Consumers filed 6,573 complaints about deceptive and misleading practices by real estate professionals with the Federal Trade Commission and other agencies in 2008, down 30 percent from the previous year.
Although consumers are still filing more complaints about real estate professionals than they did at the tail end of the housing boom, a dramatic increase seen in 2007 seems to be waning. Consumers filed more than five times as many complaints about real estate professionals in 2007 (9,381) than they did in 2006 (1,804).
Complaints about real estate professionals made up less than 1 percent of the 1.2 million complaints compiled in the Consumer Sentinel Network, a database that includes complaints on file with the FTC, the Internet Crime Complaint Center, Better Business Bureaus, the U.S. Postal Inspection Service, the Identity Theft Assistance Center, and the National Fraud Information Center, and others.
On a list of 30 categories in an FTC report summarizing the latest data, complaints about deceptive and misleading practices by real estate professionals ranked near the bottom, with 24 other issues and industries ranking higher. Topping the list were complaints about identify theft (313,982 complaints), third-party and creditor debt collection (104,642), shop-at-home and catalog sales (52,615), and Internet services (52,102).
The real estate category included complaints about deceptive and misleading practices involving real estate agents and companies, real estate appraisers and appraisal services, real estate consultants, real estate property management, and real estate land developers.
Consumers had more complaints in two other categories often associated with real estate transactions — credit reporting and lending.
The 34,940 complaints associated with credit reporting included claims that credit reporting agencies or those furnishing reports provided inaccurate information, failed to investigate disputed information, or provided inadequate phone help. Consumers also reported difficulties ordering free annual credit reports they are entitled to under the law.
The 22,890 complaints about banks and lenders included reports of deceptive or predatory mortgage lending practices, problems with modification of mortgage terms, and account issues including fees and overdraft charges from national banks.
Mortgage lenders accounted for the largest share of complaints in the category (34 percent) followed by national banks (27 percent). Credit union lending generated the fewest number of complaints of any service provider in the category — 109, or about five one-thousandths of a percent.
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