As confusion regarding representation continued, state regulatory agencies found themselves facing significant legal problems, and the conflict and demand for equal representation could no longer be ignored.

The 1980’s created the first signs of the great divide of our real estate industry and despite the resistance from traditional brokers, Buyer Agency was born.  States began to define Agency relationships and passing mandatory Disclosure laws and regulations.  However, it wasn’t until 1992 when NAR made significant revisions to their MLS policies that made unilateral offer of sub-Agency optional, rather than mandatory.

Virginia General Assembly followed suit very shortly after in 1995, by passing Article 3 of Title 54.1 of Chapter 21, serving to protect the public by requiring Agency relationship Disclosure and forming the framework as to what activities would require Disclosure and when Disclosure would be due.  Since this 1995 amendment Disclosure of the Agency relationship has be required and must be given upon certain triggers, usually very early on in the relationship.  Prior to this Virginia Code creation, Agency and Disclosure imposed on Licensees were only broadly defined by Common Law.

Since then several revisions have been made to improve the legal structure and define the various different types of Agency.  To include: providing clarity regarding the differences between Client and Customer, creating limitations on Agency liability regarding misrepresentation, and to structure the Agency Duties to be performed by the Licensee within the different Agency relationships.  However, the core principle of Article 3 of Title 54.1 requires the Licensee to work in the best interests of their Client, above anyone else, including their own.

Other types of Agency relationships have been created and amended over the years in Virginia.  However, the last major Virginia Agency revision was with the adoption of the Limited Service Representative in 2006.  This addition provided real estate professional to offer Buyer’s and Seller’s with “Al La Carte” real estate service options.  Accordingly to Virginia Law, a Limited Service Representative would allow a Licensee to not provide one or more of the duties required of a Standard Agent.  HB 1907 makes several adjustments to this 2007 amendment.

The Agency relationship and our responsibilities and duties defined within are not only the law, but also the very core of our profession as real estate professionals.  We have an obligation to safe guard public interests as well as to treat our clients, customers, and one another as colleagues, with fair and honest dealings.  Failure to abide and perform our Fiduciary Duties could result in civil liability and/or disciplinary action by VREB, to include monetary fines and/or loss of licensure.

Author: Lee Gosselin, Associate Broker & Owner

 

$25B settlement reached over foreclosure abuses – NBC12 News,for Richmond, VA |

WASHINGTON (AP) – A landmark $25 billion settlement with the nation’s top mortgage lenders was hailed by government officials Thursday as long-overdue relief for victims of foreclosure abuses. But consumer advocates countered that far too few people will benefit.

The deal will reduce loans for only a fraction of those Americans who owe more than their homes are worth. It will also send checks to others who were improperly foreclosed upon. But the amounts are modest.

And few think the deal will do much to help struggling homeowners keep their homes or to benefit those who have already lost theirs.

About 11 million households are underwater, meaning they owe more than their homes are worth. The settlement would help 1 million of them.

“The total number of dollars is still small compared to the value of the mortgages that are underwater,” said Richard Green, director of the University of Southern California’s Lusk Center for Real Estate.

Federal and state officials announced that 49 states joined the settlement with five of the nation’s biggest lenders. Oklahoma struck a separate deal with the five banks. Government officials are still negotiating with 14 other lenders to join.

Bank of America will pay the most to borrowers: nearly $8.6 billion. Wells Fargo will pay about $4.3 billion, JPMorgan Chase roughly $4.2 billion, Citigroup about $1.8 billion and Ally Financial $200 million. The banks will also pay state and federal governments $5.5 billion.

The settlement ends a painful chapter of the financial crisis, when home values sank and millions edged toward foreclosure. Many companies processed foreclosures without verifying documents. Some employees signed papers they hadn’t read or used fake signatures to speed foreclosures – an action known as robo-signing.

President Barack Obama praised the settlement, saying it will “speed relief to the hardest-hit homeowners, end some of the most abusive practices of the mortgage industry and begin to turn the page on an era of recklessness that has left so much damage in its wake.”

