2014 Rules Regulations and Ethics While Marketing to Arizona Home Buyers

Rules, Regulations and Ethics While

Marketing to Home Buyers

Common Methods for

Marketing to Home Buyers

What We Will Discuss Today:

General Requirements for

Brokers and Bankers

Traditional Mail Campaigns

Buying Online Leads

Email Marketing

Online Co-Marketing

Marketing Agreements


Brokers and Bankers

Brokers and Bankers

A.R.S. § 6-909.Q & A.R.S. §6-947. P

A mortgage broker or mortgage banker must reasonably supervise the activities of a loan originator who is licensed and who is employed by the mortgage broker or banker.

A.R.S. § 6-947.D

A person engaged in the mortgage business shall not advertise any false, misleading or deceptive statement or representation with regard to the rates, terms or conditions for a mortgage loan.

R20-4-917. & R20-4-1806.

B. In addition to any statutory requirement regarding records, a record maintained by a mortgage broker or banker shall include the following:

7. Samples of every piece of advertising relating to the mortgage broker’s business in Arizona


Brokers and Bankers

Mortgage Loan Originators Prohibited Acts

A.R.S. § 6-991.02.3

A loan originator acting on the loan originator's own behalf shall not advertise any solicitation of mortgage business.

A.R.S. § 6-991.02.9

A loan originator shall not make a false promise or misrepresentation or conceal an essential or material fact in the course of the mortgage broker or mortgage banker business.

A.R.S. § 6-991.02.14

A loan originator shall not advertise for mortgage business in any manner without all of the following:

(a) The name and license number of the employing mortgage broker, mortgage banker or consumer lender.

(b) Approval of the employing mortgage broker, mortgage banker or consumer lender.

(c) The Unique Identifier that the loan originator maintains with the nationwide mortgage licensing system.


Brokers and Bankers

Reg X: RESPA, Section 8: Kickbacks, Fee-Splitting, Unearned Fees

Any person that gives or receives anything of value (payments, commissions, fees, gifts or special privileges) for the referral of settlement business is in violation of Section 8 of RESPA.

Payments in excess of the reasonable value of goods provided or services rendered are considered unearned fees.

For example: Joint Advertising requires the payment based on prorated use.


Brokers and Bankers

Reg Z: Truth in Lending - Closed-End Advertising

Disclosures required by this section must be made “clearly and conspicuously.” To meet

this standard in general, credit terms need not be printed in a certain type size nor

appear in any particular place in the advertisement. For advertisements for credit secured

by a dwelling, a clear and conspicuous disclosure means that the required information is

disclosed with equal prominence and in close proximity to the advertised rates or

payments triggering the required disclosures.

If an advertisement states a rate of finance charge, it must state the rate as an “annual

percentage rate,” using that term. If the APR may be increased after consummation, the

advertisement must state that fact.

If an advertisement is for credit secured by a dwelling, the advertisement must not state

any other rate, except that a simple annual rate that is applied to an unpaid balance may

be stated in conjunction with, but not more conspicuously than, the APR. That is, an

advertisement for credit secured by a dwelling may not state a periodic rate, other than a

simple annual rate, that is applied to an unpaid balance.

CFPB Supervision Examination Manual


Brokers and Bankers


“Triggering terms” - The following are triggering terms that require additional disclosures:

• The amount or percentage of any down payment;

• The number of payments or period of repayment;

• The amount of any payment; and

• The amount of any finance charge.

An advertisement stating a triggering term must also state the following terms as applicable:

• The amount or percentage of any down payment;

• The terms of repayment, which reflect the repayment obligations over the full term of the loan, including any balloon payment; and

• The “annual percentage rate,” using that term, and, if the rate may be increased after consummation, that fact.



