Hello I'm near the finish line to closing on a short sale, it's been rough but I'm almost there! One issue I'd like to discuss is this. In the beginning I was never aware of the terms that came with the sale not once was it disclosed to me that I would have to be paying the negotiator fee. So when my agent asked me to give a deposit to a certain guy, I said well wait what is this for? he had told me it went towards my final payment. Later down the months I come to realize that it wasn't he himself told me that the thousand dollars is a separate fee that "all short sale transaction have to pay" I've been doing my research and realized that this is not true and this fee can pretty much be thrown around anywhere. The agent is a friend of mine he had just got started out and coming to this forum I realized that was a HUGE mistake. So i guess my question is should I just eat the cost for the agents mistake? Or is there something I can fight this with because I was misinformed. I believe it is up to the agent to disclose all terms and fees about the property before I even step foot in the condo. This was never done. I'd really appreciate everyone's opinions on how to handle this situation, thank you.

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What did you contract for in the purchase agreement?  Is such fee in there? In there an addendum where you agree to pay such fee?  Or, have you signed an agreement with the party to whom you are considering paying this fee?

This is about what in the agreements, I think.

Sounds like someone may have agreed to make this payment, and now is trying to get you to pay so they don't have to. 

The fee should have been disclosed somewhere.  If it wasn't, there is an issue.  I agree with Michael, check your P&S, addendums, riders, and any other paperwork you signed.  If the agent is saying it's towards your "final payment" then find out what the final payment is for.  Ask for an invoice, or receipt for the deposit so you know exactly what it went towards.

I found where I signed paperwork where it says "Buyer will be responsible to pay the short sale processing fee of 1% with a minimum fee of $1800 and will be responsible to post a refundable deposit if they want to be locked into the deal" so I guess I'm turned around a bit, is this the same as a negotiator? I guess what I paid for is a processing fee, so I guess the new question is should I have to pay for this? Is that a typical thing? I know I signed it already so maybe I made a mistake. My argument still is I wasn't aware and nothing was disclosed to me that there were going to be fees that I would have to pay that will not goes towards escrow. When I asked what the $1000 dollar upfront deposit was for it was said to me that it would go towards my final cost, since that was not true I just feel mis informed, no one sat me down and said "now you know going along with this purchase there will be fees outta your pocket" if I knew that, then I would have walked. So apparently I owe 800 dollars when escrow closes.

Gabe, you are responsible for paying $1800 for the short sale processing. It sounds like the $1000 is your escrow deposit and not part of the $1800.

While your agent should have verbally explained this to you, you signed the agreement stating that you would pay the short sale processing fee.  If you want the home, $1800 should not stop you.

I agree with Jeff.  It likely could have been explained a bit better, but you need to read what you are signing.  $1800 is a small price to pay if you get the house you want.  Keep in mind lenders tend to counter offer much higher than that.

 

Yes it is a typical thing, but most do a better job explaining it.  Negotiators charge several different ways.

Well the 1000 didn't go to escrow, it definetly went towards the processing fee.  But yeah its just weird to me that I'm paying for something outta pocket that doesn't go towards my down payment. I appreciate all the help and advice!

Gabe, are you sure that it went to the processing fee?  Did you deposit escrow money?  Your agent should be able to explain this a little better to you.  Did you sign something that says you pay the processing fee up front or at time of closing?

Yes I am positive. my initial down payment was $3000. There is in writing the it was my Responsibilty to pay, doesn't say upfront and doesn't say upon closing. Might have to eat $1000 here but since it is outside of escrow I am not paying the rest of $800 I refuse because I have in writing my agent telling me all this money was towards my down payment, I was mislead.

It sounds like you were definately misled. Who is doing the negotiations?  Who did you make the check out to?  You may check to see if it is legal to take an upfront fee in your state.

Gabe, call your agent and ask him for the breakdown of where the $3000 went?  If it was all for the down payment and you have it in writing, then there shouldn't be an issue.  It's up to the agent to rectify.  I think you just need to clarify things.  It doesn't seem like your agent is purposely trying to mislead you.  You signed an agreement that you would pay the $1800 so that is your responsibility to pay if and when it gets to closing.  My gut says none of that fee should have been paid until closing but I don't know exactly what you signed.  Agents, and lawyers I believe can be paid up front without interfering with MARS guidelines.  The rest need to wait until closing. 

Good advice Smitty! 

3000 went to escrow I wired it myself. the $1000 dollars check I wrote out, I gave to the processor (was lead to beleive it went to the down payment). the $3000 was the most recent payment I did for my condo, the $1000 was back in january. I need to look up these MARS guidelines. check was made out to ERES, Express Real Estate Services. I made the mistake of not reading the paperwork its just before I signed I asked about it and was told it was towards "my final cost"

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