Realtors collecting fees for negotiating short sales.

I have previously seen legislation stating that a Realtor could not collect a fee for negotiating a short sale, nor could he collect extra commission for handling the short sale. 

Friday, I attended a seminar where a local Real Estate Attorney said that a Realtor can get paid and can earn extra commission.  Can anyone tell me where I can find this ruling?

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Permalink Reply by Duretta Lorang on June 10, 2012 at 2:24pm

Hi.  Actually, although I have been doing short sales for a couple of years, and almost always close them, I have never charged the buyer.  We live on an "island" of sorts and do not get that kind of training or knowledge passed to us often.  I am also in a learning curve.  That is why this group is so very helpful and when I get a few minutes of extra time, I go here to gain more insight and helpful tips.  It is a great site!

Permalink Reply by Joseph Alfe on June 11, 2012 at 3:23am

Cindy, how long have you been using this, and where did you get the language?  It is almost word for word what mine is, and mine is copyrighted.

Permalink Reply by DJ on September 8, 2014 at 10:45pm

Good morning...could you possibly email me the document you use for buyer's facilitating fee?  I greatly appreciate it...I have been handling short sale processing for 4 years and as you know some are just not worth the money, but I love the challenge and helping people.thank you

Permalink Reply by Jennifer Viger on June 14, 2012 at 9:41am

Cindy,

I would love to see the verbiage too!  I was contacted by an agent who has an attorney that they use to do this and also tag it as a "buyer facilitation fee." First I had heard of it and I think its a great idea.  I have turned down a few short sales referrals lately because commission on a $30k sale doesn't go far enough when I am splitting the commission with another agent.  This would level the playing feel versus $150K properties at least a little.

Permalink Reply by Donna McClelland on June 21, 2012 at 7:43am

Hi Cindy,

I have had luck doing it the first way you list, except on an FHA Wells Fargo sale.  They would not allow the buyer facilitation fee to show on the HUD.

Permalink Reply by Cher McCleary on February 25, 2013 at 6:26pm

Hi Cindy,

Do you charge the facilitation fee on your own listings as well?

Permalink Reply by Cher McCleary on February 26, 2013 at 11:40am

Well that's great news!  Thanks so much for sharing, I'll definitely have to implement once I verify with my state's laws. Thanks again

Permalink Reply by Elisabeth Ann Dasilva on April 24, 2013 at 6:20am

Hey Cindy, I am the Florida Realtor who has been practically stalking you the past 24 hours! I have also been charging a $2,000 fee to the buyers and there is not an agent alive who will ever make me feel guilty or unethical for doing so. My last short sale was for a $37k condo...sellers filed bk in the middle of it & I spent 7 months and over 100 hours working it all out between Wells Fargo bk dept & the sellers lawyer, it was a nightmare. And to expect me to do it for 3%...for a  final paycheck of $800?? I am worth way more than $8 an hour. I value the time & dedication I give on all my shorts, and i have 2 in the past year that have gone from offer submission to written approval in under 20 days! I am good and I do such a great service for the buyers b/c they now have the home they want and I am happy for them even though they were not my clients.

I have 1 agent giving me grief about this fee, saying it's wrong because only negotiators approved by MARS are allowed to get paid...I told her I'm not a negotiator or a processor, I have labeled what I do as ss expeditor or facilitator. My terms are all on the MLS, and there is a written agreement buyer signs...all is disclosed and of course it is on the HUD on the buyer's side. The only time this fee was rejected was on a VA loan, like you had experienced as well.

So, #1 thank you for posting this issue & sharing it with the world. And #2 can you please email me the form you have, because if it's better than mine I will use it from now on!

Thanks Cindy+++++

Permalink Reply by Josh M. Boggs on June 11, 2012 at 7:59am

In Texas,

We are allowed to bill for an additional fee and we do.  We bill up front and it gets paid to a separate entity since we have it split up as short sale processing and listing are 2 separate jobs.  Our promulgated forms do not mention any of the scope of short sales so that is has been approved for us to charge up front additional compensation for that service. 

Best of luck.

Josh

Permalink Reply by Terry Maness on June 12, 2012 at 5:20am
Sorry Wendy. If I were in Florida, I would like to answer the question asked. I hope you found where by now and if so, please if you can share with others so they too can have that info I am sure they would appreciate it very much. Take care.
Permalink Reply by Gail Oleaga on June 16, 2012 at 5:38am

Wendy,

Last week I spoke with the FTC legal department regarding this and the answer is yes if:

You are a Realtor in good standing and you are involved with the short sale.

However, my Broker will not allow us to collect the fee as he is fearful that the Agents may abuse this and give the Agency a bad name, so, I am unable to do so.

This ruling changed July 2011. Feel free to go to the FTC website or call to verify this and then clear it with your Broker too.

Hope this helps!

Gail

Permalink Reply by Joseph Alfe on June 17, 2012 at 2:43pm

wait, you don't think short sales are prevalent here? There are parts of the city and suburbs where they approach 100% of new MLS listings.  I would say the average here is 2.5% to buy side. As a negotiator, I charge the buyer my 3% and the agents split the 6%.

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