Spring Caravan

Mark FagergrenLicensing/Education Director

Spring Caravan?

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“ Hot Topics”

Real Estate

5Inactive licensees

must renew

Real Estate

4Expired inactive

licensees MUST

complete CE

Real Estate3 No more paper change cards

Real EstatePaper change cards will be accepted for Principal Broker status changes or legal name changes

Real Estate

2 Complete CE by the 15th of the month

“We bank CE credits daily.”

Real Estate

Deposited ( Pending) vs. Banked (Posted)

Real Estate

Banked hours can be viewed in RELMS account

Two Year Renewal Cycle

Take RC110423Caravan 3 Hour Course

Take R112835Appraisal 3 Hour Course

Take RC101253Ethics 3 Hour Course

Take R120413FHA 2 Hour Course

Take R110378Tech 1 Hour Course

Take RC101209 Fraud 3 Hour Course

Take RC110832REPC 3 Hour Course

License Issued for Two Years

One Year

Renewal Window Opens

CE must be completed by the 15th to ensure on-time renewal.

Provider Ten Provider Ten Day BankingDay Banking

Two Year Renewal Cycle

Take RC110423Caravan 3 Hour

Course

“I have plenty of time to complete my CE.”

“I don’t need to worry about education now.”

“I think my license might need to be

renewed this year.”

“I’ll take my CE next month.”

“I can take my classes later.”

“I should start taking my classes.”

License Issued for Two Years

One Year

“6 weeks until my license expires. I still have enough time.”CE must be completed by the 15th to ensure on-time renewal.Take CE Courses the day before expiration.“I know it’s the 29th but I’m sure I can finish my CE in time.”

Provider Ten Provider Ten Day BankingDay Bankingx

Real Estate

1 “Live” Posting vs Time Delay Banking

Utah Sales Agent

LicenseRenewal Fee

$42

Arizona (2 Year) $200 +$152

California (2 Year) $245 +$197

Colorado (2 Year) $114 +$66

Idaho (2 Year) $160

+$112

Montana (1 Year) $87.50

+$127

Nevada ( 4 Year) $280

+$92

Wyoming ( 2 Year) $250

+$202

+$135 Average 181% Higher

Mortgage

• Lending Manager License

Qualification Requirements

New Application Rules (pending) and Forms:

• Mortgage Call Reports are required to be submitted to

the NMLS for the third quarter data

(July 1 – September 30) are due by

November 14, 2012

Mortgage Call Reports contain two components:

1. Residential mortgage loan

activity.

2. Financial Condition.

Financial Condition Reports

• Additional information and samples can be found at:

http://mortgage.nationwidelicensingsystem.org/slr/common/mcr/Pages/default.aspx

May 8, 2012- Independent Loan Processors are required to be licensed

–Loan processors who are employed (W2)

–Independent loan processors (1099)

–Independent loan processors must be licensed but NOT sponsored (inactive).

Mortgage Loan Originator

Renewal Fee$78

Arizona (1 Year) $250

+$172

California (1 Year) $300

+$222

Colorado (1 Year) $80

+$2

Idaho (1 Year) $200 +$122

Montana (1 Year) $400 +$322

Nevada (1 Year) $125 +$47

Wyoming ( 1 Year) $120

+$42

+133 Average 70 % Higher

Appraisal

• Newsletter article

The Appraisal Qualifications Board (AQB) has recently enacted some changes to licensing criteria that will take effect on January 1, 2015.

There are NO EXCEPTIONS to

these requirements.

1. College level education for all Licensed Appraisers – 30 semester credit hours from a college or university OR an Associate’s degree or higher in any field.

2. College level education for all Certified Residential Appraisers – Bachelor’s degree or higher in any field from an accredited college or university.

3. Trainee Appraiser and Supervisory Appraiser

Course (required attendance) with

specifications for course content to be established

by the AQB.

Existing credential holders are ONLY required to meet these new college education standards IF they supervise/train new trainees and/or change a licensing credential.

