FTC Cancels MARS Disclosure Rule for Realtors But....

Quoted from Florida Realtors News:

"WASHINGTON – July 15, 2011 – In a move the National Association of Realtors® calls “a substantial victory for Realtors,” the Federal Trade Commission (FTC) announced that it will not enforce most of the provisions of the Mortgage Assistance Relief Services (MARS) rule against real estate licensees

As a result of the stay on enforcement, real estate licensees who provide short sale services will not have to make the disclosures required by MARS as far as the FTC is concerned. However, the FTC announcement also gave Florida Attorney General Pam Bondi the ability to overrule the FTC within the State of Florida.

Florida Realtors has contacted Bondi’s office, but an official answer isn’t expected before next week at the earliest. In the meantime, Florida Realtors Law and Policy department recommends that Realtors continue to use the MARS disclosures until further notice."

Let's hope Ms. Bondi agrees with the FTC.

Comments welcome.

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Replies to This Discussion

Permalink Reply by Mercedes Natad on July 17, 2011 at 4:37am


Jim Schneider said:

Great find Wendy.

What's funny is that for a large segment of Realtors, they probably still haven't heard of MARS!

You're so right. There are so many "seasoned" agents that would never touch a short sale. Oh well, more for us right?!
Permalink Reply by Mercedes Natad on July 17, 2011 at 4:38am
Thanks, thats what I wanted to know. I will just stick to what I've been doing.

Thom Colby Newport Beach CA said:
No charging up-front fees in California !
Permalink Reply by Jim McCormack on July 17, 2011 at 4:48am
Good news!  Let's see how the individual states respond, though.
Permalink Reply by Tni LeBlanc (805) 878-9879 on July 17, 2011 at 5:11am
Those disclosures are so confusing to short sale sellers.  And they really make us seem like the enemy in my opinion when the truth many times is that we are doing important work in this market trying to clean it up.
Permalink Reply by Linda Solomon on July 17, 2011 at 6:29am

 

http://www.realtor.org/topics/mars/politicaladvocacy

 

Effective immediately, real estate professionals acting in their licensed capacity will no longer need to comply with most of the Rule’s requirements, including the required disclosures, advance fee ban, and recordkeeping requirements.

This forbearance of enforcement will only apply to real estate brokers (and real estate agents under their direction and control) who are:

1.Licensed and maintain good standing pursuant to any applicable state law requirements;
2.In compliance with state laws governing the practices of real estate professionals; and
3.Assisting or attempting to assist a consumer in negotiating, obtaining or arranging a short sale of a dwelling in the course of securing the sale of the consumer’s home.

Permalink Reply by Kimberley Kelly on July 17, 2011 at 7:34am
I LOVE this..no more confusing MARS disclosures for me out here in Palm Springs, California.  As Thom mentioned, no up front fees out here.  Commission is clean and straight forward..
Permalink Reply by Pamela Lester on July 17, 2011 at 8:31am
Federal Law PROHIBITS Realtors from charging upfront fees for negotiating a loan modification, or loan terms during a short sale, period! 
Permalink Reply by Stephen B. McWilliam on July 17, 2011 at 8:36am
More specifically it is the Federal SAFE Act which prohibits these charges.  All states were required to incorporate the SAFE Act into their laws.  Typically, the state will act on violations long before the Federal government will unless it involves a great deal of money and/or customers. Besides it being a felony in Florida the state can take administrative action against the real estate license.
Permalink Reply by Maya Thomas on July 17, 2011 at 8:51am
What a time saver!
Permalink Reply by Patrick Fleming on July 17, 2011 at 1:11pm
Does Florida law prohibit traditional sellers to pay a flat-fee up front for MLS/realtor.com advertising or are only shortsale sellers precluded?

Stephen B. McWilliam said:
Interesting concept.  However, I don't know why any Seller would do that considering the short sale lender pays the broker's commission.  It doesn't save the Seller any money.  In the case of that type of listing the Seller is really simply requesting it to be advertised by the broker.  In Florida, the legal definition is typically No Brokerage Relationship.
Permalink Reply by Stephen B. McWilliam on July 17, 2011 at 1:14pm
No, they're typically referred to as Limited Service Brokers.  Those operating in that fashion will operate as a No Brokerage Relationship capacity as defined in Florida law.  Considering a short sale lender will pay a full service brokerage fee in most cases there would be little incentive for almost any Seller to engage a Limited Services Broker.
Permalink Reply by ElizabethWeintraub00697006LyonRE on July 18, 2011 at 3:17am
Same thing in California. Attorney General can overrule. Not only that, but the newly formed Consumer Financial Protection Bureau is taking over MARS from the FTC this Thursday. The CFPB will then govern the law, and the law has not changed, people.

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