Fraud in print advertising

[AgentBill]

This only effects a small segment of what we do, but it still really gets on my nerves when I read ads in newspapers or classified publications that are blatantly false. This doesn't bother me like it did when I started and was scrounging for first time buyers, and actually lost a few of them to ads that promised properties for 1/3 of what they really go for. Or foreclosure, fixer opportunities, or PITI numbers that did not exist. But it still annoys me, particularly when another office in my franchise does it, and I have to explain to someone how not only is the ad false, but I have no connection to that company, despite the fact that we wear the same name badge.

Does anyone else see this in their markets?

Does anyone else think we are setting ourselves up for goverment regulation if this continues on?

Even though the sellers market is gone in Socal, I can pick up the major newspaper of record in the area, look at a full or two page, full color ad from any major franchise, and usually find what I'm talking about.

[Homesurfer]

NOTE: You're not allowed to put PITI numbers in an advertisement without including an APR (Annual Percentage Rate).

[sdhomes]

Since Terry and I date back to the days of print being the main medium for real estate and mortgage advertising, I expected him to make the point about APR.

We are already under a lot of government regulation, but too many of the newbies (5 years or less experience) dont seem to know or care.

In California, print ads were policed regularly. As things moved online and people didnt realize that most of the old laws still applied (copyright, truth in advertising, RESPA, etc) and they published (yes, its STILL publishing) without regard to the law, they also seemed to then apply their standards to print.

If you are in the US, this is still serious, especially with regard to lending. As the market continues to drop, the lawsuits will steadily rise, both from consumers and are dear old forgotten RESPA friends. Send a copy of the ads to your company's broker AND legal counsel and let them know a complaint will be filed with whatever entity is charged with enforcing these laws.

We need to hold our industry accountable ourselves.

[AgentBill]

Thanks Homesurfer, I know, and should have qualified that by saying more often when PITI numbers are messed with, it more often falls under the heading of misleading advertising and not outright fraud. Plus there are armies of lawyers out there looking for agents or LOs that miss some necessary element in their advertising.

As far as the other areas go, the problem is that most agents either don't take notice of it, for now, or don't care. And that's what worries me a bit.

The print and online problems frequently can't be caught by lawyers that don't know what something in a given area costs, and advertising a price that is patently ridiculous, or was a real list price on the house sometimes pictured.. on a sale five years ago, will slip by.

The online issues I see most often fall into two categories; area and size. The ability to put down an estimated square footage is something I ran afoul of just this morning, when a 1027 square foot condo was listed as 1500. I looked at the price though and ran the tax roles and previous sales on the same property, and saw the actual number.

With regard to area, putting down the wrong area in a listing to attract buyers looking for more desireable areas is absolutely rampant where I work. And no amount of policing can fix this, because it is accepted as too easy for someone to claim "I didn't know". In Long Beach and Lakewood, there are 34 different named regions, some with subdivisions beneath them, and some that exist on different sides of where the two towns border under. For example, in "Old Lakewood", one of the areas I work, 47 out of 50 listings are actually in different tracks. Only 3 are correctly labeled. That can be explained off because of the name is similar to the city. However in the more desireable Eastern half of Long Beach, every region has listings that are actually in the Western half, and that can't be explained so easy when it's easy to figure out what region something should actually be in.

OK I'm off my soapbox, but as I said and as I'm sure is obvious, this is something that really gets on my nerves.

[NealRM]

I guess I am luckly. As a publisher, we have not had an issue with realtors falsifying information. The price is almost always correct and the sqft is correct within reason. The worst I have seen is stretching were the property is located. Stating the property is 5 to 10 minutes from town when it's really 8 to 10 miles.

But, we live is a smaller city. If a realtor were to start publishing false information, it would get around.