Pegasis, Inc.

Representatives of foreclosure consultants who purchase equity in residential property are required to provide to clients a contract which contains, in part; total consideration to be give, terms of payment, services to be performed before or after the sale, time of transfer, terms of any rental agreement and a five day cancellation notice. The property can not be transferred, encumbered, convey any interest in the residence, pay the seller any consideration until the cancellation period has expired. The cancellation period can not be waived.

California law requires representatives of equity purchasers to have a valid current California Real Estate Sales License and must have a bond by a surety insurer in an amout equal to at least twice the fair market value of the real property that is the subject of the contract. The representative must provide this in writing and also a statement, in writing, under penalty of perjury, that they are properly licensed and bonded. Failure to comply with these requirements renders the contract void. By law, the contract must also provide for a five-day cancellation right and no monies must be paid prior to performing all the services set forth in the contract. Generally, failure to provide the cancellation notice, means that your right to cancel exists until you are notified as required and the cancellation period has expired.

Complainants about similar offers generally allege misrepresentation that the responsibility of the mortgage will be alleviated after the transfer of title, misrepresent that no tax consequences exist due to the relief of debt if a short sale occurs, avoid negative credit information, misrepresent the costs or returns to customers.