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Consumer group gives thumbs up to foreclosure registry

The home next door is an empty foreclosure, the former owner long gone. But when you look up the property online, it's still in the ex-owner's name. And when you check the online court docket, you can't even tell which company foreclosed because the listed plaintiffs are the attorneys at a local law firm that specializes in foreclosure cases.

Whom do you call if the house is falling apart?

A task force made up of financial industry players and homeowner advocates suggested a foreclosure registry -- specifying who purchased the home at auction, who is responsible for maintenance and the name, telephone number and address of both parties. Members noted that it can take months and months before the repossessing financial institution records title to the property and finally shows up in the public records as the owner.

The proposal is before the Senate as HB 1373. The Maryland Consumer Rights Coalition called it a good idea.

"In Maryland, many properties remain in legal limbo for between nine and eighteen months," said Marceline White, executive director of the group, in written testimony. "Consequently, it has been difficult for community members to know how to proceed should a vacant property fall into disrepair or face systems issues -- even if those issues harm adjacent properties."

On that note: Here's a piece about a Baltimore family whose rowhome was damaged by the vacant next door.

The registry wouldn't be a fully public record. You could get contact information for a specific foreclosure only if you own property on the same block or sit on that neighborhood's condo or homeowner association.

A separate proposal that would require foreclosure purchasers (mostly banks) to give the state Department of Assessments and Taxation a heads up is aimed at keeping them from collecting homestead property tax credits during that long limbo period. (The tax break is only for owner-occupiers.) That bill got a favorable vote in committee last week.

In other legislative news, a Senate committee last week spiked a bill that would have changed the heads-up disclosure form homebuyers and sellers get from real estate agents about who's representing whom.

The bill would have added the terms "exclusive buyer agent" and "exclusive seller agent" to the types of agents defined in the form, along with an explanation of what "single agency" means (a real estate brokerage representing only the buyer or the seller in the same transaction) and what a "subagent" is (someone assisting the buyer but employed by the brokerage being used by the seller).

It also would have ramped up a warning in the consent form a buyer and seller are supposed to sign if they end up with same real estate broker, saying "there will likely be a conflict of interest because the interests of the seller and the buyer are different or adverse." (Right now it says "may be a conflict of interest" and "may be different or adverse.")

The bill additionally would have required brokerages to keep the signed disclosure forms to prove they actually gave them to clients. Lack of disclosure, or lack of timely disclosure, is a nationwide problem.

Exclusive buyers' agents -- who work for companies that only represent buyers -- and consumer advocates argued for the change, saying the current system is fraught with conflict-of-interest problems and Marylanders ought to be aware of all their choices. (John F. Sullivan, a Maryland agent who works only for buyers, submitted pieces on agency conflicts of interest from two real estate columnists with their permission -- this one and this one.)

The Maryland Association of Realtors, which opposed the bill, argued that exclusive buyers' agents were just trying to make their business model look best. The trade group, saying the who's-representing-whom issue is already difficult for both agents and clients to understand, contended that the bill would make things worse.

The Senate Education, Health & Environmental Affairs Committee killed the bill on Thursday.

"The Borg wins again," said Sullivan, with Buyer's Edge Co.

Buyers, sellers: Did you get a disclosure form from your agent? Did you understand it?

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