The future of the appraisal industry:

1. New education requirements from the AQB

2. Difficulty obtaining field experience

3. Restrictions on the use of trainees and licensees by lenders and government sponsored enterprises

4. Higher underwriting standards

5. Increased litigation and disciplinary actions taken against appraisers

6. Higher insurance requirements

7. Lack of motivation to increase appraisal efficiency ( failure to innovate)

According to the ASC website, there are currently 107,345 credentialed appraisers in the country

Age of Appraisers: 2012Utah DRE Statistics

Certified General AppraisersUT DRE Statistics - 2012

Certified ResidentialUT DRE Statistics

Licensed AppraisersUT DRE Statistics

Certified General Certified Residential Renewal Fee $ 400

Arizona (2 Year) $425 +$25

California (4 Year) $435 -

$182.50

Colorado (3 Year) $240 -$240

Idaho ( 1 Year) $350

+$300

Montana (1 Year) $515

+$630

Nevada $420

-$60

Wyoming ( 2 Year) $500

+$100

+$82 Average 20% Higher

All Licensees

• Take a RELMS class

• E-mail from an appraiser

QUESTIONS?

Mortgage FraudMortgage Fraud

DRE InvestigatorsDRE Investigators

Marv EverettMarv Everett

Travis CardwellTravis Cardwell

Fraud of the PastFraud of the Past

White out fraudWhite out fraud False documentsFalse documents Equity skimmingEquity skimming Illegal flippingIllegal flipping Straw buyersStraw buyers False advertisingFalse advertising

What’s Trending?What’s Trending? Unlicensed Unlicensed

ActivityActivity Loan officer assistantsLoan officer assistants Real estate agents doing Real estate agents doing

loan modificationsloan modifications New companies offering New companies offering

modifications modifications

Referral FeesReferral Fees Don’t get caughtDon’t get caught. We . We

know it’s happening.know it’s happening.

Loan ModificationsLoan Modifications No up front feesNo up front fees No pay until lender No pay until lender

and borrower and borrower agree to termsagree to terms

Must have a loan Must have a loan originator licenseoriginator license

Don’t disguise up Don’t disguise up front fees with front fees with other servicesother services

Misleading Misleading AdvertisingAdvertising

InvestigationsInvestigations

We investigate every complaint we receiveWe investigate every complaint we receive Records must be made availableRecords must be made available If the circumstances of the complaint are If the circumstances of the complaint are

serious enough, we will pursue a criminal serious enough, we will pursue a criminal indictment not just a fine and a license indictment not just a fine and a license revocationrevocation

Recent Fortified Financial ArrestRecent Fortified Financial Arrest Currently working with the FBI, IRS, Currently working with the FBI, IRS,

Attorney General, and US AttorneyAttorney General, and US Attorney

Investigations Investigations Continued…Continued…

We are seeking an arrest on several We are seeking an arrest on several cases currently being workedcases currently being worked

All actions taken by the Division are All actions taken by the Division are now being uploaded to the NMLS now being uploaded to the NMLS Regulatory Action Section and not Regulatory Action Section and not just the Division Newsletter just the Division Newsletter

What’s Coming your What’s Coming your way?way?

New language regarding company New language regarding company Incentive ProgramIncentive Program

NMLS AuditsNMLS Audits Surprise Visits by Marv and TravisSurprise Visits by Marv and Travis

Questions??

DIVISION OF REAL DIVISION OF REAL ESTATEESTATE APPRAISER APPRAISER

INVESTIGATORSINVESTIGATORS

Craig LivingstonCraig Livingston

Ken WamsleyKen Wamsley

Jim BoltonJim Bolton

TYPES OF COMPLAINTS & TYPES OF COMPLAINTS & WHERE THEY COME FROMWHERE THEY COME FROM

WHERE COMPLAINTS WHERE COMPLAINTS COME FROMCOME FROM

Other Government AgenciesOther Government Agencies Home ownersHome owners Other appraisersOther appraisers Lenders & Mortgage CompaniesLenders & Mortgage Companies Real Estate AgentsReal Estate Agents Division of Real EstateDivision of Real Estate AssessorsAssessors

