Listing a relative's home as short sale

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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Permalink Reply by Scott Korbin on December 18, 2011 at 12:22pm

That sounds like and administrative error. No good reason.

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Permalink Reply by Tonia Vickery on December 18, 2011 at 2:17pm

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.

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Permalink Reply by Teresa Turner on December 19, 2011 at 10:05am

I listed and sold a relative's home on a short sale only to find out at the end of the transaction that the short sale would be approved but that I could not be paid. I think Jeff has a legitimate point, but I think it's just going to depend on the lender and whether they are flexible about this or not.

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Permalink Reply by Jeff Payne on December 19, 2011 at 10:17am

Teresa, I agree with you, it will be up to the lender for sure. I dont have any relatives where I live so I wont have to worry about it but if I did, I would fight the lender for all my worth if they said I could not list my families home for sale. As far as getting paid, would you charge immediate family to sell their home in a traditional sale? I wouldn't and wouldn't in a short sale either

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Permalink Reply by Kimberley Kelly on December 20, 2011 at 9:35am

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..

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Permalink Reply by Tara Semtner on December 20, 2011 at 11:31pm

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.