Brokers and Bankers


The regulation prohibits the following seven deceptive or misleading acts or practices in

advertisements for closed-end mortgage loans:

• Stating that rates or payments for loans are “fixed” when those rates or payments can vary without adequately

disclosing that the interest rate or payment amounts are “fixed ” only for a limited period of time, rather than for the

full term of the loan;

• Making comparisons between actual or hypothetical credit payments or rates and any payment or rate available

under the advertised product that are not available for the full term of the loan, with certain exceptions for

advertisements for variable rate products;

• Characterizing the products offered as “government loan programs,” “government-supported loans,” or otherwise

endorsed or sponsored by a federal or state government entity even

though the advertised products are not government-supported or -sponsored loans;

•Displaying the name of the consumer’s current mortgage lender, unless the advertisement also prominently

discloses that the advertisement is from a mortgage lender not affiliated with the consumer’s current lender;

•Making claims of debt elimination if the product advertised would merely replace one debt obligation with another;

•Creating a false impression that the mortgage broker or lender is a “counselor” for the consumer; and

•In foreign-language advertisements, providing certain information, such as a low introductory “teaser” rate, in a

foreign language, while providing required disclosures only in English.



Brokers and Bankers

Unfair, Deceptive, or Abusive Acts or Practices (UDAAP)

An ad is UNFAIR if…

The standard for unfairness in the Dodd-Frank Act is that an act or practice is unfair when:

(1) It causes or is likely to cause substantial injury to consumers;

Substantial injury usually involves monetary harm.

(2) The injury is not reasonably avoidable by consumers;

A key question is not whether a consumer could have made a better choice. Rather, the question is whether an act or practice hinders a consumer’s decision-making.

(3) The injury is not outweighed by countervailing benefits to consumers or to competition.

To be unfair, the act or practice must be injurious in its net effects — that is, the injury must not be outweighed by any offsetting consumer or competitive benefits that also are produced by the act or practice. Offsetting consumer or competitive benefits of an act or practice may include lower prices to the consumer or a wider availability of products and services resulting from competition.



Brokers and Bankers


An ad is DECEPTIVE if…

(1) The representation, omission, act, or practice misleads or is likely to mislead the consumer;

(2) The consumer’s interpretation of the representation, omission, act, or practice is reasonable under

the circumstances; and

(3) The misleading representation, omission, act, or practice is material.



Brokers and Bankers


DECEPTIVE – Likely to Mislead

It is necessary to evaluate an individual statement, representation, or omission not in isolation, but

rather in the context of the entire advertisement … to determine whether the overall net impression is

misleading or deceptive. A representation may be an express or implied claim or promise. If material

information is necessary to prevent a consumer from being misled, it may be deceptive to omit that

information.

Written disclosures may be insufficient to correct a misleading statement or representation, particularly

where the consumer is directed away from qualifying limitations in the text or is counseled that reading

the disclosures is unnecessary. Likewise, oral or fine print disclosures or contract disclosures may be

insufficient to cure a misleading headline or a prominent written representation. Similarly, a deceptive

act or practice may not be cured by subsequent truthful disclosures.

Acts or practices that may be deceptive include: making misleading cost or price claims; offering to

provide a product or service that is not in fact available; using bait-and-switch techniques; omitting

material limitations or conditions from an offer; or failing to provide the promised services.



Brokers and Bankers


DECEPTIVE – Likely to Mislead

The FTC’s “four Ps” test can assist in the evaluation of whether a representation, omission, act, or

practice is likely to mislead :

Is the statement prominent enough for the consumer to notice?

Is the information presented in an easy-to-understand format that does not contradict other

information in the package and at a time when the consumer’s attention is not distracted

elsewhere?

Is the placement of the information in a location where consumers can be expected to look or

hear?

Finally, is the information in close proximity to the claim it qualifies?



Brokers and Bankers


DECEPTIVE – Consumers’ Interpretation

In determining whether an act or practice is misleading, one also must consider whether the

consumer’s interpretation of or reaction to the representation, omission, act, or practice is reasonable

under the circumstances. In other words, whether an act or practice is deceptive depends on how a

reasonable member of the target audience would interpret the representation. When representations

or marketing practices target a specific audience, such as older Americans, young people, or

financially distressed consumers, the communication must be reviewed from the point of view of a

reasonable member of that group.

Moreover, a representation may be deceptive if the majority of consumers in the target class do not

share the consumer’s interpretation, so long as a significant minority of such consumers is misled.

When a seller’s representation conveys more than one meaning to reasonable consumers, one of

which is false, the seller is liable for the misleading interpretation.

Exaggerated claims or “puffery,” however, are not deceptive if the claims would not be taken seriously

by a reasonable consumer.



Brokers and Bankers


DECEPTIVE – Must be Material

A representation, omission, act, or practice is material if it is likely to affect a consumer’s choice of, or

conduct regarding, the product or service. Information that is important to consumers is material.

