On Oct. 15th, Governor Schwarzenegger signed Assembly Bill 957 into law. This bill protects consumers by ensuring that they have the right to choose t heir own real estate service providers when purchasing foreclosed properties.
This bill prohibits sellers of so-called REO properties — typically properties owned by banks — from requiuring the buyer to use a particular title company, escrow company, or other real estate service provider. This unethical, anti-competitive practice drives up costs for homebuyers and takes business away from locally owned companies.
The bill requires that REO sellers provide a disclosure notice to buyers informing them of their rights to choose their own title, escrow, and other real estate services. Sellers who violate the privisions of this bill are busject to enforcement action by state regulators and liable to buyers for civil penalties.