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VISIT US ONLINE @ DSNEWS.COM felony charges against Stewart for defrauding buyers and sellers in short sale transactions. On April 18, 2012, Stewart pled guilty and agreed to, as part of the plea, surrender his real estate license, serve 90 days in jail, pay restitution of approximately $25,000, and was placed on formal probation for three years. "This case should be a warning to all licensees involved in short sale fraud," said Bill Moran, DRE's enforcement chief. "Such fraud by real estate licensees will not be tolerated and the DRE will continue to work with its law enforcement partners to ensure unscrupulous operators are punished to the full extent of the law." The California DRE warned that due to market conditions and the large number of financially distressed homeowners, the potential for short sale fraud is significant. Housing Sales Up in May, but Inventory Still a Concern The housing market in California looked mostly sunny in May with strong sales and stabilizing home prices, the California Association of Realtors (C.A.R.) reported. A release from C.A.R. showed that home prices in the state posted gains for the third consecutive month, and home sales finished well above last year's pace. "California home sales were strong in May, continuing the gradual recovery of the California housing market," said LeFrancis Arnold, C.A.R. president. "First-time buyers are recognizing that the housing market has hit bottom and are now seeing a sense of urgency to take advantage of ultra-low interest rates and advantageous home prices. Additionally, trade-up buyers are returning to the market after sitting it out for the past few years to get in on favorable home prices." Closed escrow sales of existing, singlefamily detached homes in California rose 3.4 percent to a seasonally adjusted annualized rate of 572,260. This is up from April's revised rate of 553,670 and is a 21.5 percent increase from 470,910 in May 2011. The sales figure represents an estimate of the total number of homes sold during the year if sales maintained the May pace throughout 2012 and is adjusted for seasonal factors that influence home sales. May's sales pace marked the highest year-over-year sales increase since May 2009 and was the highest pace since February 2009, when 598,770 homes were sold at a seasonally adjusted annualized rate. Home prices also appear to be stabilizing, with the median home price posting monthover-month and year-over-year gains for the third straight month. The statewide median price of an existing, single-family detached home was $312,110 in May, the highest price since September 2010 and an increase of 1 percent from April's revised $309,050. It was a 6.6 percent year-over-year increase from last May's $292,850. May marked the second straight month in which the median price posted above the $300,000 level. C.A.R. attributed the median price increase to a strong sales increase in the higher-priced coastal regions, particularly the San Francisco Bay Area, where the median price was $550,400. Labor and economic growth are both especially strong in that area compared to the rest of the state. Not all news was good, though. California's housing inventory sank lower in May, with the Unsold Inventory Index for existing, single-family detached homes dropping to 3.5 months in May, down from 4.2 in April and 5.7 in May 2011. The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate, with a 7-month supply being normal. "Low housing inventory continues to be the critical issue in the California market," said Leslie Apple-Young, VP and chief economist for C.A.R. "Inventory levels have not been this low since December 2005, when the supply matched the current level. The Bay Area has the greatest shortage of homes for sale, with inventory levels in the two- to threemonth range for Santa Clara, San Mateo, Alameda, and Contra Costa counties." The Realtor report also showed that homes are moving faster on the market, with the median number of days it takes to sell a single-family home dropping to 46.6 in May, down from 48.9 days in April and 52 days in May 2011. Maternity Discrimination Complaint to Cost BofA More than $160K The Department of Housing and Urban Development (HUD) announced recently that Bank of America (BofA) agreed to pay $161,180 to settle allegations of maternitybased discrimination. A complaint had been filed by the Fair Housing Council of Orange County (FHCOC) against BofA, alleging that one of its San Jose branches refused to refinance a woman's mortgage because she was on maternity leave. The Fair Housing Act prohibits discrimination in mortgage lending and real estate-related transactions based on race, color, national origin, religion, sex, family status, or disability. BofA was alleged to be in violation of the provisions protecting sex and family status. "The Fair Housing Act prohibits lenders from denying home loans to women because they are pregnant or on maternity leave," said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. "Today's settlement follows HUD actions involving other lenders across the country which we will continue until maternity leave discrimination is eliminated." The woman told FHCOC that a BofA agent in 2009 offered her a 5 percent interest rate for a home refinance loan with no costs or fees. After she applied for the loan and supplied the necessary documents in January 2010, the bank allegedly refused to process her application because she was on maternity leave. The woman alleged in her complaint that a bank agent told her she would have to return to work full-time in order for her loan to be approved. The bank refused to process her loan even after she revealed she received the same pay and benefits while on maternity leave. The bank did approve her loan in March 2012, but the interest rate had increased to 5.25 percent by that point. A BofA official shared a statement regarding the incident: "We regret our treatment of the applicant. We take our Fair Lending responsibilities very seriously and will work with HUD to ensure our customers on maternity leave are treated appropriately during the mortgage application process." Under the terms of the Conciliation Agreement, BofA will pay $30,000 to the woman, $16,180 to her attorney, and $15,000 to FHCOC. The rest of the settlement will go to create a $100,000 Compensation Fund to pay damages to loan applicants who may have been denied a loan, subjected to adverse loan terms, or had their loan applications delayed because they were pregnant or on maternity leave. The bank is also requiring all of its loan officers nationwide to complete annual Fair Lending training. 79

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