Certain categories of information are presumed to be material. In general, information about the

central characteristics of a product or service – such as costs, benefits, or restrictions on the use or

availability – is presumed to be material. Express claims made with respect to a financial product or

service are presumed material. Implied claims are presumed to be material when evidence shows that

the institution intended to make the claim (even though intent to deceive is not necessary for deception

to exist).

Claims made with knowledge that they are false are presumed to be material. Omissions will be

presumed to be material when the financial institution knew or should have known that the consumer

needed the omitted information to evaluate the product or service.



Brokers and Bankers


Example - Misrepresentation about loan terms.

In 2004, the FTC sued a mortgage broker advertising mortgage refinance loans at “3.5% fixed

payment 30-year loan” or “3.5% fixed payment for 30 years,” implying that the offer was for a 30-year

loan with a 3.5% fixed interest rate. Instead, the FTC claimed that the broker offered adjustable rate

mortgages (ARMs) with an option to pay various amounts, including a minimum monthly payment that

represented only a portion of the required interest. As a result, unpaid interest was added to the

principal of the loan, resulting in negative amortization.

• Practice likely to mislead. The FTC claimed that the advertisements were misleading because they compared payments on

a mortgage that fully amortized to payments on a non-amortizing loan with payments that increased after the first year. In

addition, the FTC claimed that after application, the broker provided Truth in Lending Act (TILA) disclosures that misstated the

annual percentage rate (APR) and that failed to state that the loan was a variable rate loan.

• Reasonable consumer perspective. It was reasonable for consumers to believe that they would obtain fixed-rate mortgages,

based on the representations.

• Material representation. The representations were material because consumers relied on them when making the decision to

refinance their fully amortizing 30-year fixed loans. As a result, the consumers ended up with adjustable rate mortgages that

would negatively amortize if they made payments at the stated 3.5% payment rate.

FTC v. Chase Financial Funding, Inc., No. SACV04-549 (C.D.Cal. 2004), Stipulated Preliminary Injunction, available at http://www

ftc.gov/os/caselist/0223287/0223287.shtm



Brokers and Bankers

Use of HUD/FHA Logo, Name and Acronym in Advertising

Mortgagee Letter 2011-17

This Mortgagee Letter communicates requirements to mortgagees regarding the use of the official logos, names and acronyms of the U.S. Department of Housing and Urban Development (HUD or the Department) and the Federal Housing Administration (FHA) within devices used to advertise or promote the business products or operations of FHA-approved mortgagees.

… a “Device” constitutes a channel or instrument for soliciting, promoting or advertising FHA products or programs.

Under §§ 202 and 536 of the National Housing Act (NHA), HUD may impose sanctions, including civil money penalties, for misuse of the terms

“Federal Housing Administration,”

“Department of Housing and Urban Development,”

“Government National Mortgage Association,”

“Ginnie Mae,”

the acronyms “HUD,” “FHA,” or “GNMA,”

or any official seal or logo of the Department of Housing and Urban Development.


Brokers and Bankers

Use of FHA Logos

FHA-approved mortgagees may display the official FHA Approved Lending Institution logos on a

Device for the purpose of describing … the types of loan products offered by the mortgagee.

… must be displayed in a discreet manner.

… must, in each instance, be accompanied by a conspicuous disclaimer that clearly informs the

public that the mortgagee authoring the Device is not acting on behalf of or at the direction of

HUD/FHA or the Federal government.

The disclaimer should be prominently displayed in a location proximate to where the FHA Approved

Lending Institution logo(s) is displayed.


Brokers and Bankers

Official FHA Approved Lending Institution Logos

FHA-approved mortgagees may display the official FHA Approved Lending

Institution logos on a Device for the purpose of describing … the types of

loan products offered by the mortgagee.

… must be displayed in a discreet manner.

… must, in each instance, be accompanied by a conspicuous disclaimer that

clearly informs the public that the mortgagee authoring the Device is

not acting on behalf of or at the direction of HUD/FHA or

the Federal government.

The disclaimer should be prominently displayed in a location proximate to

where the FHA Approved Lending Institution logo(s) is displayed.


Brokers and Bankers

Use of FHA Logos

The Device, when taken as a whole, shall emphasize the HUD-registered business name, alias or

d/b/a of the mortgagee and not the Federal government.

