Short Sale Superstars

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A short success story.

I fought Nationstar on and won.  Lots of research on this forum helped and I even got a call from an agent in another state that really helped guide me.  The short story, we (the buyer) were in contract with money in escrow and NS pull the card.  We had a mediator on the deal and she eventually elevated this to upper management at the " department at Nationstar."  They finally capitulated and said the program was, in fact, optional.  We were allowed to proceed normally with our short sale.  We closed last week.  Horray.

You can fight Nationstar on this.  They know sellers are over a barrel and are trying to get any money they can for the house.  While that is understandable, their tactic is not.  

Fight on. 

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can you email me who you contacted.  I have 2 right now with Nationstar and is calling my seller's what seems like every 5 mins.  My seller's told them they will not be sending any of their documents.

my email is

I don't have a contact as a mediator was negotiating on our behalf.  I know that the seller must be on board and in NY, we have lawyers representing as well as agents, so we had their lawyer write a letter stating that the seller would not agree to  

It worked on our deal but I'm not sure how far out the seller was from foreclosure.  

I am trying to make this happen right now.. Just filed a complaint to fannie Mae.. I have gotten nowhere with Nationstar!

Kathy,  Are you telling me the NS is trying to push a FNMA back property to  I know some people at FNMA who would be very interested in learning about that.  Contact me

same here, hoping you can send me the contact you used. I have a contract with a buyer who has already done the inspection. Pulling the card now is breach of contract and could be costly damages for the seller

same here.  If we use the same contact person hopefully we can get our files to move forward.  My seller is in Ca, and is scared he will be sued by the "potential" buyer who has a valid signed offer.

Well done. Good for you.

This strategy by Nationstar clearly violates state and federal laws against steering, and also violates consumer privacy laws.  My suggestion would be to warn your Sellers that Nationstar's strategy to sell the property on will at best reduce the offer price by 5% (the amount of the mandatory Buyer premium) which will increase their deficiency amount.  At worst, it may get them foreclosed, or even put them into a contract dispute with a Buyer who already had a contractual right to buy the property, which in most states is contingent only on lender rejection.

Do not let the Seller sign anything from, or from Nationstar authorizing  If Nationstar passes your customer's contact information on to, file a complaint against Nationstar for violation of consumer privacy laws with the Consumer Financial Protection Bureau (  They are not allowed to pass information to a third party without specific written authorization to do so.  I also have my Seller sign a letter that requests no phone contact from the lender whatsoever.

When Nationstar inevitably threatens that your short sale will be declined/foreclosure initiated for your non-compliance, the following response will fit into the Equator message field limit:

"Negotiator Name:
Per our conversation, you have stated that you will decline our file because we have not agreed to participate in the kickback program, which provides Nationstar with a financial incentive for steering Sellers' home sales into purchase by Buyers who are paying a secondary Buyer premium benefiting and Nationstar. This violates RESPA's steering provisions against lenders who would require Sellers to use settlement services which provide a kickback to the lender. You have already ordered and obtained a third party value opinion, which is the industry standard for offer value validation, so any requirement to use is clearly designed to add unauthorized and illegal financial benefit to Nationstar, NOT to "validate" offers. If you intend to decline our sale to force us into your settlement steering policy, please do so promptly and in writing, so that we may add this case to any class action that may be forming, and to our AG/DOJ complaints."

We need to stop these lenders from using illegal tactics to bully our Sellers and steal our commissions.  They are the reason this has happened to our customers, our industry, and our nation in the first place.

I can understand if you do not like , but how they do business has nothing to do with "RESPA's steering provisions"  This provision deals with loan officers who push a client into a particular loan product or lender in order to make more commission. Nationstar just asks that your client be pre-qualified with their lender. If the sale is all cash , RESPA would not even be in place.  Settlement services deal with Escrow and Title. Also the short sale advisory in most states allows for the listing agent to submit multiple offers to the bank. I do not think this is a good practice in general, but it is in place. Buyer does not have a legal right to buy the property until the short payoff is agreed. I have had two different RE attorneys look into the contract, in each case their opinion was that the lender can dictate how they choose to approve short sales.

