Does anyone know the latest FHA rule re can the buyer of a short sale getting an FHA loan pay a 3rd party short sale fee?

Views: 695

Reply to This

Replies to This Discussion

I don't know the answer to this but I definitely want to know.  Personally, I think it's ludicrous that any 3rd part negotiator would charge a buyer (not their client) a fee for helping the seller (their client).  Seems like a conflict of interest to me.

I agree it seams ludicrous that the buyer would have to pay that fee.  However, when the seller has no $$'s and can't pay it, but wants to do a short sale, some one has to pay.  It indirectly benefits the buyer, because they et the house.  The time spent on paperwork and followup is considerable.  Realtor's don't have time to do that, and can't afford to hire it out either.  Especially when they are getting less than 6% and than have to split that with a co broke.  

The bank is the one that benefits more than the buyer. By completing a short sale, they are (generally) saving tens of thousands of dollars by not foreclosing. I do a lot of short sales (myself) and yes, I have time to do them along with selling and being an owner. It can easily be done.


There is no conflict, when the fee is disclosed up front. The 3rd party, assuming they are straight, works to facilitate the deal for both the buyer and he seller. There are good, bad, and cooked 3rd party megotiators, as well as agents. You can make all kinds of arguments about who benefits the most, etc. but it's irrelevant.
Regardless of what a 3rd party negotiator says, they are not hired by the buyer and therefore are not an agent of the buyer. Imagine if your wife hires an attorney to complete the divorce proceedings and then says you, as the soon to be ex-husband, must pay money for the attorney's services (even though the attorney's interests lie squarely with the wife - his client). Please don't insult my intelligence by suggesting that the 3rd party negotiator 'works' for the buyer.
I agree with Garett. I can't stand when listing agents hire a 3rd party negotiator and then demand that the buyer pay the fee because the bank never pays for it. I list a lot of short sales and have never charged a fee to either the buyer or the seller for negotiating the sale. If you don't know what you're doing when you list a short sale or you "don't have time" to handle the negotiations, then maybe you shouldn't be taking the listing.

I think this is silly too.  Third party companies often have too many files to doa good job anyhow!  They should pass a law that 3rd party companies need be licensed real estate professionals.

Just to be clear, and I know I'm in the minority..I work both as a Realtor and sepearately as a 3rd party for other Realtors/buyers/sellers.  When I work as a 3rd party, I have a signed agreement with the Buyer, stating what the fee is, and that the Buyer will be responsible for it, assuming it is not paid through any buyer concessions, given back by the seller's lender.  The problem is when, as with a lot of 3rd partys, no fee agreement is executed, and the fee becomes a "surprise" once you get close to closing, or they start playing games with addendums/HUDs trying to hide the source of their fees.  And yes, some 3rd party negotiators, who have no executed fee agreement, will attempt to hold the deal hostage until someone pays their fee.  In these cases, I agree the 3rd party negotiator should be cut loose, then shot.

I perform similar services to Wayne as both a broker and 3rd party company for other brokers.  As stated above, there are brokers and 3rd party negotiation companies who are great and those who are terrible - it really boils down to the people.  I would love to see that 3rd party companies regulated more because it would be great for those like me who are licensed and disclose properly.  


Camille,  and this is illegal how?



Ocwen Contacts Short Sale Package

Started by Jan Baron in Rants and Raves. Last reply by Anna Wilk Jan 14, 2016. 5 Replies

Shellpoint Mortgage

Started by Celeste ODea in General Discussion. Last reply by Brett Goldsmith Sep 4, 2015. 3 Replies

Extension Fees & Closing

Started by Colleen J Couse in Rants and Raves. Last reply by Brett Goldsmith Sep 3, 2015. 1 Reply

© 2022   Created by Mike Linkenauger.   Powered by

Badges  |  Report an Issue  |  Terms of Service