I am just curious how many of you are paying private negotiator costs on your short sales.  According to the Fannie Mae website, fees paid to a 3rd party to negotiate a short sale, aka short sale negotiation fee or short sale processing fee..cannot be charged to the borrow...

 

So my question is this...are most agents paying fees to have their short sales completed? 

What is a normal price to have this done? 

 

There is a rule out that 6% of the balance or $6000 which ever is less, will be paid out to a jr lien.

 

Also, a  $3000 relocation bonus paid to the seller to help them move out. 

 

Has anyone seen a limit put on the negotiation fees?  Again - what's normal to charge/pay?

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There is no rule,other than HAFA's $3,000 limit, to what a lender will pay to a second.

As a 3rd party negotiator, I do not charge the agent or the seller. We charge the buyer a 3% fee on RESPA, then get the sellers lender to issue a 3% sellers credit. Everyone wins!
Oh, I printed out a few pages from the help website regarding that 6% or $6000 thing...I will see if I can find it again tomorrow in the office and upload it somehow for everyone to check out it's validity.

My reason for my inquiry was that I have run across a Keller Williams team who charges the buyers a flat $795 bucks for negotiating the short sales on their listings. It has to be added to the purchase contract that my buyer will pay it. As anyone else ran into this? Is this something several agencies are doing to avoid negotiating their own short sales? Or are they doing business on the side so to speak, with all the negotiating classisfications out now - maybe they are charging special negotiation fees on top of their commissions?
Why shouldn't they? The negotiating is 90% of the work. When I negotiate a deal for an agent or attorney, I do everything, and they just get me comps and collect a check at closing. I even make sure the agents get their full commission if I can. Incredibly, I still have agents whine that I end up making more than they do. Well, Duh,I did all the work! :)
well, my thing is this - if one of our inhouse agents has the training - could she start charging the other agents in her office for her negotiation services if they don't want to do all their paperwork? just a thought.
and if so - what should she be charging? would a % or a flat rate be the way to go?
Hi Joseph,

Could you give me some more details on how you charge the buyer 3% on RESPA? I do 3rd party negotiations for other agents and I would like to do it for them without it costing them money out of their commissions.

They are willing to pay it because they see the value of outsourcing it to us, vs. doing it themselves. However, I am sure that they would really appreciate it if I could implement the same process that you have.

B.T.W. do you charge that same 3% to the buyer on the deals that you negotiate for your own listings?

Thanks,
Julie
I have listed a short sale and have hired a 3rd party negotiator to negotiate with the seller's lender. I have also brought in the buyer (Dual Agency) and is waiting for an approval - originally the negotiator stated to me and her contract reflects that she negotiates her 3% commission with the lender as well as the listing agent and buyers agents commissions. After 3 months still waiting approval - she emails me the following statement to make an Addendum to the buyer's purchase offer:

"In the purchase contract I would like the following clause put in the additional financing terms section:
“Seller to credit buyer 3% of sales price to go towards buyers closing costs"

And in the Counter Offer.

In the counter I would like the following:
“The short sale negotiations are being handled by “Inc.” and “The”.
Buyer agrees to pay the fees due the "blablabla" for their services. These fees will be 3% of the sales price.

Is this Legal? Need Advice?
I would suggest you call the CAR legal help line. They have mentioned this in recent newsletters, but I'm not sure if they have actually taken a position on it. I think it is unethical, at any rate. Basically,she is making the buyer pay her fee. And 3% is extremely high in Southern California. Does this person have a real estate license? If not, it is illegal for her to negotiate a short sale in California.
Coleen, this is exactly the right way to do this. Anyone who says different doesn't understand short sales and lender guidelines. The new FNMA purchase guidelines specifically say that it is OK to charge buyer's third party short sale negotiation fees and reimburse with a seller credit.
It might be OK if it was disclosed to the buyers ahead of time and they agreed to it. In this case, that didn't happen. If there are seller concessions available, they should go to the buyer, not to a negotiator. The negotiator knew that the lender wouldn't pay her fee and she didn't tell the agent until now. And 3% is a rip-off. Just another short sale scam in progress.
The negotiator is licensed What is the standard percentage in So Ca?
1%. The highest I have seen is 1.5%. Sometimes there is a minimum. What is the value of the property?

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