My main point is that if agents do not like Nationstar or , there are probably ways to pull your client from the program and do the short sale. But telling your client not to participate because the agent does not like the program may put the agent at some risk. I believe the more intelligent route is to learn and understand the program and communicate with everyone involved. 

What I see on these forums most of the time is an attorney trying to generate support to file suit. Which I am never quit sure how this action actually benefits the seller? 

my 2 cents, but feel free to tell me why I am so misguided. 

Unfortunately, that is exactly what this is, but we are really talking about two different concepts...

Nationstar's program has nothing to do with loan approval, although Nationstar's does have a steering policy with regard to Buyer loan approvals as well.  Nationstar's policy of requiring Buyers to preapprove with Nationstar does not violate the law, but refusing them their negotiated closing cost credits if they don't close with Nationstar, IS a separate steering violation that Nationstar also engages in.

Specific to the subject of this topic, however, the problem with the program is that Nationstar forces its captive inventory of short sales into the platform in order to enrich Nationstar, not to "validate offers," as they put it.  

Here is how it works for Nationstar's benefit:  A winning bidder has to pay a 5% Buyer's premium, which contributes to a kickback later paid to Nationstar for getting into bed with  If value is what a Buyer is willing to pay, that means that on average, property will sell at a lower price (Buyer's maximum value LESS the 5% premium that wouldn't be added to a transaction).  This means that all things being equal, property sold on will always sell for less--that is, it will sell for the Buyers willingness to pay, minus skim fee.

When property values are artificially skimmed by 5%, it hurts everyone--comps in the neighborhood are diminished, appraisal values are suppressed, and Seller's deficiencies are increased.  In states where there is recourse rights for deficiency, that means the Seller has a bigger bill to settle after a short sale.

Nationstar says it needs the process to "validate" offers, but they already have ordered and have in their possession a third party BPO or appraisal, which is the industry standard for validating an offer.  This works for every other lender, so the reason it isn't sufficient for Nationstar has nothing to do with offer validation, and everything to do with illegal kickbacks.

A lien holder evaluates a purchase agreement struck by Buyer and Seller, and accepts or rejects it.  Any condition they place, or hoops they require jumping through, are third party interference, and if you don't act like a sheep, they don't have any power to force you to participate.  I have done more than 400 short sales, many of them at Nationstar, and more than 98% of my short sales have closed successfully.  I have never allowed my Seller to be forced to participate in  You may think that refusing doesn't benefit the Seller, but any unnecessary hoop or roadblock to the short sale closing is a problem for the Seller, and is an unnecessary leech that skims value off the top of short sales, adding no benefit for the Seller (or the loan investor, for that matter).  If it was a worthwhile process, FNMA and FMHLC would be allowing to be required for their files--guess what?  They aren't interested in having their offers "validated" for a 5% skim fee.

As you suggested, I have taken the "intelligent route" of learning and understanding this program, which is why I explain to my Sellers that is not in their best interest, and secure their agreement not to participate.  I recommend to all real estate agents to do the same, before this grifter-servicer destroys our marketplace and our industry.

I am at 300+ short sales and have closed 4 with Nationstar under their Validation program so I am familiar with the program. In CA we do not have the deficiency issue. My understanding is with Nationstar is that Nationstar does not pursue any type of deficiency if the seller goes through this process. I cannot validate this claim being in Ca. In my opinion if we were really all worried about comps , how come everyone is not applauding Fannie Mae by their over valuations.  I understand your thinking, but not in agreement on some your points.

Also,  credit for closing cost has nothing to do with Steering either. It would only be steering if the Nationstar gave credit for closing cost "option" on a 30 year fixed vs but not on 15 year fixed where the Nationstar loan officer would generate more income. The Kickback RESPA vilolation is where the lender / loan officer gives the RE agent $ for referring business or any third party. 

I believe the general underlying issue is that most RE agents main concern is that they will lose control of the transaction

Actually there practice is a violation of RESPA LAWS as OCWENs. There is a lawsuit that was submitted actually detailing RESPA as well as state Real Estate Licensing Laws.


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