Robert is a Virginia real estate broker who also serves as a trustee on several deeds of trust for a local lender. One of the borrowers, Angela, has defaulted. The lender instructs Robert to foreclose. Angela contacts Robert and offers him a personal payment to delay the foreclosure sale by 90 days. Robert accepts the payment and delays the sale. Which Virginia law or regulation has Robert most directly violated?
Correct Answer
D) Virginia License Law (Va. Code § 54.1-2100 et seq.) and VREB regulations prohibiting dishonest conduct and conflict of interest
Robert has violated Virginia License Law (Va. Code § 54.1-2100 et seq.) and VREB regulations (18 VAC 135-20) by accepting a personal payment from the borrower to delay the foreclosure sale. As a licensed broker serving as trustee, Robert owes a fiduciary duty to act in the interest of the beneficiary (lender) who appointed him. Accepting a side payment from the borrower creates a direct conflict of interest and constitutes dishonest conduct — both grounds for license discipline under Virginia law. The trustee must act impartially and in accordance with the deed of trust terms.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The debt-to-income ratio (DTI) compares a borrower's monthly debt obligations to their gross monthly income. It is used by lenders to determine how much mortgage a borrower can afford.
In the context of foreclosure, a deed transfers ownership of the foreclosed property to the new owner, typically the buyer at a foreclosure sale.
Discount points are upfront fees paid to a lender at closing to reduce (buy down) the interest rate on a mortgage loan. One point equals 1% of the loan amount and typically reduces the rate by approximately 0.25%.
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