Wednesday, March 19, 2008

Colorado Brokers Recieve Cease And Desist Orders

Cade Emerson Lee, was issued a cease and desist order by the Colorado Department of Real Estate. This is the first formal action against mortgage brokers accused of violating Colorado’s new lending laws. The Division of Real Estate is also seeking a $20,000 fine against Lee.  In addition, Adriana Arzate‘s license was summarily suspended and the Division is seeking $10,000 in fines asserting that Arzate falsified borrowers’ financial information so they could obtain loans for which they were not qualified. Cease and desist and summary suspensions are emergency measures used when the public’s safety or welfare is in danger, and immediately prohibit the individuals from acting as mortgage brokers.

The Division of Real Estate asserts that Lee, a former stockbroker who was convicted of securities fraud, has been acting as an unregistered mortgage broker in the State of Colorado. Lee, who is on a probationary work release program, was found guilty of securities fraud for cheating a group of elderly investors out of four million dollars in a day trading scam. He was ordered to pay restitution. The new mortgage broker laws prohibit felons convicted of crimes involving fraud, misrepresentation or deceit from becoming licensed as mortgage brokers. Brokering mortgages without a license puts consumers at risk. The new law requires mortgage brokers to obtain surety bonds and errors and omissions insurance to safeguard the public in the event of wrongdoing.

In a separate case, the Division alleges that Adriana Arzate, a licensed Colorado mortgage broker, altered borrowers’ personal information so they could acquire mortgage loans for which they did not qualify. The documents allegedly altered include verification of employment papers, falsified W2s, pay stubs, 1003 and 1008 forms that represented inaccurate incomes and job titles. The Division asserts Arzate violated her duty of good faith and fair dealing.

Governor Ritter signed four mortgage broker bills into law on June 1st, 2007. The new laws, collectively named The Mortgage Broker Licensing Act, were designed to protect consumers from unscrupulous lending practices. The Governor and lawmakers responded to Colorado’s status as having one of the highest foreclosure rates in the country and highest incidence of mortgage fraud. Recent federal proposals incorporate several of Colorado’s statutory provisions. The Director of the Division of Real Estate, Erin Toll, is charged with implementing the new law.

“Combating mortgage fraud and reducing Colorado’s foreclosure rate are my top priorities,” said Erin Toll, Director of the Division of Real Estate. “These are just the first of several actions we intend to take to enforce the new law,” she said.

mortgage fraud

1. Nice!!! Lee did 2 refinances for us - used appraisers that overpriced the value of our home - and represented himself as a mortgage broker.  He should get more than a fine, in my opinion!

   Posted by  on  03/25  at  05:48 PM

2. When he refinanced your home, “not only once but twice” and “Mr. Predatory lender” bad bad mortgage guy, showed you a higher value for your home, why did you still refinance with him??? If you took that additional equity out of the inflated value, and paid off XYZ, then you are just as much a fraud as the company who refinanced you! YOU GOT OVER ON THE SYSTEM AND PUT THE MONEY IN YOUR GREEDY LITTLE POCKETS, SO SHUT UP!
   YOU USED HIM TWICE!!!!!

   Posted by  on  09/27  at  04:09 AM

3. Ya know what Mr. “Truth”? We didn’t know at the time that he was working with the appraisers to increase the reported value - he showed us comps of the area that seemed to agree with the appraiser’s report and we trusted him (our bad). And what did we get over on the system???  We still own our house and are making our payments and, by the way, we only refinanced to get a lower payment and DID NOT TAKE MONEY OUT!!!  What, are you related to this guy or something??!!??

   Posted by  on  09/27  at  05:22 AM

4. Well if he gave you a lower rate and didn’t max you out with his broker fee, max 7% 2.5 to 3 years ago current 4% max
   then the value report being higher than the true market did not affect you in a negative way. I’m not saying what he did was right, only that it had no effect on your life except in a positive way. Unless he gave you a neg interest loan and now you own more than current value. Other wise stop riding the “boo hoo” band wagon!

   Posted by  on  09/27  at  07:20 AM

5. I don’t recall riding the boo hoo wagon and no, our refi didn’t affect us negatively.  It must have been bad for other people though, otherwise why the court actions?  I am simply tired of seeing the public put their trust in people, only to receive a big kick in their collective behinds.  Cade is definetely a slick talker and, to his credit, has taught me to be very wary of anyone offering assistance with anything.  Live and learn, right?

   Posted by  on  09/27  at  01:47 PM