… the Device shall be written, formatted and structured in a manner which clearly identifies the

mortgagee as the sole author and originator of the Device. Specifically, the Device should reflect the

mortgagee’s name, location and appropriate contact information.

… strictly prohibited from displaying the official FHA Approved Lending Institution logo(s) in a location

or manner within a Device that creates the false impression that the Device is an official government

form, notice or document or that otherwise conveys the false impression that the Device

is authored, approved, or endorsed by the Department or FHA.

Furthermore, alteration or modification of the FHA Approved Lending Institution logo(s) is strictly

prohibited.


Brokers and Bankers

Use of FHA Logos

Moreover, use of the FHA logo is strictly prohibited. No person, party, company, or firm, including FHA-

approved mortgagees, may use the FHA logo.

Cannot Use

Use of HUD SealFHA-approved mortgagees, non FHA-approved mortgagees and Third Party

Originators are not permitted to display the official HUD seal or any other insignia that imitates an

official Federal seal on any Device.

Cannot Use


Brokers and Bankers

Use of HUD/FHA Names and Acronyms

FHA-approved mortgagees may not purport or imply that as a result of their approval to participate in

FHA programs that their business products or services are coming directly from HUD or FHA.

The use of the words “federal,” “government,” “national,” “U.S. Department of Housing and

Urban Development,” “Federal Housing Administration,” and/or the letters “HUD” or “FHA”

… in a manner that falsely represents that the mortgagee’s business services or products originate

from HUD, FHA, the Government of the United States, or any Federal, State or local government

agency is strictly prohibited.

Must retain copies of any Device related to FHA programs for a two years.

Failure to follow HUD/FHA requirements as outlined in this Mortgagee Letter may result in sanctions,

including civil money penalties or administrative action against any person, party, company, firm,

partnership or business, including non FHA-approved institutions and individuals.


Brokers and Bankers

Ethics - Questions to Consider

Does your advertising make your customers satisfied that they do business with you?

Is your advertising easy to understand without asterisks and fine print?

Are you avoiding impossible promises and guarantees?

Are your advertised programs readily available?

Do you mean to sell what you advertise?

Do your ads avoid misleading inferences?

Do your advertised terms agree with the facts?

Do you believe your own comparatives?

CFPB Warnings and Actions

http://www.consumerfinance.gov/newsroom/consumer-financial-protection-bureau-warns-

companies-against-misleading-consumers-with-false-mortgage-advertisements/

http://themreport.com/news/government/08-12-2014/atlanta-lender-pay-19-3m-alleged-bait-switch


Arizona’s Trade and Commerce Laws Pertaining to Loan Information and Solicitations

(ARS 44-1799.51.)

A. A person shall not reference the trade name or trademark of a lender or a trade name or trademark

confusingly similar to that of a lender in a solicitation for the offering of services or products without the

consent of the lender unless the solicitation clearly and conspicuously states all of the following in

close proximity to and in the same or larger point type as the first and the most prominent use of a

lender's trade name or trademark in the solicitation:

1. The name, address and telephone number of the person making the solicitation.

2. That the person making the solicitation is not affiliated with the lender.

3. That the solicitation is not authorized or sponsored by the lender.

4. That the loan information referenced was not provided by the lender.



(ARS 44-1799.51.)

B. A person shall not reference a loan number, loan amount or other specific loan information that is

not publicly available in a solicitation for the purchase of services or products, except that this

prohibition does not apply to communications by a lender or its affiliates with a current customer of the

lender or with a person who was a customer of the lender during the eighteen months immediately

preceding the solicitation.

C. A person shall not reference a loan number, loan amount or other specific loan information that is

publicly available in a solicitation for the purchase of services or products unless the communication

clearly and conspicuously states all of the following in close proximity to and in the same or larger

point type as the first and the most prominent use of a loan number, loan amount or other specific loan

information that is publicly available in the solicitation:

1. The name, address and telephone number of the person making the solicitation.

2. That the person making the solicitation is not affiliated with the lender.

3. That the solicitation is not authorized or sponsored by the lender.

4. That the loan information referenced was not provided by the lender.


Arizona’s Trade and Commerce Laws Pertaining to Loan Information and Solicitations (ARS 44-1799.51.)

