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June 2007
Index of all
past
Affiliate Corner columns
When you need it, will you have it?
By Tom Gross,
Loan Originator and AAR Speakers Committee Chairman
I believe that we do a good job of emphasizing our ethical standards, but we can’t avoid articles with headlines like these:
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“Real estate agent gets 4 years for fraud,” Rocky Mountain News, June 9, 2006.
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“Guilty plea in fraud probe – Mortgage scheme ravaged upscale Aurora neighborhood with foreclosures,” Denver Post, Jan. 11, 2007 (it featured a photo of one of our own Affiliate members).
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“Sharks in the Housing Pool,” BusinessWeek online, Sept. 5, 2005.
In most of these scams, there are multiple participants. There were eight others guilty with the real estate agent from last June and a total of eight convictions from the mortgage scheme in January. In the “Sharks” article, the FBI predicted 20,000 fraud cases in 2005.
What shall we do? A starting off point would be looking in the mirror and reexamining our personal code of ethics.
I’ve addressed various aspects of this subject with past AAR directors and presidents, current leaders and successful REALTORS®. While I do not question the premise that a listing agent represents the seller exclusively and can’t be held responsible for the ethics or arrangements made by a buyer or selling agent, I do question the wisdom of recommending acceptance of contracts that call for massive repairs to never lived in properties with escrow proceeds going to XYZ, LLCs at closings without oversight. Wow – what a mouthful! Are we so caught up in getting the deal done, making our paycheck and moving on to the next deal that we simply don’t have a true compass for our industry? Would our appraisers be under less pressure today if there hadn’t been as much fraud in 2005? Would our local market be in better or worse shape if the title company blew a whistle rather than insuring those purchases that “ravaged” the upscale Aurora neighborhood? What do the innocent neighbors of that scheme think?
I simply recommend that each of us (REALTORS®, lenders, appraisers, insurance agents, inspectors, and any other AAR Affiliates) present ourselves and our services with a goal of arranging win-win transactions that can withstand the judgment of time. If our customers do not return and refer new customers, we should leave this industry.
What is it? Courage – the courage to even stand alone and say something isn’t right when you know it isn’t right. I grew up in a place where some people could boil things down to a bottom line in a few words. When an obvious scam comes along, the good ole boys of North Alabama might say “It doesn’t matter how much lipstick you put on a pig’s lips, it’s still a pig.”
When you need it, I hope you’ll have it, because if you don’t have it you can’t use it. To quote the English novelist C. S. Lewis, “Courage is not simply one of the virtues, but the form of every virtue at the testing point.”
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