Replies to This Discussion

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on March 16, 2011 at 3:45am

Well, this topic has certainly received a lot of comment !

 

I said this earlier and I'll say it again -

 

As long as we are all doing our job according to the law and our AOR and MLS Rules and carrying out our clients (legal) requests, none of us have anything to worry about. 

 

I think it gets very close to the "thin grey line" when agents forget who their client is, think more about the commission than the client, give away negotiation of the short sale to the Buyer's Agent or a Buyer's Agent's Negotiator (talk about fox in the hen house) , or don't look closely enough at potential flipper transactions.

 

I also feel that that very few agents will direct a potential client to find another licensee to represent them if the proposed transaction "smells".  If we don't have our ethics, what do we have?

 

Finally, I think it may have been inappropriate for the Long Island Board to publish the statement they did & in the tone they used.  They provided no factual reference or point of origin for the information - it seemed to be "hearsay".  Their alert is the equivalent of yelling "fire" in a Movie Theatre without an actual fire.

 

I think we have beat this topic to death.  Just Google - FBI Short Sale...... anything you ever wanted to know is there.

 

Thom Colby

Broker / Negotiator

Newport Beach CA

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Permalink Reply by Lisa Jalufka on March 16, 2011 at 4:05am

Donna - since most banks specifically require an executed sales contract with the short sale package, that to me says we have to sign & ratify the offer.  We can't ratifiy multiple offers at the same time.  And, as already commented multiple times here, the bank does not own the home, the borrower still does.  So, I do not see any foundation in the allegation that all offers must be submitted to the bank.

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Permalink Reply by Raymond Kennedy on March 16, 2011 at 5:21am

Your statement:

 As long as we are all doing our job according to the law and our AOR and MLS Rules and carrying out our clients (legal) requests, none of us have anything to worry about.

 

I think a lot of the question comes up on what is the law in regards to this and how does that apply to us. This is a much simpler answer when your doing a traditional sale but it gets very vague when there is a third party who is not our client is taking a loss and our actions could drastically increase that loss. Is holding a higher and better offer (not necessary multiple offers) from the lender a potential legal risk. Your sellers request isn't always in their own best interest and could put multiple people in liability if they are not properly advised. Could this be considered fraud on our end? 

I believe this is why there is so much response to this post, everyone is just curious about the best way to handle those situations so they aren't putting themselves in liability.

Thom Colby said:

Well, this topic has certainly received a lot of comment !

 

I said this earlier and I'll say it again -

 

As long as we are all doing our job according to the law and our AOR and MLS Rules and carrying out our clients (legal) requests, none of us have anything to worry about. 

 

I think it gets very close to the "thin grey line" when agents forget who their client is, think more about the commission than the client, give away negotiation of the short sale to the Buyer's Agent or a Buyer's Agent's Negotiator (talk about fox in the hen house) , or don't look closely enough at potential flipper transactions.

 

I also feel that that very few agents will direct a potential client to find another licensee to represent them if the proposed transaction "smells".  If we don't have our ethics, what do we have?

 

Finally, I think it may have been inappropriate for the Long Island Board to publish the statement they did & in the tone they used.  They provided no factual reference or point of origin for the information - it seemed to be "hearsay".  Their alert is the equivalent of yelling "fire" in a Movie Theatre without an actual fire.

 

I think we have beat this topic to death.  Just Google - FBI Short Sale...... anything you ever wanted to know is there.

 

Thom Colby

Broker / Negotiator

Newport Beach CA

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Permalink Reply by Paul Francis - Vegas Short Sales on March 16, 2011 at 11:51am

I think this article has been blown out of context...

 

What the FBI really cares about are the "get rich quick in short sales" schemes such as Agent A submitting low ball (fake) offers for short sale approval at $$ price.... taking title or one of their "investors" taking title and then flipping the property on over to the real buyer at $$$ price for a $ profit.

 

Obviously.... anybody with any short sales experience knows that there are now numerous measures in place to avoid this...

 

A couple of years ago... there were not.

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Permalink Reply by Bill Travis on March 16, 2011 at 12:07pm

A new twist is where a buyers agent is tied up with an investor. The buyers agent asks the listing agent to double end it so as to make more commission. The thinking is the listing agent will push for the sale at a lower price. I won't do that. I want to get as much as I can for the seller so the sale can have a chance of being approved. I don't do dual agency anyway.

I had a call from an investor today on a short sale I have. He asked me to represent him in making an offer. He kept asking me how much it would take for him to get the property. I told him he would have to determine what he was willing to pay and have an agent write his offer.

I told him I would refer him to an agent who would represent him, but he said he knew agents that he could use. He still kept pushing and I kept refusing. I did tell him I would help him write up an offer as an "unrepresented buyer" but I would not be able to provide price guidance. That wouldn't work for him.

