Replies to This Discussion

Permalink Reply by Jack Fleming on April 21, 2010 at 1:37pm

And they want you to work for nothing?
Let me get this straight. You brought them a buyer and they want to take their mistake out of your hide by giving your commission to them? Someone at the bank has a large set of brass ones! Maybe they should take it out of the underwriters who intially approved this toxic loan.

Permalink Reply by Alexander Max on May 17, 2010 at 9:31am

A threat of the buyer walking sometimes works out ! Our law firm always gets the 6% realty commission because it is included as the first line in the terms and conditions. I know how these banks are ..they no problem paying out a 4.5% when they originated the loans .

Permalink Reply by Lynn Pineda on May 17, 2010 at 9:45am

Would you know that I'm still dealing with this Short Sale; perhaps one of my most challenging from all sides; Both the 1st and 2nd and also the Sellers are very slow to respond. In fact, just today after being told last week that I should be getting this resolved with an answer in a few days, have now been advised that the 2nd has charged off the loan and it's in Wachovia/Wells Fargo Recovery Dept ...Brilliant, just brilliant. After months on end of going back and forth with the underwriter constantly seeking additional documentation trying to find monies from the Sellers, have now thrown in the towel and have charged it off. So here I go again, new approval needed from the Recovery Dept. Just pathetic!

Permalink Reply by Cynthia Robbins on May 18, 2010 at 10:00am

I heard that as of the first part of May the HAFTA agreement is up and running. Part of that agreement is that lenders cannot short change the Realtors involved in the transaction. you might want to check to see if there is anything under the law that can protect your paycheck.

Permalink Reply by Lynn Pineda on May 18, 2010 at 10:16am

Hi Cynthia, I'm all set with my commission now as the 2nd charged off the loan and their recovery dept is reviewing for settlement.

Cynthia Robbins said:

I heard that as of the first part of May the HAFTA agreement is up and running. Part of that agreement is that lenders cannot short change the Realtors involved in the transaction. you might want to check to see if there is anything under the law that can protect your paycheck.

Permalink Reply by Laurie Clark on June 1, 2010 at 8:02am

I found this article and thought it would be worth sharing. Commission Awarded in Failed Short Sale

A lender has to pay a broker's commission after waiting too long to nix a short-sale transaction.
By Robert Freedman | November 2009

Stewart v. All States Quality Foods, L.P.
Court of Appeals of Iowa


A broker is entitled to his commission in a failed short sale of a warehouse because the lender acted in bad faith by waiting until closing to demand a larger share of the proceeds, according to an Iowa appellate court ruling.

In May 2006, the broker received an offer to buy the warehouse. The lender, which had taken steps to wind down the business activities of the financially troubled owner, authorized the broker to submit a counteroffer, which was accepted. The broker drafted a document detailing the likely distribution of closing proceeds, which included a share of $110,000 to the lender.

At this time the warehouse tenant, whose lease agreement gave it the right of first refusal to buy the property, sought to exercise that right. The tenant gave the broker its earnest money, and the broker informed the lender and the owner of the offer, as well as the fact that the parties were ready to close.

The lender responded that it would not accept less than $130,000 and the transaction collapsed.

The broker filed a lawsuit, claiming that he had satisfied the terms of the listing agreement and was entitled to a commission. The trial court ruled in his favor and the lender appealed. The Court of Appeals of Iowa affirmed the lower court’s decision, saying the lender had improperly interfered with the contract by allowing the broker to forward a counteroffer without disclosing that the lender would allow the transaction to close only if it received a certain amount from the sale.

While the lender had the right to demand a specific figure from the sale, it knew that the tenant’s offer was unlikely to reach that threshold. Nevertheless, the lender authorized the transaction to proceed without alerting the parties that it would seek to obtain a higher sum, through various concessions, than the sale price alone could generate.