Comments on: Loss Mitigation Officers, Gone Wild!

By: Bluenote

Bluenote — Fri, 30 Jan 2009 21:09:12 +0000

Every think that the time has come for Brokers to reduce their exhorbitant fees. While there are really great agent out there. Most aren’t worth the price of a gallon of gasoline!!!

By: Bo Buchanan

Bo Buchanan — Fri, 02 May 2008 05:33:59 +0000

Our MLS recently added a section to the SCI (special compensation information) section of the mls when we enter CC – it now adds the text “Requires Lenders Approval” next to commission offered. I hope this covers us here regarding the comment made by Mack in Atlanta. In too many situations, owners owe more than the property is worth. I would hope that if you show comps and a market analysis that you could back it up to the board. We also have a clause in our contract that says “Requires Third Party Approval” that should be checked with a short sale offer.

By: Glenn fm Naples

Glenn fm Naples — Mon, 28 Apr 2008 12:14:51 +0000

Bob – your “the transaction is contingent upon seller approval of all lien holder terms and conditions” is very inclusive and should be used – I know I will be adding it from now on. Yes the lender does have an adversarial position – it is called cutting their losses.

By: Bob

Bob — Mon, 28 Apr 2008 11:14:52 +0000

Call any loss mit department and you will hear a recorded message disclosing the debt collector status. By definition, the lender has an adversarial position. Simply stating that the short sale is subject to lender approval is not enough. A clause stating that the transaction is contingent upon seller approval of all lien holder terms and conditions any chance of should always be included in a counter.

By: Natalie Langford

Natalie Langford — Mon, 28 Apr 2008 03:36:50 +0000

I just had to comment on the @ sign being used. I’m getting pretty good at recognizing the twitter addicts!

By: Mack in Atlanta

Mack in Atlanta — Sun, 27 Apr 2008 17:39:09 +0000

@Bill This was not from my board. It was from the agent in Grand Rapids. I was just posting it in this forum for informational purposes.

By: Bill Lublin

Bill Lublin — Sun, 27 Apr 2008 17:33:32 +0000

@Mack in Atlanta;
Your board would not make public a decision becuase all such decisions are confidential and you may (probably) have only part of the story, and none of the documentation, so don’t jump to coclusions

@Glenn frm Naples – Your point about how you would have ruled has the same problem – we just don;t have enough info to make an infomred decisions (that’s why arbitrations take so long and som man y questions can arise.

@everyone – I agree that negotiating the commission in a potential short sale situation in annoying at best, and I can understand why anyone would resent it, but we need to remember that we have an obligation to put our client’s needs before our own, and if we allow the commission to be placed in front of needs of our seller or buyer client, we’re just plain not doing the right thing.

After all , the responsibility to pay us rests with the client, not the lender, so if you have a real problem with the difference in the earned commission and the negotiated commission you might want to address that with your client. But do you really think someone should face a foreclosure when there is a potential short sale just so we can be paid a specific amount? Or should the buyer lose the home they and their family will live in for that reason? And should the lender (who is already taking a loss) be responsible to pay a commission that they never agreed to pay? We’re no different in their eyes from junior lien holders who have even more to lose if the sale doesn;t go through.So while I don;t like it, I think we need to do the right thing to get the client what they need.

By: Glenn fm Naples

Glenn fm Naples — Sun, 27 Apr 2008 13:09:24 +0000

I would have ruled against the payment of the commission, based upon the quote “all offers are subject to bank approval” as this is an upfront contingency – however, did the listing agent not add that clause to the offer and send it back as a counter-offer. By adding the clause to the offer or contract would have made it a contingency.

We have been discussing issues with potential short sales in both the Legal Resources and MLS committees here.

Our next go around should be on the pre-foreclosure and possible short sale listings where the seller moves and is not reachable via mail or telecommunications. This is an issue to the listing contract being a bi-lateral contract.

Another issue is when a “short sale export” is handling the short sale aspects, the property is listed with another real estate agent and the “short sale expert” brings in a buyer.

The potential short sale transaction has many issues which need to be addressed.

By: Mack in Atlanta

Mack in Atlanta — Sun, 27 Apr 2008 12:33:10 +0000

There was a question posted by an agent on Trulia Voices about short sale pricing and how an agent had listed a home for less than the bank would accept to generate traffic and covered his rear end by putting in a “subject to bank approval” clause. Here is a twist on the commission portion of this discussion that was posted by Chris Freeman from Grand Rapids:

I thought I would share a related anecdote regarding
————–”all offers are subject to bank approval”—————

2 weeks ago, our board handled a grievance where the short sale in question was listed for (say $100,000, because I didn’t ask the actual price). They had the “all offers are subject to bank approval” clause in the listing.

The offer came in at full price with no contingencies. The listing agent tried to get the bank on board, and they said “NO!” The deal was unable to go forward, BUT the selling agent filed a grievance for their commission and the board ruled in their favor. The listing Realtor had to cough up the commission.

I am a little more skiddish about short sales since this ruling.

The thing that actually makes me most nervous is that the board has not announced the ruling to the rest of the REALTORS. The only reason I found out is that I know the Realtor who lost the grievance.

I guess there are no guarantees but death and taxes.

By: Jon Sigler

Jon Sigler — Thu, 24 Apr 2008 01:36:23 +0000

If the lender didn’t get enough net for them, don’t accept the offer. Doing all this junk on commissions is only taking money from the people helping them out of the mess.