Can a Realtor loan money at 20%?

[Kjerstinsmom]

What is the name of your state? AZ
I have a friend that is going through a divorce. The wife's mother is an agent in AZ and would like to loan the money for the mortgage payments at 20% interest, payable back at the time that they sell the home. She is not disclosing to anyone that she is an agent. Is this legal, ethical, etc.? Isn't there a code of ethics that she is violating?

 

[HomeGuru]

What is the name of your state? AZ
I have a friend that is going through a divorce. The wife's mother is an agent in AZ and would like to loan the money for the mortgage payments at 20% interest, payable back at the time that they sell the home. She is not disclosing to anyone that she is an agent. Is this legal, ethical, etc.? Isn't there a code of ethics that she is violating?

**A: ask her principal broker and check into your state's usury laws.

 

[nextwife]

If the source of funds for a short term loan she is providing is a loan on her credit card, she may very well br PAYING 18% for that money. Nobody is forced to use HER money, if they want a diffgerent source of money, they are free to use a beeter source.

 

[HomeGuru]

If the source of funds for a short term loan she is providing is a loan on her credit card, she may very well br PAYING 18% for that money. Nobody is forced to use HER money, if they want a diffgerent source of money, they are free to use a beeter source.

**A: what is a diffgerent and beeter money source?

 

[Kjerstinsmom]

The money source is being suggested by the agent. It is part of a pending divorce. The mother (agent) and father are looking to loan the money at 20%, which will be charged to my friend. He does not want to agree to this. It is the proposal that is being put together by an attorney. This is they way that they would like to keep the wife in the house for a longer period of time. In a years time, they would like to sell the home and charge my friend the 20%. He does not like the option, but they keep coming up with this type of stuff. Doesn't the agent need to disclose that she is an agent? Is she not held to a higher standard? Is she not acting as a loan-shark?

 

[PghREA]

The money source is being suggested by the agent. It is part of a pending divorce. The mother (agent) and father are looking to loan the money at 20%, which will be charged to my friend. He does not want to agree to this. It is the proposal that is being put together by an attorney. This is they way that they would like to keep the wife in the house for a longer period of time. In a years time, they would like to sell the home and charge my friend the 20%. He does not like the option, but they keep coming up with this type of stuff. Doesn't the agent need to disclose that she is an agent? Is she not held to a higher standard? Is she not acting as a loan-shark?

Just because the mother(agent) wants to loan the money at 20% does not mean that your friend has to accept this loan.

 

[Bigfoot]

The realtor is not listing nor selling the property, so her employment should not be an issue. And there's no guarantee this person would be used to 'list' the property in a year. However your state may have laws that cap the amount of interest can be charged, although I'd expect the attorney already knows this.

As another poster said, the word 'no' is always an option.