i’m wondering how this works - if i do a deal without a realtor in the beginning of a short sale (before it is approved) obviously i will not include their commission in my calculation - however what if i obtain a ss approval and an agent comes in with a buyer - at that time is it ok to add their commissions with the bank (include an addendum) or does an agent have to be involved from the very beginning for the ss to work - i work with a lot of fsbo’s so i have not yet had to deal with this issue but know it will soon come up
however what if i obtain a ss approval and an agent comes in with a buyer - at that time is it ok to add their commissions with the bank
Little confused on this. When ‘doing’ a shortsale, YOU are the buyer. The homeowner, the one in default is the seller. In a shortsale, you cannot ‘bring’ in another buyer at all. So, if you didn’t bring in the agent, and the seller doesn’t have an agent, then there won’t be an agent.
my apologies, i process the short sale packet for the seller, i am not the buyer and i don’t bring in the buyer - sometimes the homeowner acts as a for sale by owner and other times we bring in a broker for them - if we bring in the broker after the short sale has been approved is it allowed to tack on the fees or is it too late at that point to bring in the broker
That’s probably a case by case scenerio. It really is up to the bank to decide.
I’m not sure where you come into play at in the SS. In order to do a shortsale, there must be a buyer making an offer. If you have a buyer, then you either already have an agent (buyer’s agent) or you don’t (independent buyer).
What condition would arise where it would be necessary to bring in an agent after the sale is approved?
Most of my clients are fsbo - they don’t want to use an agent due to the lack of equity however if they are unable to bring in a buyer within 15 days of us working with them - we refer them to a broker. I don’t tend to send in ss packets without a buyer but if the time is ticking and we don’t yet have a buyer but want to obtain a buyer while we are waiting for ss approval, what can we do? Is it a rule to never submit the packet without a buyer ever???
You could put the property under contract and have a clause that allows you to assign the contract. That’s what I do. Very rarely do I have a problem with a bank refusing the contract because of the assignee clause
Really! I was told the banks will NEVER accept an assignable contract on a short sale!! We were taught to put the property under contract, then find end buyer, and do a double closing.
Actually, I have a question on this same subject… I have a HO I am working with in pre-foreclosure. I brought in an agent to list the property. I put it under contract, we will find an end buyer then negotiate a ss with the lender. Regarding commissions: We are negotiating for the bank to pay 5 % commission, but when I re-sell at the double closing do I pay commission for 2nd closing or does the end buyer??
TO THE BEST OF MY KNOWLEDGE, YOU NEED TO HAVE A REALTOR AND HAVE THE HOUSE ON THE MARKET FOR 90 DAYS TO SHOW THE LENDING CO THAT THE HOUSE HAS NOT SHOWED, AND OF COURSE DID NOT SELL, HAD NO OFFERS, ECT. AND TO DO A SHORT SALE, YOU NEED TO HAVE A CONTRACT OF SALE AND PURCHASE IN ORDER FOR THE LENDING CO TO EVEN CONSIDER DOING A SHORT SALE.
Thanks, I already have all that in place, my question was just about paying commission to the agent.
You should have no problem when adding a commission to the HUD. Remember the original HUD is only a Preliminary HUD and if you have a situation where you need to bring in a agent the bank understands this.
BUT…if you are doing a double closing then I think it would be your responsiblity to pay that commission…you are the one selling after all.
Someone correct me if I am wrong???
Ok, thanks…so the bank pays commission on 1st, and I pay commission on the 2nd. I think that makes sense. Then the agent has more incentive to work with me, since she will get 2 commissions…just so that is not against rules for the agent… :cool
You dont need the agent to do the SS do you? I would not pay the agent when you are negotiating a SS for your self…there is no reason to pay the agent when you are buying the property from the HO with permission from the bank. You only need to pay them for listing the home…typically 5-6% (i would not pay more than 5% and tell them that you dont need any open houses or a ton of extra stuff. ) I am a Realtor and putting a home on the MLS is what sells it…not all the 800 numbers, open houses, broker opens, and fancy fliers. Sometime you might find a buyer from that stuff but it is far and few between. Besides, if you want to do an open then do it your self and put in your listing contract that if you find the buyer then the agent takes a 3% commision and just does a facilitator agreement(basically represents neither of you and just sets up the docs and closing. Remember EVERYTHING is negotiable and if they say NO then say, Ok, well I am going to call so & so because they said If I ever needed it done then they had no problem doing it that way. The agent is not going to let a commission walk away.
I hope this helps.