I am copying a post from another discussion. Question is... Since Auction.com is a real estate broker, are they breaking the law by soliciting our clients (sellers) and are they breaking the law by interfering with a purchase contract?
From an earlier post:
Dear Short Sale Superstars community,
Thank you all for reaching out with your concerns regarding Nationstar and Auction.com. In all cases, the seller is not Auction.com, but the actual financial institution that holds the loan. We simply provide the online platform for all sellers, institutional and private, to list their assets for auction. You can view the FAQ page for our Market Validation program here: http://www.auction.com/marketvalidation.php. With that said, please contact Nationstar to address your concerns at 877-343-6386. If there is anything further I may do to be of assistance, please free to reach out to me or my Customer Service Supervisors Yamir Gonzalez or Vicky Hernandez at 800-793-6107.
Director of Customer Service
The part about this that bothers me is that Auction.com says they are not the seller, rather the lending institution is the seller. WRONG, the lending institution is NOT the seller in a short sale, they would be the seller in an REO which is a completely different topic
here is an excerpt from the Market Validation Program that in my mind is pretty clear that they are interfering...
Q: Will listing agents be left out in the cold with no commission?
A: No. The cooperation and participation of agents assists in the success of the program. Agents will receive the full commission if the bids they submitted are accepted by the lender or if the homes are sold for a higher price at auction, which would result in a higher total commission.
NOTE "if the bids they submitted are accepted" What happens if a bid is submitted through Auction.com and accpeted? The listing agreement?
Jeff - I agree, that is a glaring error. The seller is not the financial institution.
Both Nationstar and Auction.com specifically told me that because the borrower is in distress, that they consider themselves as the seller.
Interesting Joseph. My point was that Auction.com is a licensed real estate broker and they are interfering with contracts. What would happen if I stepped into the role of "listing agent or auctioneer" without a valid listing agreement ?
Jeff I believe that it is highly possible that Nationstar may be violating multiple laws and their own contracts and agreements forcing the use of auction.com.
I've composed a draft letter from your homeowner clients to Nationstar that asserts that allegation. Using the litigation premise filed by one of Nationstars Investors: http://reaction.orrick.com/rs/emsdocuments/FinancialIndustryWeekInR...
Consider rejecting these Auction.com requirements in writing using strong language in a one-page letter signed by the homeowner. Something like this may be applicable: (editing for specific circumstance is advised)
Dear Nationstar Loss Mitigation Professionals;
We empathically reject the Auction.com short sale option (illegal mandate) as it appears it may violate real estate contract law in my state, Federal RESPA guideline rules and recent federal securities litigation alleges that Nationstar does not have their investors (owners of the loan) approval to dispose of properties using Auction.com.
We cannot and will not facilitate Nationstars “fee-gouging” and “equity-stripping” of their investor’s portfolios. We will not be a party to obvious RESPA violations on this transaction.
We demand that Nationstar diligently adhere to all state federal civil statutes and RESPA guidelines in the review of our short sale.
We respectfully request that Nationstar use the standard short sale process “approved in the Master Servicing Agreement executed by the investor of our loan.”
PLEASE review and approve the purchase contract our chosen licensed real estate agent has submitted.
Signed Mr. and Mrs. Homeowner
Cc: Nationstar Executive offices, CFPB, FHFA, FTC, Deutsche Bank, (or specific trustee of applicable investor’s portfolio)
After Nationstar receives, a couple of thousand of similar composed letters from Homeowners I believe will get their attention.