MLS verbage????

I am always amazed at some of the MLS verbage that I see..... here is the latest.

 Any acceptable Contract must contain the term that Seller may cancel this Contract at any such time that he is asked to sign a Promissory Note, is presented with a 1099 or Deficiency Judgement

 

So let me get this right, the seller may cancel if:

  • They are asked to sign a promissory note
  • They are presented with a 1099
  • They are subject to a deficiency judgement

Would you advise your buyer to pursue this short sale? 

Oh and one other thing, it says that the price is BANK APPROVED?

 

Anyone else see any redflags?

 

The other thing that I am seeing more of is "This is a (insert your short sale designation) short sale which will speed up approval times"

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Permalink Reply by Jeff Payne on July 15, 2011 at 4:54am

Harry, that is my point, why would any agent advise their buyer to make a run at this one?  The listing agent most likely has no clue and did not advise the seller properly.  The way I see it, one or more of those 3 items is going to happen which means the seller can cancel this contract.

1099 is an IRS issue and does not mean that they are subject to income tax, it just means that it is being reported.

Permalink Reply by Monique Boucher on July 15, 2011 at 4:57am

The IRS Federal guidelines state that if a debt is discharged or forgiven over $600.00 that the creditor must issue a 1099. Any Agent listing a home this way is setting their seller up for failure as well as wasting their own time. In fact - they would be better off letting the seller know that obtaining a 1099 is in their best interest, especially if it is their primary home as the current tax laws allow this debt to be forgiven. I am not an acocuntant but I have completed enough short sales to know that there is no way around a 1099 if the debt is discharged - unless of course it is less than 600.00 dollars - and then I am pretty sure it would not be a short sale LOL!! All the homeowner would need to do is google 1099 - everything you need to know is on IRS.GOV.



Harry Clay said:

Doesn't all forgiven debt (unearned income) receive a 1099 in the beginning of the new year following the year of the write off?

Would not the seller receive a 1099 from the lender after the house is sold as a short sale, or it's foreclosed, or some kind of permanent modification with principal reduction is agreed to?

Permalink Reply by Jeff Payne on July 15, 2011 at 5:00am

Here is another one that is a bit more vague...

"Seller shall have the right to cancel the Contract if Seller's lender requires Seller to execute any document subjecting Seller to a deficiency judgment, promissory note or other similar post closing arrangement.

Permalink Reply by Jeff Payne on July 15, 2011 at 5:01am

And another

We are CDPE agents & have a system in place to streamline the approval process.

Permalink Reply by Smitty on July 15, 2011 at 5:08am

Ya, that was my first reaction.  This is an inexperienced listing agent.  If the bank asks for a note at closing, and the seller doesn't want to agree, the lender will likely just foreclose so realistically the seller doesn't have a choice.  It's the lesser of two evils.

 

I would consider the "this is a (insert your SS designation....." almost a MARS violation.   MARS rules prohibit negotiators from making any false or misleading claims about their services. This is not new (fraud or false promises have always been a trade violation), but NO ONE should be claiming they can speed up approval times.  I would NEVER EVER claim that.  It's kinda scary.

Permalink Reply by Jeff Payne on July 15, 2011 at 5:11am

Smitty, how about this one :)  What does this mean? 

This is a approved CDPE Short Sale.

 

**** I am not picking on CDPE********  I promise

Permalink Reply by Jeff Payne on July 15, 2011 at 5:16am

I can go on all day with this :)  Doing some market research today and have found some good ones.

SHORT SALE!!!! The Bank is ready for an offer. 

Permalink Reply by Jeff Payne on July 15, 2011 at 5:31am

OUCH look at this one

(same seller 2 different investment groups). Please use 2 contracts.

Permalink Reply by Bryant Tutas on July 15, 2011 at 5:35am

OK you guys are cracking me up here!!

If yo uhave all of this free time why not come show my new short sale listing.

 

"Short Sale. Pre-approved price. Negotiable. Please allow 120 days for approval."

Permalink Reply by Neddie B. on July 15, 2011 at 5:38am

LOL! Yes you are.  No I'm not....Yes you are....No I'm not....Yes you are.    :)

I've seen more appropriately, "This is a CDPE negotiated short sale" 

So, a CDPE approved short sale, no can do....


Jeff Payne said:

Smitty, how about this one :)  What does this mean? 

This is a approved CDPE Short Sale.

 

**** I am not picking on CDPE********  I promise

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on July 15, 2011 at 6:15am

It's always interesting to see the creativity in the MLS "agent remarks".  My interpretation of your original example is - the listing agent is trying to double-end and wil make exceptions to the rules set forth when (s)he gets an offer from one of their own buyers.  As others have said (and we all know) a 1099 is not issued until after the transaction has closed the the new year has begun.  There's no way any buyer should get involved with this transaction.

 

On the CDPE issue,,, I've heard the "designation" may have to be changed and the "E" dropped.  It will be interesting to see what happens.  Some Brokerages here in SoCal are directing their agents NOT to use the CDPE designation in their marketing materials or any advertising until it gets resolved.

 

 

Permalink Reply by Smitty on July 15, 2011 at 6:15am

ouch..my brain hurts.

 

I've got one.

"Seller reserves the right to cancel sale if they decide to do loan modification"

?!?!?

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