Compromise reached on Assembly Bill 957 is also called “The Buyer's Choice Act”

The CA Association of REALTORS just released information on Assembly Bill 957, also called "The Buyer's Choice Act". The bill, authored by Assemblywoman Galgiani, will require fair treatment for real estate owned (REO) buyers in the choice of title and escrow providers. Here is an excerpt form the e-mail sent out minutes ago by the CA Association:

C.A.R. Achieves Compromise in AB 957,

Choice of Escrow Bill

C.A.R. achieved a compromise in AB 957, "Choice of Escrow Bill." In multiple discussions with the author, C.A.R. worked with Assemblywoman Galgiani, to come up with compromise language that will require fair treatment for real estate owned (REO) buyers in the choice of title and escrow providers.

The new language now protects fair negotiation over settlement services, and has removed C.A.R.'s opposition.

The new language will codify in California law the federal RESPA rules for selection of title insurance, and extend the same rules to protect buyers in the selection of escrow services. In a nutshell, the sellers will have to negotiate the selection of title and escrow. Under the new language, if an REO seller wants to try and direct choice of escrow, the seller will have to pay for the privilege.

AB 957 will also impose new penalties on REO sellers that violate the law, and will empower state regulators to go after both RESPA and "steering" violations.

This has been an on-going issue in CA where many banks have been "steering" buyers into using the banks preferred escrow company even when a local option existed and in many cases was less expensive. There was also a groundswell of opinion among real estate agents and brokers that offers submitted to banks were not getting a fair shake if they objected to using these preferred services. For more background on this bill visit:

http://democrats.assembly.ca.gov/members/a17/Pressroom/Press/20090420AD17PR01.aspx