Government AgenciesGovernment Agencies HUD Policy:HUD Policy:

Suspension or Suspension or deficiencies found deficiencies found in appraiser reports in appraiser reports will be referred to will be referred to state regulatorsstate regulators

Government AgenciesGovernment Agencies

We, most likely, will only We, most likely, will only look for USPAP (Uniform look for USPAP (Uniform Standards of Professional Standards of Professional Appraisal Practice) Appraisal Practice) violationsviolations

OTHER GOVERNMENT OTHER GOVERNMENT AGENCIESAGENCIES

FREDDIE MACFREDDIE MAC Government Government

sponsored enterprisesponsored enterprise Not as many as in Not as many as in

the pastthe past

HOME OWNERSHOME OWNERS

My home is worth what???My home is worth what???

This is where large This is where large number of our complaints number of our complaints come fromcome from

HOME OWNERS & HOME OWNERS & COMPARABLESCOMPARABLES

““Appraiser used Appraiser used wrongwrong comparables.”comparables.”

Homeowner may know of other Homeowner may know of other comparables.comparables.

HOME OWNERS HOME OWNERS cont.cont.

It’s a hard time for everyone, It’s a hard time for everyone, appraisers tooappraisers too

Remember, if it weren’t for them you Remember, if it weren’t for them you wouldn’t be doing an appraisalwouldn’t be doing an appraisal

““Ms. or Mr. Appraiser was there for Ms. or Mr. Appraiser was there for less than 10 minutes”less than 10 minutes”

OTHER COMPLAINTS cont. OTHER COMPLAINTS cont. Other AppraisersOther Appraisers

Review appraisersReview appraisers Appraisers did the same propertyAppraisers did the same property Appraisers from different Appraisers from different

geographic areasgeographic areas

OTHER COMPLAINTS cont. OTHER COMPLAINTS cont.

Remember when you accept an Remember when you accept an assignment, you are saying you assignment, you are saying you are competent to work in a are competent to work in a particular area, this is particular area, this is youryour responsibility.responsibility.

USPAP REQUIREMENTSUSPAP REQUIREMENTS Acquiring CompetencyAcquiring Competency

1.1. DiscloseDisclose the lack of knowledge and/or the lack of knowledge and/or experience before accepting assignmentexperience before accepting assignment

2.2. Take all stepsTake all steps necessary or necessary or appropriate to complete the appropriate to complete the assignment competentlyassignment competently

3.3. Describe in the reportDescribe in the report the lack of the lack of knowledge and steps taken to complete knowledge and steps taken to complete the assignment competently.the assignment competently.

OTHER COMPLAINTSOTHER COMPLAINTS cont. cont.

Lenders, Mortgage Lenders, Mortgage CompaniesCompanies Low appraisal affects loan closingLow appraisal affects loan closing

Real Estate AgentsReal Estate Agents Offer failed due to low appraisalOffer failed due to low appraisal Wrong comparablesWrong comparables

Division of Real EstateDivision of Real Estate Spin off from another complaintSpin off from another complaint

OTHER COMPLAINTSOTHER COMPLAINTScont.cont.

County AssessorsCounty Assessors Tax AppealsTax Appeals

Not complying with State StatuteNot complying with State Statute Violating USPAPViolating USPAP

RULE REQUIRING RULE REQUIRING APPRAISERS TO RESPONDAPPRAISERS TO RESPOND

Rule R162-2g-502a (1)(h) requires Rule R162-2g-502a (1)(h) requires you to respond to the Division within you to respond to the Division within 10 days10 days

Possible $5,000.00 violationPossible $5,000.00 violation

REASONABLE & REASONABLE & CUSTOMARY FEESCUSTOMARY FEES

Dodd-Frank ActDodd-Frank Act AMCs required to pay reasonable and AMCs required to pay reasonable and

customary fees. customary fees. Federal agencies have exclusive authority to Federal agencies have exclusive authority to

interpret and adopt regulations regarding interpret and adopt regulations regarding reasonable and customary fees. reasonable and customary fees.

