I’m still unsure of how to work with RE agents, can somebody with experience please, please break it down for me step-by-step on how you’ve worked with an agent before, specifically:
Scenario 1, have the listing canceled:
If a seller is behind payments and has his house listed and the home doesn’t seem likely to sell, should I try to convince them to have the listing canceled and initiate the short sale? Would this be legal? Would it violate any laws regarding the RE agent?
Scenario 2, approach the agent as a “buyer” contingent upon SS approval: 2) Should I tell the seller to keep the home listed and sign all my SS documents, and then proceed to get the short sale approved? If I get a reduction in price approved, how does this affect the agent’s commission? How do I work with the agent to make this happen? Any experienced insights??
Scenario 3, have a power of attorney signed and have the RE agent re-list the home under my name
3)Should I have the seller sign a P.O.A to me, and have the home re-listed while I control everything?
Sorry for the questions, but as you can see I’m really confused. I have some opportunities to work with agents as well, but I’ve been holding off because of my uncertainty.
Please share your detailed insights and experiences. Thanks so much.
It appears as though investors are working with Agents in various ways.
Under your first scenario:
Once you take deed of the property, you are essentially the new owner. Because there is a listing agreement, the Agent may have some claims against the seller in terms of commissions for the “sale” (unlikely, but it is possible). In this case, tell the seller to get the Agent to rescind the listing agreement. If the Agent cannot help the seller via a conventional RE sale, then he should at least allow the seller to explore other options: yours.
Once the Agent is out of the way, turn around and list the property with YOUR Agent “Pending SS Approval by lender” on MLS. Your Agent will handle the Buyer for your property, and you will handle the SS with the Lender.
List the property for 300K (example) and SS the lender for 200K. Let’s say the bank come back at you with a 250K offer, and your Agent gets offers for 300K. So now you have a deal. Your Agent gets whatever commission is appropriate for your state/area.
The important issue here is to be upfront with the original Listing Agent. I have heard of Agents refusing to rescind their Listing agreement and causing the seller to lose sale opportunities.