D. Subsection C does not apply to communications by a lender or its affiliates with a current customer of the lender or with a person who was a customer of the lender during the eighteen months immediately preceding the solicitation.

E. A person shall not use the name of a lender or a name similar to that of a lender in a solicitation directed to consumers if that use could cause a reasonable person to be confused, mistaken or deceived as to either of the following:

1. The lender's sponsorship, affiliation, connection or association with the person using the name.

2. The lender's approval or endorsement of the person using the name or the person's services or products.

F. Any reference to an existing lender, a loan number, loan amount or other specific loan information that appears on the outside of an envelope, that is visible through the envelope window, or that appears on a postcard in connection with any written communication that includes or contains a solicitation for goods or services is prohibited without the consent of the existing lender.

G. It is not a violation of this section for a person to use the trade name of another lender in an advertisement for services or products to compare the services or products offered by the other lender.



(ARS 44-1799.51.)

H. A lender or owner of a trade name or trademark may seek an injunction against a person who

violates this section to stop the unlawful use of the trade name, trademark or loan information. The

person seeking the injunction shall not have to prove actual damage as a result of the violation.

Irreparable harm and interim harm to the lender or owner shall be presumed. The lender or owner

seeking the injunction may seek to recover actual damages and any profits the defendant has accrued

as a result of the violation. The prevailing party in any action brought pursuant to this section is entitled

to recover costs associated with the action and reasonable attorney fees from the other party.

I. For the purposes of this section, "lender" means a bank, national bank doing business in this state,

industrial bank, savings and loan association, savings bank, credit union, finance company, mortgage

bank, mortgage broker, loan originator or holder of the loan or other person who makes loans in this

state and any affiliate, or any third party operating with the consent of the lender.


Example 1:


Example 2:

Buying Online Leads

Buying Online Leads

A. A. C. R20-4-102.

11. “Directly or indirectly makes, negotiates, or offers to make or negotiate” and “Directly or indirectly

making, negotiating, or offering to make or negotiate,” as those phrases are used in A.R.S. §§ 6-901,

6-941, or 6-971, mean:

a. Providing consulting or advisory services in connection with a mortgage loan transaction,

mortgage banking loan transaction, or commercial mortgage loan transaction;

i. To an investor, concerning the location or identity of potential borrowers, regardless of

whether the person providing consulting or advisory services directly contacts any potential

borrowers; or

ii. To a borrower, concerning the location or identity of potential investors or lenders; or

b. Providing assistance in preparing an application for a mortgage loan transaction, mortgage

banking loan transaction, or commercial mortgage banking loan transaction, regardless of whether

the person providing assistance directly contacts any potential investor or lender;

Buying Online Leads

Company Name Lic #

Bills.com, LLC 917704

Erate.Com, Inc. 909410

FreeRateUpdate.com LLC 927475

Full Beaker, Inc. 923564

LendingTree, LLC #1 902469

LMB Mortgage Services, Inc. 918276

QuinStreet Media, Inc. 908346

Secure Rights Inc. (FN) 907329

Example list from azfdi.gov (not all inclusive) of compliant lead generation companies.

Email Marketing

CAN-SPAM Act

The CAN-SPAM Act, a law that sets the rules for commercial email, establishes requirements for

commercial messages, gives recipients the right to have you stop emailing them, and spells out tough

penalties for violations.

Despite its name, the CAN-SPAM Act doesn’t apply just to bulk email. It covers all commercial

messages, which the law defines as “any electronic mail message the primary purpose of which is the

commercial advertisement or promotion of a commercial product or service,” including email that

promotes content on commercial websites. The law makes no exception for business-to-business

email. That means all email – for example, a message to former customers announcing a new product

line – must comply with the law.

Each separate email in violation of the CAN-SPAM Act is subject to penalties of up to $16,000, so non-

compliance can be costly. But following the law isn’t complicated.

Email Marketing

CAN-SPAM Act – Main Requirements

Don’t use false or misleading header information. Your “From,” “To,” “Reply-To,” and routing

information – including the originating domain name and email address – must be accurate and

identify the person or business who initiated the message.

Don’t use deceptive subject lines. The subject line must accurately reflect the content of the

message.

Identify the message as an ad. The law gives you a lot of leeway in how to do this, but you must

disclose clearly and conspicuously that your message is an advertisement.

