Buyer' Agent is related to the buyer~Is this still an Arm's Length?

I just received an offer one of my listings and the buyer's agent is the father to one of the buyers. ASC is the lien holder. Just wondering if ASC will consider this to not be an Arms Length? Typically, it is relation to the seller.. Has anyone ever ran into this and had it be an issue? Thanks in advance.

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Permalink Reply by David Tang on October 9, 2011 at 6:25am

Varies by lender.  I have had similar circumstances with Suntrust and Wachovia where it was allowed but B of A said no.  Wachovia is also owned by Wells Fargo (which owns ASC) so would seem okay.  I also recall one lender saying they would not allow the buyer's agent to earn a commission (forget who).  I would say it is safest to have someone else represent the buyer from a commission standpoint - but if the agent is stubborn, just have an addendum that discloses this and submit that to the short sale lender along with all the other paperwork and see what they say.

Permalink Reply by Linda Susan Fox on October 9, 2011 at 9:07am

ASC will make everyone involved sign an arms length transaction document with a notary stamp.  If this document states the buyer and agents need only be an arms length with regards to the seller then it would be OK.  Everyone will need to read it carefully as you will also be signing it.  I would have someone else in my office write the offer to be on the safe side.

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