What does it take to negotiate a short sale? That’s easy. It takes a home owner who wants to sell their home. It does not require a lawyer, a REALTOR, or any other special entity. There is no requirement for certification, licensing, or any special degrees that are required to talk your lender into accepting a payment for less than you owe.
The Path of Least Resistance
Attorneys don’t have any more power to negotiate your short sale than you do. What they do have the power to do is charge you a retainer up front to do exactly the same thing that you can do. Now, as a short sale expert, I can tell you that you do not want to be the one handling the negotiations. It is time consuming. You’ll be on the phone constantly with your lender hounding them for information. You’ll be taken away from your work, your family, and your peace of mind. You’ll make roughly 60-90 phone calls and will be bullied by them. Regardless of the fact that you could do this yourself, you would be crazy not to hire someone else to do it for you.
So Who Do You Hire?
Well, that’s completely up to you. But hiring an experienced Realtor is your best and least expensive avenue. Through the process you are going to have questions that need to be answered. You’ll have questions that involve deficiency judgments. That’s when the bank holds you responsible for the difference between what you owe, and what the home sells for. Those questions are answered by an attorney. You’ll have questions about your tax liabilities. That’s what your CPA is for. Then you’ll have questions about selling your home and negotiating with the lender. That’s what we’re here for.
So Who Negotiates With the Lender?
The Realtor handles this for you. Why? Because he or she is paid at close of escrow and does not charge you up front. If you hire an attorney to negotiate your short sale, you will pay a retainer before anything comes of it. If the lender doesn’t agree to the sale, you cannot recover that money. CPA’s just don’t do this type of work, so you wouldn’t ever hire them for anything other than tax advice.
Why are Attorney’s Selling Negotiation?
Because there’s a market for it. But you still need a Realtor to list your property and negotiate a contract price on your behalf. Also, because the attorney gets money up front. They also give you no guarantee that they will succeed. Just because they’re an attorney does not give them any more ability to negotiate with your lender than anyone else. They aren’t “forcing” the banks legally to accept less than you owe, but because they’re “attorneys” there’s some sort of mystical magical power that people think they have as opposed to a Realtor. They’re just doing what your Realtor has been thoroughly trained and is well-qualified to do for you.
Note: It is absolutely critical that your Realtor know how to manage a short sale.
If you’re going to sell short, don’t you want someone who has your best interest in mind? I don’t charge an up front fee to do the same job better than they can. Take the path of least resistance, and least financial risk. Leave the legal issues up to the attorneys. Leave the sale negotiation up to us.
For more info please visit harcourtlegal.com.
I appreciate a short sale is the sale of the home in which the sale proceeds falls short of the balance owed on the property’s loan. A negotiation is entered in to which the homeowner’s mortgage company or companies accepts less than the full balance of the loan at closing. A buyer closes on the property and the property is “sold short”. ~va short sale
Beware: You are engaging in the unauthorized practice of law. Only a licensed attorney can negotiate short sales with regard to ANY terms other than simply providing information about price. I know a realtor who negotiated a short sale – the family moved out of state, were sitting down to breakfast one dqy when they got served with a lawsuit for a $250,000 deficiency judgment. The realtor is now dealing with liabiilty for that judgment, as well as charges or UPL. Beware.
Kathie, I appreciate the feedback, but I can assure you I am not practicing law. All of my clients are advised to seek the advice of an attorney and tax professional prior to entering into an agreement with their creditor(s).
My job is to facilitate the sale of real property and ensure that the information required in the transaction is communicated in a timely manner.
Any type of short sale negotiation with the lender takes the realtor beyond the amount of legal work they are permitted to do. Realtors can prepare contracts using pre-approved forms, and they can represent their clients at closing, but they have very limited paralegal type of duties they can perform for their clients.