California real estate disclosure laws California Real Estate Disclosures | Page 48
the same information as previously described for single lender/purchaser
transactions, as well as the following information:
•
A separate notice of the right to obtain a copy of the appraisal;
•
A written statement from the broker including the analysis of and
support for exceeding the maximum statutory loan-to-value ratios (the
amount of the loan or loans in relationship to the market value of the
security property, which in no event is to exceed 80 percent of the
current fair market value of improved real property or 50 percent of the
current market value of unimproved real property or 65% in those
circumstances where the unimproved real property is zoned single
family residential and all offsite improvements are in place;
NOTE: if the loan is subject to certain defined mortgage insurance
coverage, the foregoing loan-to-value ratio maximums may be exceeded
by the amount of the loan covered by the such insurance;
•
Default and foreclosure procedures for governing the actions of all
holders of interests in the loan by the vote of holders of more than 50
percent of the beneficial interests, excluding any interest held by the
broker or an affiliate of the broker;
NOTE: This requirement must be included in the documentation of the
transaction.
•
The identity of the escrow holder for the transaction; and
•
The right, upon demand, to obtain the names and addresses of the other
lenders or note holders of the loan.
(CAL. BUS. & PROF. § 10238)
3. Construction Loans and Multiple Security Properties in
Multi-Lender Transactions.
As of January 1, 2004, the multi-lender statutory exemption was amended
expanding the ability of a real estate broker to arrange transactions which
would include construction loans and loans with multiple security properties.
Although this expansion provides limited authority, such loan transactions
have become commonplace within the mortgage industry.
The amendments, among others, redefined the phrase “current market value”
which may now be deemed to be the value of the completed project (the
construction, development, or improvements being financed), provided that
the following safeguards are met and appropriate disclosures thereof are
delivered to the lenders or note purchasers:
-41-