Banks, Real Estate Commissions, & The Rico Act

Q: Does routine forced reduction of Realtor short sale commissions by Banks
amount to a form of extortion that falls under the RICO ACT?

Suppose we have a small group of powerful bosses whose names, by
coincidence, all end in a vowel (Fargo, Chase, B of A, etc).
They target a small class of defenseless business people (Realtors) in a
very distressed neighborhood (Las Vegas, or your home town). 

These people already owe the bosses a lot of money (on 1st and 2nd mortgages & HELOCS), so the bosses proceed to syphon off half of their business (REO listings = the
majority of closed transactions each month) and give that business only to
those who the bosses directly control (A very small group of
REO listing agents.  Bank of America recently said they added only 3 realtors
to their REO approved list in 2009 IN THE ENTIRE U.S. and NONE in NV; to
get on the list one needs a year’s experience in REO sales; tough to do if
you don’t already have REO listings. Didn’t our tax money bail them out? Shouldn’t they spread these real estate jobs around a little? Why, no! That would be … inconvenient.)

The bosses further squeeze the business people’s income on what is left  (By reducing short sale commissions by 25-33% routinely and often refusing to
approve the final HUD 1 closing statement unless “someone,” usually the Realtor, agrees
to pay for additional items on the HUD per bank demands at the 11th hour) and they keep it for themselves. The bosses have the peoples’ main industry (real estate) by the throat (Banks control REO sales, approve all short sales, and loan the money to any non-cash buyers).
When, due to declining income, the business people (Realtors) can’t pay back their
loans, the bosses take their houses and sell them at current discount
prices (in Las Vegas, Feb 2010 avg price is roughly 80% below Feb 2006). The business men lose whatever equity they paid down (5 to 20% at 2006 prices) and the bosses keep that for themselves, too. And then they come after the people for the deficiency at the old inflated prices, demanding payment despite the fact that the bosses have intentionally damaged their ability to pay.  (Q: Didn’t the bank make an implied promise under Equity Law NOT to damage their barrowers ability to repay the loan?)

This “routine reduction” applies to hundreds of short sale transactions each month in Las Vegas alone.  When Realtor income is down by 60-75% already, it feels like a systematic shake down. The bank is not actually a party to the short sale contract -  it is
merely a beneficiary of the closing. The Realtor can’t say no to a commission reduction without losing his entire commission.  If he refuses, the bank has a “gun to the head” of the transaction.  If the transaction does not close, the bank gets the property anyway via foreclosure. If the Realtor stands up for his rights, he may breach of his fiduciary duty to his client.  The bank order is an offer he can’t refuse because of FEAR of greater loss.

The commssion is reduced by an order called a “short sale approval” that arrives on
bank letterhead, signed by a bank officer,  and 100% of that amount is retained by the bank. For the Realtor, it’s death by a thousand cuts.

To make the math easy, let’s suppose a Commission of 6% (split between listing and selling agent) on a 0,000 short sale house is reduced by a bank to 4% = a 00 reduction.
Multiply this by 569 Las Vegas short sale transactions in January, 2010 = ,380,000 in additional bank profits in one month.  At this rate, the 4822 short sales closed in Las vegas in the past 12 months = roughly .6 Million in lost Realtor income in Las Vegas alone, all taken from the people who can least afford it. The average price per residence was actually 0,000 for the same period, so the $ amount is probably considerably higher. Multiply this by every city across the country and you know where the bank CEO bonuses come from. (GLVAR data)

It’s a lot of money.  Tony Soprano would be proud.

This is an update to the Las Vegas real estate market and the cancelled and postponed foreclosures. Most people are not aware that the inventory of REO’s are building up and there is going to be a flood in 2010 of new REO hitting the marketplace. www.toddmillertv.com http www.lasvegasrealestatemarketupdate.com
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mortgage. Does anyone know her best option? Rent/short sale/bankruptcy/walk away? She is afraid if she walks away or claims bankruptcy then the banks might come after her inheritance (which is to keep her in a nursing home) Can anyone help?

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Nevadans (South Dakotans) must — must! — re-elect Reid (Daschle). Not on the merits of performance, but because he’s a Beltway big shot. Conventional wisdom says he’s just too darn powerful to throw away. He’s politically to a small state what AIG is to the economy — "too big to fail."

I’m not buying that bedtime story, and if Harry’s smart he shouldn’t either. Even in the best of times, Nevadans love to hate Harry. In fact, the further away Harry gets from the dwindling numbers inside Las Vegas union halls, the testier people become toward him.

If Harry banks his re-election on the theory that Nevadans would be stupid to vote him out, then mark your calendars because you can count on a whole lot of stupid breaking out on the Tuesday morning of Nov. 2, 2010.

Now, as I am always careful to say, my warnings of discontent don’t mean Reid shouldn’t be re-elected. He has no opponent yet and there are arguments to be made for Reid. I’ll deliver what I think is a pretty good one in a future column.

But today I want to square up once and for all on the bogus "r-u-stupid" argument advanced by the Reid camp.