The Attorney General's Office may enforce The Attorney General's Office may enforce the reasonable and customary fees provision.the reasonable and customary fees provision.

The Division is accepting complaints. If The Division is accepting complaints. If evidence is found to support an action, it will evidence is found to support an action, it will be referred to Division’s Assistant Attorney be referred to Division’s Assistant Attorney General for further review and action. General for further review and action.

THANK YOUTHANK YOU

QUESTIONS ???????QUESTIONS ???????

Division of Real EstateDivision of Real Estate

• David MechamDavid Mecham

• Carlos AlamillaCarlos Alamilla

• Kurtis HughesKurtis Hughes

Enforcement InvestigatorsEnforcement Investigators

Problem areasProblem areas

• Trust Account ViolationsTrust Account Violations

• Unlicensed Short Sale Unlicensed Short Sale NegotiationsNegotiations

• Short Sale / Foreclosure Rescue Short Sale / Foreclosure Rescue ScamsScams

Trust Account ViolationsTrust Account Violations

• Trust Accounts are being used as a Trust Accounts are being used as a personal ATM for the Brokerage or broker’s personal ATM for the Brokerage or broker’s personal usepersonal use

If an employee carries out If an employee carries out a scheme to steal trust a scheme to steal trust account money from the account money from the brokerage, the broker is brokerage, the broker is still the responsible still the responsible person.person.

Recent investigations of Recent investigations of multiple brokerages have multiple brokerages have shown the amount of shown the amount of missing trust account missing trust account monies from those monies from those brokerages is approachingbrokerages is approaching

$1,000,000.00$1,000,000.00

How does the money go How does the money go missing?missing?

• Broker allows cash to be acceptedBroker allows cash to be accepted• Broker has a debit card attached to the Broker has a debit card attached to the

trust accounttrust account• Broker fails to reconcile monthlyBroker fails to reconcile monthly• Broker assigns an employee to oversee Broker assigns an employee to oversee

the property management account and the property management account and the employee embezzles moniesthe employee embezzles monies

• Broker reviews an Excel spreadsheet Broker reviews an Excel spreadsheet created by the accountant and not the created by the accountant and not the bank statementbank statement

•A process where the real estate A process where the real estate agent/s and/or other parties set agent/s and/or other parties set out to defraud lenders by out to defraud lenders by siphoning monies intended for the siphoning monies intended for the short sale lender then divert these short sale lender then divert these monies for their own use. Lenders monies for their own use. Lenders are led to believe these are are led to believe these are legitimate charges as part of the legitimate charges as part of the short sale.short sale.

• A process where complicit real A process where complicit real estate agents and/or real estate estate agents and/or real estate investors will knowingly submit low-investors will knowingly submit low-ball offers to the short sale lenders ball offers to the short sale lenders trying to convince these lenders that trying to convince these lenders that the properties are worth much less the properties are worth much less than the current market supports; at than the current market supports; at the same time marketing the the same time marketing the properties to buyers for many properties to buyers for many thousands of dollars more. cont…thousands of dollars more. cont…

• The short sale lender is usually not The short sale lender is usually not aware that there is another aware that there is another transaction for more money that transaction for more money that will close simultaneously or shortly will close simultaneously or shortly after the approval of the short sale.after the approval of the short sale.

Foreclosure ProcessForeclosure Process

Owners Existing mortgage

NOTICE OF DEFAULT

Behind on Payments

ForeclosureTransfer Title

Short Sale Foreclosure Rescue ScamShort Sale Foreclosure Rescue Scam

Owner NOTICE OF DEFAULT

Behind on Payments

Stall Foreclosure

Real Estate Agent

False Preliminary HUD’s Straw Buyer

Dummy Offer

Agent Skims the Difference

False Liens / False Tax Liens

Real Buyer Real HUD’s

Questions?

Thank you. . .