But I will only work for one side. He finally gave up.

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Permalink Reply by Conrad Randolph Hodgson - Broker on March 16, 2011 at 12:56pm

LOL...... If you think it takes long to do a short sale now......imagine what it would be like if we submitted every offer and had to start again.  What about those shotgun buyers that submit an offer on 20 properties and take the first one that gets approved???????????I dont believe this information at all. 

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Permalink Reply by Laura Marshall on March 16, 2011 at 1:10pm

I have worked with many investors on my short sale listings. I price my listings at market value. If they are not willing to make a market value offer, I won't write it. It is not in the best interest of the seller to work with an offer that won't go anywhere. For myself, I do not see a conflict of interest. The seller needs to sell...the bank wants to most they can get, and the investor (if I am working with him) is willing to pay the market price.
Bill Travis said:

A new twist is where a buyers agent is tied up with an investor. The buyers agent asks the listing agent to double end it so as to make more commission. The thinking is the listing agent will push for the sale at a lower price. I won't do that. I want to get as much as I can for the seller so the sale can have a chance of being approved. I don't do dual agency anyway.

I had a call from an investor today on a short sale I have. He asked me to represent him in making an offer. He kept asking me how much it would take for him to get the property. I told him he would have to determine what he was willing to pay and have an agent write his offer.

I told him I would refer him to an agent who would represent him, but he said he knew agents that he could use. He still kept pushing and I kept refusing. I did tell him I would help him write up an offer as an "unrepresented buyer" but I would not be able to provide price guidance. That wouldn't work for him.

But I will only work for one side. He finally gave up.

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Permalink Reply by Laura Marshall on March 16, 2011 at 1:14pm

LOL !!!! Submit 20 offers ???? It's hard enough to get one offer and package into their system....LOL. I had one that was denied multiple times because they said the homeowner had over $200,000 in her 401k...and she would not make a contribution. I kept telling them that the seller did not have a 401k.  It took almost 3 months of escallating the file before I reached a VP who actually would look at what I sent...and not other peoples notes. The $200,000 in the 401K was the BUYER'S proof of funds (and had the buyer's name on it). No one ever noted my side of the conversation. 20 offers????? OH MY !!!!!
Conrad Randolph Hodgson said:

LOL...... If you think it takes long to do a short sale now......imagine what it would be like if we submitted every offer and had to start again.  What about those shotgun buyers that submit an offer on 20 properties and take the first one that gets approved???????????I dont believe this information at all. 

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Permalink Reply by Rain Silverhawk on April 15, 2011 at 3:42pm

It is our duty to present all offers to the seller who is our client, not the lender.  Almost every short sale I have ever had I have received back up offers on and I have tried to announce them to the lender.  All but one case, the lender said they did not want them.  The banks that use websites like equator will not let you upload a second offer.  I can't see where there would be any liability here unless the agent was failing to present subsequent offers to their client the seller.

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Permalink Reply by Kimberley Kelly on April 17, 2011 at 2:50am

Makes no sense.  The Seller needs to see the offers that come in, choose the offer, I submit the offer and work it with the Lender.  Any other offers are held "subject to 1st position offer withdrawal".  Hmmm..interesting.

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Permalink Reply by Tni LeBlanc (805) 878-9879 on April 17, 2011 at 5:27am

The banks think everyone works for them!  I don't -- I work for the seller. 

They order $15 BPOs on a property and then want to say that they were de-frauded about the offers received?  I would not be able to close a short sale if I continued a never ending bidding war while the bank processed the file.  How many buyers want to be involved in a 4 month bidding process?  Give me a break. 

I am disappointed that anyone in the FBI would even follow up on this. After all, the banks committed one of the biggest frauds in American history, the FBI knew about it, and did nothing.  Now they are pursuing these little cases?  It's laughable, really.  There is no one from the top sitting in jail over the housing bust -- so the FBI only looks down the chain not up the chain?

I do think there are people out there trying to take advantage, but it is the lender's duty to properly value the asset.  If the offer is not acceptablee or less than what they think they can get -- they demand more -- they do this all the time based on cheap valuation methods.  They will definitely have the opportunity to see all offers if and when they take the home back in foreclosure.

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Permalink Reply by LIZA DIGALIZIA on April 17, 2011 at 8:26am

Most the replies here are correct.

The seller choses one offer, the one he likes best. It does not have to be the highest and best, BUT the one he likes the best. Then, we as his representative send it to the bank. If the bank does his calculations, etc, and says not enough then we resubmit another offer.

I have been taught that the seller is the one who signs the offer and is STILL the owner of the property.

I don't see how the FBI would get their hands in the pie, maybe there is another motive.. Fraud?

I don't seee how..or why ...

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