When Reid supporters play the stupid card I tell them, "OK, I’ll drink the Kool-Aid … if you can tell me exactly how his ‘power’ has benefited Nevadans."

The answer always is pregnant silence.

http://www.lvrj.com/opinion/42491622.html

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I just turned 16 and my parents are taking me shopping in las vegas. We usually stay at the Bellagio with the view of the fountains, but we heard that the hotel has gone waaaay downhill since steve wynn sold it… so we are going to stay at venetian or palazzo, but I heard they were building the st. regis condos in front so If you have stayed there which hotel is nicer and the best view and the type of suite you stayed in? And whats better strip or pool view? Also does anyone know if the rialto suite in the venetian is by the elevator banks?
Thanks so much!

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I live in Las Vegas, NV. On Sept 3rd we received a three day Notice to Quit. Looked at our options and realized that a request for a loan modification did not go through, and that the Foreclosure process had been completed and the house was now in the Banks Name.

At this point, a "negotiator" came to the home and offered us ,000.00 and three weeks to evacuate the house.

I honestly need a little more time and don’t think the money is worth it, so here is my question:

If I decide to decline the offer, take my chances and go to court, how much time overall can I gain? I have not received a letter for a court date yet. And, once I do get to the court, about how long will the Judge give me and my family to leave the premises?

In the long run, will I be able to save a little more money than what I am bein offered assuming that I am able to stay longer that the three weeks? I was actually looking to leave in January, how likely is for this to happen?

Or can I ask for more money and more time?

Please help!

Thanks.

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http://www.cnbc.com/id/26869324

Should these entities be put up for auction so that PRIVATE money (and not taxpayer money) can enter into the bidding, make it fairer, and lessen the burden for American taxpayers?

What will help these banks and mortgage companies loan again to those who can put 20% down? Getting those who made bad loans to lend again is critical; lubricating the lending facilities will, in turn, be critical in soaking up the high levels of real estate inventory in cities like Las Vegas.

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I am pre approved already by my bank. The realtor I have chosen stated if I do decide to purchase a house some of the homes that are being sold by other banks such as Wells Fargo will need for me to pre qualify with them too. Is this true? This is in Las Vegas if it makes a difference. Please help I am a first time home buyer.

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i am pre approved for a conventional loan, trying to put 20% down, but i have every offer i make rejected in favor of a "Cash" buyer. are there any properties actually available to me, or am i just wasting my time competing against investors with cash who will buy up the market to turn a profit? or does my realitor just suck?
um… as stated i am a first time home buyer, my credit is very good, but i have no collateral, how would one secure a personal loan? also why is it expected? most people finance a ,000 car.

p.s. i am also not asking for any closing costs or any money back.
ok, i’ll try to be "more clear" the loan is not the issue, i am pre approved, and lenders are writing small loans at this time. my question is about whether the banks will consider my "financed offer" or will they realistically only deal with the real estate investors who can pay cash.

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I live in Nevada and my home is upside down by 0,000 so I am giving it back to the bank. I know this is not the best thing to do but I’m single and I would rather let it go then keep making a payment that I will never get back in equity. My question is if I have a first and second with different banks what will happen with the second? will they still come after me or write it off.

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Here’s the full story. I bought a house in Nevada in April 2006, I was straight out of college and making pretty good money. Everyone I talked to told me to buy a house instead of renting. I trusted everyone and went ahead and did it. I bought the house with 2 loans. The first is interest only and the second is a really high interest rate with a 15 year balloon. I was told by my broker that my house would appreciate quickly and I would be able to refinance or sale in a few years.

Now for the tricky part, my fiance had to move to Oregon for school in August of 2007. I decided to do the responsible thing and stay in my house and keep my job. After a year of living alone in my house and being miserable every single day, I decided to move to Oregon as well. I knew it was going to be tricky financially, but I was willing to take the risk because I was seriously MISERABLE!

I was able to rent the house in Nevada but the mortgage is twice as much as the rent. So I loose about 00 a month. My new job makes about half of what my previous job made, and I have to rent an apartment here in Oregon. I’ve been working really hard to make it work out but it is now obvious that I can’t keep relying on my small savings to bail me out every month. I have decided to stop paying on the house because I’ve almost exhausted all of my savings and my income is not going to go up. I don’t plan on moving back into the house anyway. I honestly don’t want it anymore. I want to cut my losses.

I have perfect credit and no other debt. Not even a cent of credit card debt, no car payment, and I already paid off my school loans. I’m 26 years old. I know this is going to ruin my credit, but I feel so burned by this whole ordeal that I don’t think I’ll ever apply for any kind of loan again! I know it will take 7 years to repair my credit, I’m ok with that because I’m only 26.

So my question is: how long is it really taking banks to foreclose now days? I’m sure they are swamped, I read that 1 in 74 homes in Nevada is in foreclosure. Also, how likely is it that I’ll get sued for a deficiency judgment. Like I said before, I have no debt but I also have no assets so I’m not worried about anything but getting my wages garnished.

I should also mention that the house has lost 0,000 in value.

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