The B.S. Show is B-Blair Ballin, A REALTOR with The Williams Real Estate Company in Scottsdale, Arizona and S-Stephen Garner, A title rep for a national title insurance company in Mesa, Arizona. We are taking the “BS” out of Short Sales.
We are back for episode 6-Should I short sale? In previous episodes we have discussed Deficiency, Short Sale Information Security, and the short sale process to name a few. Today we took a road trip to Phoenix. By now you have heard the term “short sale” hundreds if not thousands of times, today we show you what it looks like when someone can’t catch up on payments, and can’t modify the loan, its called Foreclosure.
I have personally heard from numerous REO (Real Estate Owned) REALTORS that their supply of foreclosures is dwindling. They point to the fact that banks are aggressively pushing short sales over foreclosure. Short sales have never been as easy to close as they are today.
If you are an ARIZONA homeowner that would like to discuss whether or not a short sale is right for you, please contact us.
Blair Ballin and Stephen Garner are back for episode 5 of the B.S. Show. As part of our mission to add value to you, we aim to take the “BS” out of the short sale process. Ask 5 people about short sale information and you are likely to get 5 different answers.
In Episode 2 we discussed Deficiency with Doug Farnham of Thomson Conant’s Mortgage Mediation Group
Episode 3 we were back at Thomson Conant with Don Doerr and Doug Farnham for “Short Sale and the Security Nightmare” which dealt with the proper protection and disposal of confidential information collected by a REALTOR from a client during the short sale process. We talked about the steps a REALTOR should take to protect their client(s) from identity theft-creating logs, shredding documents, etc..
Episode 4 Because it nearly impossible to collect sensitive client information without using a computer, email or website, we went back to Don and Doug for “Short Sale and the Security Nightmare-Electronic Security”.
We took last week off as Real Estate Bar Camp Phoenix was in town here in Scottsdale. Bar Camp is an “un-conference” where real estate professionals come to discuss and learn about best practices and new technology surrounding social media. We couldn’t miss that.
For Episode 5 we decided to give our experts a break and get back to the roots of the B.S. Show-us We were ready to start when a funny thing happened…..Take a look.
We have some more great information planned for the future episodes of the B.S. Show, with some exciting guests as well.
By the way, how are we doing? What do you think of the B.S. Show?
In Episode 3, we met with Don Doerr, Chief Information Officer and Doug Farnham of Thomson Conant’s Mortgage Mediation Group to discuss Short Sale and the Security Nightmare. We focused on safety and compliance when collecting sensitive financial documents related to Short Sale. Arizona is in the top 5 states for identity theft. According to Don and Doug, If ID theft is linked back to a leak at your company, you will be required to demonstrate how you have followed all required regulations.
Sensitive documents usually collected by a REALTOR during the course of a short sale include tax returns, pay stubs, social security numbers, mortgage information, pretty much everything in the hardship package submitted to the bank.
Excerpt
“Most loan originators are aware of the rules associated with accepting sensitive client information. They do it on a daily basis. Most real estate professionals, however, have not had to deal with compliance regulation and processes such as DSS (Data Security Standard), DLP (Data Loss Prevention) and ILM (Information Lifecycle Management). These are more than just fancy terms. These processes apply to anyone that has access to client information, for how long, how data is stored and disposed of, and requires you to show logs and security measures to establish compliance.”
Episode 4 is an update to episode 3 and deals with Short Sale compliance and security issues arising from use of email and the Internet. REALTOR’s handling a short sale with Bank of America will most likely use “Equator” to upload documents which is a secure encrypted and safe website. But, what about your computer at home or the office? What about your Internet connection? If you are like me, you receive documents, some of them sensitive on your cell phone. Is your cell phone secure? Receiving sensitive personal and financial documents on your cell phone extends the end points of your network making it susceptible to hackers.
According to Don Doerr and Doug Farnham of Thomson Conants Mortage Mediation Group “You are responsible for the security of the data you receive from a client, even if you have a third party handle the negotiations and processing. It is imperative that you confirm that any software you use to process or any third party used to process this data meet these requirements.”
For more information about Data collection and how you can protect your clients and yourself, please contact
Don Doerr
Director, Mortgage Mediation Group
602.774.3757
ddoerr@tcmmg.com
REALTOR’s all over Arizona have changed their business models to pursue short sale. It makes sense as up to 65% of all the sales that take place in Maricopa County are distressed sales (short sale or foreclosure).
As a Realtor you are most likely concerned with identifying short sale candidates, marketing and contacting them, finding a buyer and ultimately negotiating a successful short sale. In order to approach the bank with a short sale there are certain things that most agents will collect : pay stubs, tax returns, social security numbers just to name a few.
According to Don Doerr and Doug Farnham of Thomson Conant’s Mortgage Mediation Group, there are compliance regulations that now apply to you and your business as a result of collecting financial information to short sell a property. I was not aware of this either, which is why we chose to make episode 3 of the “BS” Show: “Short Sale and The Security Nightmare” .
Most loan originators are aware of the rules associated with accepting sensitive client information. They do it on a daily basis. Most real estate professionals, however, have not had to deal with compliance regulation and processes such as DSS (Data Security Standard), DLP (Data Loss Prevention) and ILM (Information Lifecycle Management). These are more than just fancy terms. These processes apply to anyone that has access to client information, for how long, how data is stored and disposed of, and requires you to show logs and security measures to establish compliance.