Tell recipients where you’re located. Your message must include your valid physical postal address.

This can be your current street address, a post office box you’ve registered with the U.S. Postal

Service, or a private mailbox you’ve registered with a commercial mail receiving agency established

under Postal Service regulations.

Email Marketing

CAN-SPAM Act – Main Requirements

Tell recipients how to opt out of receiving future email from you. Your message must include a

clear and conspicuous explanation of how the recipient can opt out of getting email from you in the

future. Craft the notice in a way that’s easy for an ordinary person to recognize, read, and understand.

Creative use of type size, color, and location can improve clarity. Give a return email address or

another easy Internet-based way to allow people to communicate their choice to you. You may create

a menu to allow a recipient to opt out of certain types of messages, but you must include the option to

stop all commercial messages from you. Make sure your spam filter doesn’t block these opt-out

requests.

Honor opt-out requests promptly. Any opt-out mechanism you offer must be able to process opt-out

requests for at least 30 days after you send your message. You must honor a recipient’s opt-out

request within 10 business days. You can’t charge a fee, require the recipient to give you any

personally identifying information beyond an email address, or make the recipient take any step other

than sending a reply email or visiting a single page on an Internet website as a condition for honoring

an opt-out request. Once people have told you they don’t want to receive more messages from you,

you can’t sell or transfer their email addresses, even in the form of a mailing list. The only exception is

that you may transfer the addresses to a company you’ve hired to help you comply with the CAN-

SPAM Act.

Monitor what others are doing on your behalf. The law makes clear that even if you hire another

company to handle your email marketing, you can’t contract away your legal responsibility to comply

with the law. Both the company whose product is promoted in the message and the company that

actually sends the message may be held legally responsible.

Email Marketing

Gramm-Leach-Bliley Act (GLB Act)

Provisions are aimed at protecting the privacy of consumers’ Nonpublic Personal Information (NPI)

held by financial institutions from unauthorized access and disclosures.

The specific requirements for compliance are stated in the FTC (Federal Trade Commission)

Safeguards Rule.

The Safeguards Rule requires all financial institutions to design, implement, and maintain safeguards

to protect customer information while it is in the custody and control of the institution and its agents.

A written Safeguards Policy must include provisions that:

• Ensure the security and confidentiality of customer records,

• Protect against any anticipated threats or hazards to the security of such records.

• Protect against the unauthorized access or use of such records or information in ways that

could result in substantial harm or inconvenience to customers.

Email Marketing

Gramm-Leach-Bliley Act (GLB Act)

People have this notion that the contents of emails can only be viewed by the sender and the

recipient.

However, when you send out an email, copies of the message may be stored in your computer, in the

recipient’s computer, in your email server, and in the recipient’s email server. If the email was sent to

more than one person, then that means the message may have copies in their computers and their

email servers as well.

Co-Marketing & RESPA

Understanding “Anything of Value”

a thing of value may include any payment, advance, fund, loan, service, or other consideration

offered in exchange for business referrals.

The term ‘‘payment’’ is used throughout § 1024.14 and 1024.15 as synonymous with the giving

or receiving of any ‘‘thing of value’’ and does not require transfer of money.

Marketing Agreements/Advertising Fees with Real Estate Agents

The key provision of this section that keeps co-advertising expense, co-marketing expense, and other

joint ventures from being classified as RESPA Section 8 violations is all parties paying their

proportionate costs of the joint marketing.

Any payment by the MLO that is greater than their proportionate share of the cost of the advertising is

considered “something of value” in exchange for referral business.

Compliance risk arises in situations where the laws or rules

governing certain activities may be ambiguous or untested.

Online Co-Marketing

http://youtu.be/tXH1IIC-ZI8

Online Co-Marketing

Zillow Marketplace

http://www.zillow.com/help/zillow-co-marketing/

http://www.zillow.com/comarketing/faq/

http://www.zillow.com/help/zillow-co-marketing/

http://www.zillow.com/comarketing/faq/

Online Co-Marketinghttp://ceforward.com/2014/05/zillows-co-marketing-program-may-or-may-not-violate-respa/

Zillow and Trulia are nonbrokers and charge by impressions or a percentage of traffic in a ZIP code.

