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A cowpie award…. Let me just stick my head in the short sale toilet and flush …..

March 12, 2011

First Place Cow Pie Award!Are the feds trying to make it harder to get home owners to do short sales? These new short sale disclosures are just making things worse…

I have no money to pay any commissions, I can’t pay them. Now you are asking me to sign something that says I have to pay you commissions if my lender won’t? How do I know if my lender will pay the real estate commissions before I sign the listing agreement and this form?

We were just handed 3 disclosures from the Connecticut Association of Realtors® to use in a short sale, required by the FTC. First is signed before we speak to the lender on behalf of the seller. Second, when offer of short sale terms comes in from the lender, the third is a cover sheet to be used when an agreement of terms is reached, and the agreement requires sellers signature, or when the Realtor® receives communications from the lender.

Points in the first disclosure:

  • Seller can stop agent from contacting lender, stop agent from negotiating terms of a short sale at any time.
  • Seller can accept or reject offer of mortgage assistance, up to and including the terms of an approved short sale.
  • If seller rejects the offer, they do not have to pay the agent’s brokerage for negotiating done.
  • If seller accepts the offer, seller will have to pay the agent’s brokerage for negotiating the short sale.
  • The amount of commissions due is stated in the listing contract.
  • Agent and brokerage are not associated with the government.
  • Service provided is not approved by government or lender.
  • Even though seller accepts this offer, uses agent’s services provided, there is no guarantee that the lender will agree to a short sale or agree to change the loan.
  • If seller stops paying mortgage, seller could lose home and damage credit rating.
  • And of course, I am not an attorney, please contact an attorney…. etc.

Why isn’t there ONE clear regulation that says if the lender agrees to a short sale, they agree to the commissions stated in the listing contract, up to a certain percentage. Why isn’t there some notation in these new FTC forms that states that clearly? I can find documentation to send certain clients to, but can they make this any harder for people who want to sell short? I can see many a roadblock with this new form, I just encountered one.

And why aren’t we approved? We are the ones that are getting these short sales sold! I’m just sayin…. So here I sit, sign this form please but I am not approved by the government or your lender to negotiate this short sale for you. Oh, you want someone who is approved by the government or short sale? Folks, who is on the lender and government approved list?

Another one bites the dust before it even starts….. Listen closely, that sound you hear is me… flushing my head down the short sale toilet.

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