Replies to This Discussion

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on November 29, 2010 at 9:22am

You said:

"We settled the transaction and asked for Attorney Fees which they previously agreed to. Negotiator changed the terms of the transaction...."

Not sure what you mean by "you settled" - in CA that means the transaction is closed & recorded with all disbursements made. You also "asked for Attorney Fees... " Wouldn't that have already been agreed to and included in the Short Sale Approval Letter from BofA prior to settlement? A Short Sale cannot close (settle) unless it adheres to all terms in the written approval letter. What are the attorney fees for? Seller / Buyer closing costs? or 3rd party negotiation by an attorney? If 3rd party attorney fees, in addition to commission, it very likely won't be paid. None of the big servicers are paying 3rd party fees in addition to commissions.

Permalink Reply by Todd J Sullivan J.D. on November 29, 2010 at 9:39am

Poorly crafted language (it's a monday...). You are absolutely correct. I should have stated that I had hoped we had finalized the negotiations since the assigned negotiator had not changed any of the prior terms since the initial negotiations had began which included 3rd party negotiation fees (attorney fees). The third party negotiation fees had been negotiated from an original request for $8,000 to $5,000. Although other fees and cost were further negotiated, the negotiator did not request further reductions until we requested a note rather then cash at close from the seller. At that point, he changed other negotiated portions of the transaction and demanded a final answer on the day after thanksgiving. As part of the initial negotiations, the negotiator reduced commissions to 5%. In light of the many challenging issues that I have read about on this forum, I know that this is minor but still annoying.
***Is it your guess that they allowed the third party fees due to the 5% commission?
Thanks for your response,
tjs

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on November 29, 2010 at 10:00am

Here's the deal.... Any 3rd party negotiator fees that are not being paid by the Listing Agent from their commission are likely going to be denied.

When an agent / broker takes a Short Sale Listing, they have automatically assumed the responsibility to negotiate that short sale. If they cannot, will not, or do not want to, do it and they want to hire a 3rd party negotiator (Broker or Attorney) then the LA needs to pay for it from the Listing Side commission. It's their responsibility and they need to accept the cost as well.

All of the big servicers have recently been very public that they are not paying 3rd party fees in addition to commissions.

Since the short sale was declined, the LA can always resubmit showing the HUD paying the 3rd party fee paid from their commission. This arrangement has to be disclosed in advance to Seller and the Buyer and all Brokers have to agree in writing to the arrangement as well.

Sorry, but I'm a 3rd party negotiator too and my fee ALWAYS comes from the Listing Side Commission.

Best of luck,

Thom Colby
Broker
Newport Beach CA


Todd J Sullivan J.D. said:

Poorly crafted language (it's a monday...). You are absolutely correct. I should have stated that I had hoped we had finalized the negotiations since the assigned negotiator had not changed any of the prior terms since the initial negotiations had began which included 3rd party negotiation fees (attorney fees). The third party negotiation fees had been negotiated from an original request for $8,000 to $5,000. Although other fees and cost were further negotiated, the negotiator did not request further reductions until we requested a note rather then cash at close from the seller. At that point, he changed other negotiated portions of the transaction and demanded a final answer on the day after thanksgiving. As part of the initial negotiations, the negotiator reduced commissions to 5%. In light of the many challenging issues that I have read about on this forum, I know that this is minor but still annoying.
***Is it your guess that they allowed the third party fees due to the 5% commission?
Thanks for your response,
tjs

Permalink Reply by Todd J Sullivan J.D. on November 29, 2010 at 10:57am

Thanks Thom for the information!

I should probably put my Realtor license to work as they seem to be getting paid (that should get the conversation going*).

tjs