http://www.inman.com/next/the-elephant-in-the-room-with-zillows-acquisition-of-trulia-is-mortgages/

http://ceforward.com/2014/05/zillows-co-marketing-program-may-or-may-not-violate-respa/

http://www.inman.com/next/the-elephant-in-the-room-with-zillows-acquisition-of-trulia-is-mortgages/

Online Co-Marketing

Co-Branded Video Marketing

http://www.inman.com/next/co-branded-video-marketing-how-realtors-and-lenders-can-combine-efforts-costs-and-results-to-grow-their-business/

Online Co-Marketing

Real Estate Marketing Software

“Everybody wins when you share BoomTown with your trusted real estate partners.”

http://boomtownroi.com/features/co-marketing/

Owned by Move, Inc.

“Co-market with mortgage lenders who share access to a TigerLead license with an agent. Our PAWS

dashboard allows for easy collaboration between agents and mortgage lenders.”

http://www.tigerlead.com/about/our-story/

http://www.inman.com/2013/08/02/move-leads-to-real-estate-pros-up-50/

http://boomtownroi.com/features/co-marketing/

http://www.tigerlead.com/about/our-story/

http://www.inman.com/2013/08/02/move-leads-to-real-estate-pros-up-50/

Online Co-Marketing

Real Estate Marketing Software

http://www.listingbooster.com/

http://www.marketleader.com

http://www.domoreloans.com/

http://youtu.be/13NP7a37k_0

http://www.listingbooster.com/

http://youtu.be/13NP7a37k_0

Online Co-Marketing

Compliance and Ethical Considerations

RESPA – Who is paying for the service?

Steering – Is the agent steering the borrower to one lender?

Exclusivity – Who has access to the CRM? Are the leads exclusive to one lender?

Misrepresentation – Who does the customer think is calling them when they inquire about a home for

sale? Are they expecting a loan officer to call when they request information about a home?

Unlicensed Activity – Is the loan officer performing duties that require a real estate license?

Other Considerations …

Marketing Services Agreement

What is a Marketing Services Agreement?

Arrangements by which a lender paid a broker or other third party for bona fide marketing

services.

Key points to consider when entering into a MSA:

Limit the services the real estate office is providing to advertising/marketing. The MSA

should not identify service or base compensation on business or referrals generated. Essentially,

the real estate office is being hired to advertise the services of the other entity; limit your services

to advertising.

Avoid exclusivity provisions. CFPB investigators typically review “exclusive access provisions”

as referral arrangements that are intended to lock-out competitors. Anything that hints at being

anti-competitive will raise red flags for an investigator and will suggest a potential RESPA violation.

It is also a good idea to avoid agreements that give the Provider exclusive access to your

licensees. Attending sales meetings or awards banquets, or otherwise including opportunities for a

title officer or mortgage broker to speak about products to real estate agents, will, more often than

not, be seen as a referral arrangement that violates RESPA.


Key points to consider when entering into a MSA

Lease agreements should be separate from MSAs. The lease agreement should stand separate

and distinct from the MSA. Lease agreements are easy to analyze and any investigator will quickly

ascertain that your lease agreement does – or does not – charge rent commensurate to the fair

market value of the leased space.

Value your marketing services objectively. This is probably the most difficult aspect of MSAs.

Sharing advertising space and passing along prorated advertising costs to the Provider are

aspects of MSAs that are easy to value. However, undertaking email campaigns, either including or

on behalf of the Provider, or offering other “generic” marketing services are much more difficult to

value. Industry experts suggest hiring an auditing or actuarial company to provide objective

analyses and valuations of marketing services.

Tracking services. If a real estate office is being paid for services that it is not performing, then the

real estate office and the company paying the real estate office are both violating RESPA. It is

important to develop a matrix by which services rendered will be measured, objectively, so that

both the real estate office and the company paying for the services can track what is being done

and whether the services are being performed in accordance with the expectations laid out in the

MSA.

http://www.parjustlisted.com/key-points-to-consider-when-entering-into-a-

msa/


http://rismedia.com/2014-04-02/consumer-financial-protection-bureau-aggressive-on-respa/

http://rismedia.com/2014-04-02/consumer-financial-protection-bureau-aggressive-on-respa/

2014 Rules Regulations and Ethics While Marketing to Arizona Home Buyers

Real Estate

Transcript of 2014 Rules Regulations and Ethics While Marketing to Arizona Home Buyers