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Permalink Reply by Richard on August 2, 2011 at 11:13am

 

I know that the lenders want full control and it's their money, however there is a need for flexibility on the agent's part when the sale is not a traditional sale. There are a lot of us that work in fact based industries, however in short sales, there appears to be so many unkowns and nothing is a given.

This is one of my arguments that there should be more commitment from the lenders upfront in this industry.  Not having ever sold a short sale home, but by being a participant as a buyer, I know that there is a certain amount of work that goes into this transaction.  This effort appears to be well over and beyond a standard traditional sale. My brother, who is my realtor tells me that his work goes late into the day, not to mention the calls he get after hours.  If an agent is willing to take on a tough purchase or sell, then he/she should get paid for it.  Just my two cents............. 

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Permalink Reply by Bryant Tutas on August 2, 2011 at 12:41pm

Brian, I actually don't use that technique as I negotiate my own short sales. However I have my buyers agents run into the situation where the buyer was being asked to pay the negotiation fee. It threw my agent off tract. I simply told her to counter the deal by asking the seller to contribute that amount to the buyers closing. They agreed and it was not an issue.

My opinion it would be the occasion when it wouldn't work the way I had suggested.

I can think of several ways for a negotiator to be paid. Especially if they are licensee in real estate.

AND not all lenders even look at the buyer side HUD. I have closed many short sales where the final HUD was approved just by sending over the sellers side.

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Permalink Reply by Brent Innocenzi on August 4, 2011 at 4:32am

In doing this, would any laws or rules/regs be broken since this person is a licensed Realtor and not a licensed loan originator/mortgage broker? I was under the impression that only licensed originators/mortgage brokers could charge a "negotiation" fee.

Bryant Tutas said:

I usually just co-broker the listing side and we split the listing side commission 50/50. The listing broker and I work together. They handle the property and I handle the short sale and the seller.

 

You could though very easily charge the buyer side a percentage or a fee. It's all in the presentation. Just simply state in the MLS that "Seller will contribute 3% towards Buyers closing costs. 1% of this goes to the 3rd party negotiator for handling the short sale." Then just add an addendum to the contract. This way you are giving the buyer something instead of taking away. Plus they know before they even look at the property that this will be required. Simple

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Permalink Reply by Bryant Tutas on August 8, 2011 at 11:38pm

Brent. It would certainly depend on state law. In florida an agent cannot be paid for negotiating a short sale. They can however be paid for their real estate services of which "negotiating short sales" is part of. A licensed agent could be paid a referral fee after closing. They could be paid by the buyer and/or seller at time of closing or on a note after closing.

 

This would of course need to be run by an attorney to make sure it's legal in your area.

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