Catching Up on Hot Topics

With the end of the year rapidly approaching, it’s time to catch up on a few of the hottest topics this column covered since the first of the year. 

In a July Housing Scene column, I took apart an outfit called Home Title Lock for charging homeowners for “monitoring” their titles – which owners could do themselves, often for free – and for exaggerating the breadth of the crime. 

Not that title theft doesn’t happen. It does, and in a few spots, it is rampant. As a first step toward stopping the crime, two Democratic lawmakers – Reps. Emanuel Cleaver of Missouri and Dwight Evans of Pennsylvania – dropped a bill that would establish the first federal definition of deed fraud, as well as sentence those who commit it. 

The Good DEED Act (for Good Documentation and Enforcement of Estate Deeds) also would establish a $10 million annual fund to assist states in the prevention, detection, investigation and prosecution of title theft. Any jurisdiction receiving funds would be required to fingerprint, photograph and video anyone filing a deed. 

Boston Targeted for Money Laundering 

In January, I covered Uncle Sam’s efforts to end money laundering through real estate. Now, the government is once again expanding the rules that require title companies to identify individuals who purchase residential real estate for cash through shell companies when the deal exceeds $300,000. 

The Financial Crimes Enforcement Network, or FinCEN, has now renewed the program and added the counties encompassing Houston and Laredo, Texas, to the list of 20 other jurisdictions where title agents must comply. 

The other places include Greater Boston and the counties within these metropolitan areas: Chicago, Dallas-Fort Worth, Honolulu, Las Vegas, Los Angeles, Miami, New York City, San Antonio, San Diego, San Francisco, Seattle and the District of Columbia. Also included are the city and county of Baltimore; Fairfield County, Connecticut; and the Hawaiian islands of Maui, Hawaii and Kauai. 

According to FinCEN, the program has provided “valuable data” on the purchase of residential real estate by persons possibly involved in various illicit enterprises. 

40-Year Listing Contracts 

Most recently, I wrote about MV Realty, which is luring homeowners into 40-year listing contracts by offering them a small stipend in cash. In October, I reported that the Florida firm is paying up to $5,000, based on the value of the house, to owners who sign a four-decade listing agreement that most don’t realize will be recorded as a lien against the property. 

Now, regulators in North Carolina, as well as the state real estate commission, are investigating the company to discern whether the agreements constitute predatory lending. Other state attorneys general are also said to be looking into the firm. 

Meanwhile, a Maryland homeowner whose wife was cold-called by MV Realty – despite the company’s claims that it doesn’t contact anyone who doesn’t reach out first – and his attorney have succeeded in convincing the company to release its lien on the property. The homeowner reached out to this column. 

The man and his family had just moved into their new house when his wife was offered $1,500 to sign a listing agreement. She agreed, but he didn’t know about it until a notary showed up at the door to collect their signatures. He said thanks, but no thanks. 

“We had just moved in, so we had no need for an agent,” he told me on the condition that his name not be used.  

At the same time, Sherryll Martens Dunaj, an attorney with Simon, Schindler and Sandberg in Miami, believes she’s the first to challenge MV Realty on legal grounds and win. Her clients, the heirs of the homeowner, were trying to sell his residence after he had died. 

Dunaj said she had another client who decided not to challenge his contract with MV because it was cheaper to pay the company’s commission than to incur the legal costs of going to court. 

The Maryland man agreed to speak with me because he feared people who signed up with MV “could lose their houses.”  

And lawyer Dunaj believes the company is “laying in wait” for people who violate their agreements by selling their homes using other agents. 

“These are very bad people,” she said. 

Lew Sichelman has been covering real estate for more than 50 years. He is a regular contributor to numerous shelter magazines and housing and housing-finance industry publications. Readers can contact him at [email protected].