Hello fabulous short sale superstars!
I don't know if I had seen this question here before, but should you try and list a family member's home with you as the listing agent, of course with full disclosure, or just refer it out, so you don't break the Arm's Length Affidavit? This is a Wells Fargo loan.
If you have to refer it out, can your name be added in to the authorization form to negotiate on behalf of your seller (the family member?)
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Laura, just looked at WF's Short Sale Affidavit that was signed by all parties this month and it specifically states
(a) The sale of the Mortgaged Premises is an “arm’s length” transaction, between the parties who are unrelated and
unaffiliated by family, marriage, or commercial enterprise;
If you justify it as it is arms-length anyway....you could come into a headache by signing or refusing to sign this required Affidavit. If it were me I would refer it out. I wouldn't hold out much hope of getting WF to delete this requirement anytime soon.
I had an agent at the office attempt this and their negotiator slammed the file shut..Arms length infringement. I would refer it just to not waste time in case you get a stubborn negotiator..
Was referred a listing from an agent who listed her son's home, B of A, and they declined because they were related. WF has an arm's length so I don't think I would go down that road.....On another note, I have negotiated a family members short sale w/ the bank while anothe agent did the listing (it was in another state) and had no problem, it was quite successful. That is just an authorization on the account and can speak to the bank. The seller's could do this too, they just don't know how to negotiate a short sale w/ the bank.
I have been told by Citbank that they would not pay a commission if either agent was related to the buyer or seller. I had an agent submit an offer for her son and the bank refused to pay commission to her.
Bank of America declined my daughter's short sale until I had another agent in my office do the transaction for her. I do not believe it is a conflict of interest, but Bank of America said they had no way to be sure my daughter would not profit from the sale. I dont know about anyone else, but I am not in the habit of giving away my paycheck, not even to family members.
I had good luck with Wachovia and Franklin.
Let us know how it comes out..
Linda
Jeff you have made very reasonable rebuttal arguments to this question.
YES BUT, one lender framed it to me in the form of a short sale fraud scenario.
The listing agent family member has the control and power to extend their family members time in the home for up to one year rent free via stifling negotiations with both the buyer and with "document omissions" in the short sale package submission to the sellers lender.
If and when it comes down to contribution participation demands of the seller, the buyer and/or both agents of any short sale approval "funds-short-fall" this issue really comes into play.
BOA did not allow me to list my Uncle's home in a short sale. I referred it out to another agency and received a referral fee. (25%)
I did not add my name to negotiations as the agent and allowed the agent to do his job. He successfully closed on the home.
Thank you all for your responses. This is a Wells Fargo cooperative short sale. I am leaning towards referring it out
P.S. Thanks to All you Short Sale Superstars who are regulars here, I became a better and more educated short sale agent because of you guys. Here is hoping we successfully close more short sales in 2012. Thanks Wendy and Bryant for creating this group.
I've successfully completed this with BofA. It was fully disclosed on the contract and had to be escalated so it wasn't auto-declined. I was not paid a commission. However, when I researched it, I was told that if it had been a Fannie Mae loan I could've collected commission as well.
From my experience, B of A would have declined the Short Sale if you were receiving a commission as they would assume that to be a tangible benefit to the Seller who is otherwise required to net $0 at closing.
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