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Well it IS towards your final cost. Nothing here seems remotely off to me now that you've explained it. $3000 went where is should have and you put $1000 towards the $1800 that you will owe for negotiation services.
You're agent put the money in the appropriate place. I don't see any issue here.
Hopefully you will get issued short sale approval and be scheduled for closing soon. Good luck.
Gabe, if you are in California, there is an Express Real Estate Services in that state that is a licensed agent. I'm assuming they are following state guidelines and I do know that you can charge a buyer a fee out there, but I don't know much more in the way of details. Harry Clay is a member here that could probably answer more for you, but on the surface to me, it all looks like it was done above board.
Reply by Gabe on April 9, 2012 at 1:49am
Gabe,
I'm not sure what was said because I wasn't there. I personally prefer a short sale negotiation fee to be on the HUD but it doesn't HAVE to go on the HUD. If your arrangement was to pay $1800 for the negotiation of a short sale, an you just closed, then in my opionion you owe $1800 somewhere. FINAL payment is a very open term. If your total cost was $100,000 for the property and you agreed to $1800 negotiation fee, then your total payment for the property is $101,800. UNLESS they agreed to let you reduce your offer to the seller the amount of the negotiaton fee, but I have no idea because I have no idea what you signed.
The fee was disclosed to you because you SIGNED an agreement for it. If you didn't understand what you were signing then you should have said so at the beginning. I don't think anyone was misleading you. You clearly admitted you didn't know what you had signed. This negotiator did their job because it sounds as if you got the house.
The fee is not just thrown around everywhere. It was in an agreement somewhere that you signed.
I think that the negotiator could have gone one step further and put the fee on the buyer's side of the HUD, but again, they don't have too. That fee is a separate agreement the negotiator had to perform services that you agreed to pay.
(Oh, and above board...meaning they followed the rules to charge the fee. No one is trying to pull a fast one on you)
No legitimate third party negotiator would spring a fee upon anyone at the last minute. As a third party negotiator, we have a written fee agreement signed by the buyer BEFORE we start the process. That being said, it was disclosed and it is a reasonable amount, actually it's quite low (I certainly wouldn't work for 1%)
Also, unless it is a cash transaction, the negotiation fee MUSt be on the HUD-1. (Mine goes on buyer side)
Right, but he signed the agreement to pay the fee with the P&S...not at closing.
When you signed the purchase contract (P&S) you also signed something agreeing you'd pay a short sale negotiation fee.
Gabe, chalk it up as an $1800 lesson and enjoy your new property! Best of luck!
Gabe,
It sounds to me it's your friend that didn't do their job in explaining the fee well. I can only assume that either your friend, the seller's agent or the seller involved the negotiation company and whomever represented you should have explained clearly what the process was. I think your bad sentiments are misdirected. It sounds as if the negotiation company did their job. They got you the house you wanted for the agreed upon fee. It's sounds as whomever represented your interest in the transaction could brush up on better communication skills. If you're going to stop doing business with someone, it should be your friend. The negotiation company did their job.
Negotiation fees again may or may not go into escrow. It would have been spelled out most likely in the contract you signed.
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