Arizona is in the top 5 states for identity theft. According to Don and Doug, If ID theft is linked back to a leak at your company, you will be required to demonstrate how you have followed all required regulations. You will also need to produce policies and procedures, document and logs to show that regulations were followed. Before you tell yourself this could never happen at your business, think about this; cyber crime is growing at record pace and becoming more sophisticated each day. Even the largest companies with the biggest security budgets have been infiltrated. Although the economic return from hacking your computer may be small by comparison, your computer is an easy target. A hacker will always go after the low-hanging fruit first.
There is no way to guarantee your computer or office has not, or will not be compromised. Compliance is about minimizing that risk and being able to show that you did your due diligence to secure the data in the event of a breach.
Some things to consider even if you don’t store client information on your computer:
Email is not secure.
Do not accept information by email.
Additionally, if your email syncs to your phone you have just extended the endpoints of your data network as these devices should be encrypted.
It is possible to have data stolen from your phone through a blue tooth connection without your knowledge and of course there is always the possibility of losing your phone.
Chat (messaging) programs are also not secure, they store a chat log on your computer, and are a common method hackers use to gain access to, or upload malware to your computer that will monitor your activity.
Many lenders require information be entered into an online system (i.e. Equator). If your computer is compromised this data could be captured by hackers and sold to the highest bidder.
Required Regulations:
Don and Doug remind us “there are many regulations that apply when you start accepting sensitive client data. Most of these contain overlapping requirements. For many companies, following the PCI (Payment Card Industry) requirements covers the minimum requirements for many other regulations. Even if you do not accept or process credit cards, PCI is a well accepted standard and is very clear in its definitions. It is also well supported by numerous software programs for testing and report generation. As an alternative to PCI, ISO27001 is becoming an accepted standard. Because the data collected by a client relate to mortgage origination there are parts of SOX (Sarbanes Oxley) and GLBA (Gramm-Leach-Bliley Act) that could apply. But these last two are not as well defined as PCI or ISO27001 and are somewhat vague as to DSS requirements. FISMA is a government standard released by NIST (National Institute of Standards and Technology) that seems to have some teeth as far as enforcement and penalties.”
You are responsible for the security of the data you receive from a client, even if you have a third party handle the negotiations and processing. It is imperative that you confirm that any software you use to process or any third party used to process this data meet these requirements.
For more information about Data collection and how you can protect your clients and yourself, please contact
Don Doerr
Director, Mortgage Mediation Group
602.774.3757
ddoerr@tcmmg.com
The BS Show took a road trip to Phoenix today to meet with Doug Farnham, Director of Business Development for Thomson Conant Mortgage Mediation Group.
If you are a REALTOR in Arizona that works short sales you have most likely been told that Arizona is a non-deficiency state.
A deficiency judgment is a judgment lien against a debtor, defendant or borrower whose foreclosure sale did not produce sufficient funds to pay the mortgage in full. This option may or may not be available to the lender, depending on whether they have made a recourse or non recourse loan.
In a nutshell, it means that the lender cannot pursue the borrower for the difference between what is owed and what the house sells for in foreclosure. There are of course exceptions to every rule so you should always seek legal advice to see how a short sale or foreclosure will effect you or your client.
We wanted an answer to some of the BS that we (and likely you) have been told regarding whether Arizona is a non-deficiency state and if so, under what scenario(s) would Arizona laws not apply. We have heard different things from different people so we expected a vague answer from Doug as well. We were pleasantly surprised to find that Doug was a wealth of information.
The first thing that became obvious from talking with Doug is that Arizona’s anti deficiency laws are written in regards to foreclosure, not necessarily short sale.
Turns out, Arizona is a recourse state, which means that a lender could sue under certain circumstances for a deficiency. Doug outlined some of those scenarios below for us.
“The Arizona State Statute does not mention the actual words “short sale” so there has been some debate on whether or not short sales are included in the State’s anti-deficiency statues.” Although he has not reviewed the actual case law it was his understanding that this defense has been used successfully in the case of short sales.
Doug says this is why it is best to negotiate a release from future liability with the lender(s) to avoid this entire issue.
We enjoyed talking about short sales with Doug so much that we will be going back to see him next week to discuss next week’s topic: “Short Sales and the Security nightmare, Are You In Compliance?”
Did you know that there are compliance regulations that now apply to you, the REALTOR and your business as a result of collecting financial information to short sell a property? We hope to see you next Friday.
Doug can be reached at:
Doug Farnham
Director of Business Development
Thomson Conant PLC
Mortgage Mediation Group
(C) 602.326.6552
(F) 602.840.3290
email: dfarnham@tcmmg.com
Did you hear the latest Buzz? Its seems there are 2 crazy guys out there in the Phoenix Metro area that are breaking all the barriers when it comes to marketing. What are they doing?
Remember that game you played in high school, maybe college….maybe pre-school (if you were cool) called B.S.? Can’t say what it’s really called here…. {Insert words to play along at home.}
You know the game involving a deck of cards, maybe some beverages and as many players as you choose.
Using the BS format, our show will focus on Short Sales in Arizona. Sample question, “I was told I need an attorney to negotiate a short sale for me, Is this true?”
B.S.! {correct answer and explanation to follow.}
Below is our first episode.
The best part is, unlike TV, the folks at home actually get to participate. We are currently looking for short sale experts to appear on the BS show, (Loan Officers, Accountants, CPA’s, Bank Negotiators, Attorneys etc.).
To the folks at home, email us your questions to BSBlogQuestions@Gmail.com and we will answer them on the B.S. show.
Wondering why we call our show the B.S. Show?
B: Blair Ballin, a local short sale Realtor with Williams Real Estate Company
S: Stephen “MyTitleGuy” Garner, a local Title Rep with a national Title Company.