The deal requires the banks to reduce loans for about 1 million households that are at risk of foreclosure. The lenders will also send $2,000 each to about 750,000 Americans who were improperly foreclosed upon from 2008 through 2011. The banks will have three years to fulfill terms of the deal.

The states have agreed not to pursue civil charges over the abuses covered by the settlement. Homeowners can still sue lenders on their own, and federal and state authorities can still pursue criminal charges.

The deal, reached after 16 months of contentious negotiations, is subject to approval by a federal judge. It’s the biggest settlement involving a single industry since the $206 billion multistate tobacco deal in 1998.

But for the many people who lost their homes to foreclosure in the past two years, some of them improperly, a check for $2,000 is small consolation.

“Two thousand dollars won’t cover my moving costs,” said Brian Duncan, who was evicted from his Tempe, Ariz., home last April.

Iowa Attorney General Tom Miller, who led the 50-state talks, said the $2,000 represents the homeowners’ best hope of getting reimbursed. They would have had trouble winning settlements in court because of the time-consuming complexity of litigation, Miller said.

Mike Heid, president of Wells Fargo Home Mortgage, said the agreement “represents a very important step toward restoring confidence in mortgage servicing and stability in the housing market.”

Mark Vitner, a senior economist at Wells Fargo Securities, said the settlement may help the housing market in the long run. That’s because it lets banks proceed with millions of foreclosures that have been stalled. Many lenders had refrained from foreclosing on homes as they awaited the settlement.

“We’ve got a lot of issues to work our way through in the housing market,” Vitner said. “What this settlement does is allow that process to get started.”

For the banks, the settlement comes mainly as a relief. The amount they have to pay isn’t as large as many expected, and all have set aside adequate reserves. The cash portion of how much each bank has to pay is relatively small.

“It’s really a wash,” said Paul Miller, bank analyst at FBR Capital Markets. “A billion dollars is nothing for these large trillion-dollar banks.”

The bulk of the settlement will go toward reducing underwater mortgages and refinancing some of them. But the banks had realized they weren’t going to collect the loans and had already written down their value, Miller noted.

The deal requires banks to make foreclosure their last resort. And they can’t foreclose on a homeowner who is being considered for a loan modification.

Still, the federal government has a dubious track record of enforcing such rules. The Obama administration’s signature foreclosure-prevention program has failed to help more than half of those who have applied to have their mortgage payments lowered permanently. Many have complained that the program is a bureaucratic nightmare.

Critics also note that the settlement will apply only to privately held mortgages and not to those owned by mortgage giants Fannie Mae and Freddie Mac. Banks own about half of all U.S. mortgages, or roughly 30 million loans. Fannie and Freddie own the other half.

The deal is “another sad example of Wall Street not being held accountable for fraud, perjury and crimes that created the greatest economic crisis since the Great Depression,” said Dennis Kelleher, CEO of Better Markets, a group that advocates stricter financial regulation. “The math does not add up in a massive ‘robo-signing’ scandal that is nothing more than systemic criminal conduct.”

The settlement also ends a separate investigation into Bank of America and Countrywide for inflating appraisals of loans from 2003 through most of 2009. Bank of America acquired Countrywide in 2008

Do You “LIKE” Us??

I hope that everyone had a great weekend, and if you are a NY Giants fan, you REALLY had a great weekend!

The question of my title, Do You “LIKE” Me, is in reference to our brand new Facebook Page for The Wilson Group.

My wonderful assistant has done and is doing an amazing job creating and managing our new page, and we are reaching out for as many “LIKES” as we can get.

Our goal for this page is for wonderful news, market statistics, polls, and maybe even some great coupons for time to time.

We at The Wilson Group strongly believe in building relationships with our clients and co-workers, superior client satisfaction, and providing the best services around our area!

If you wouldn’t mind, go ahead and LIKE our page.  CLICK HERE TO LIKE THE WILSON GROUP

Thanks, and if we can ever help with anything, please do not hesitate to reach out to us

Have a great week!!!!

At Your Service,
The WILSON Group
1805 Monument Ave, Suite 314
Richmond, Virginia 23220
1888-706-0170