I see such outlandish advertising in Sacramento about short sales. Agents put out marketing pieces that say all services free to homeowner. Hate to burst their bubble, but our short sale services are not free to the homeowner. Or, agents will advertise that there is no cost to the seller because the bank pays everything, including commission. Excuse me? The bank does not own the house.
One of the biggest worries that sellers have is whether they will have to pay the commission. It's a big chunk. No doubt about it. As a Sacramento short sale agent, I have the lucky job of explaining the new MARS disclosures to sellers. I start out by saying the forms were designed to stop crooks and especially the advance-fee loan modification guys -- they aren't specifically directed at short sale agents but short sale agents got stuck like flies to the red-tape madness.
I'll give you this about the MARS. It does say the seller pays the commission. It also says the seller can cancel at any time. I always tell sellers that nobody in Sacramento is going force them to sell their home as a short sale. To do a short sale is their own choice. They can always cancel.
I also say they pay all of the costs. This is how it works, Mr. Seller. You own your home. The bank does not own your home. The bank has a lien secured to your home.
Say, your home is worth $100,000. A buyer agrees to buy it and hands you $100,000 in cash. Out of that money, you pay me the commission. You also pay all of your title and escrow fees. Whatever amount is leftover, well, all of the remaining balance goes to the bank. It's just like a regular sale. The only difference is you are not putting any of that money into your pocket. Because the bank is accepting a reduced payoff to do the short sale, the bank will approve all of the fees, but it doesn't pay any of the fees. You do.
If the bank can find a way to reduce the fees, then the bank will get more money from you. That is why the bank approves the fees. But bottom line: your house, you pay the fees to sell. You just don't take any money out of your pocket.
When I put it that way, they understand.
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Certified HAFA Specialist
My Sacramento Real Estate Listings
Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout the four-county Sacramento area. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. Broker-Associate at Lyon Real Estate. DRE License # 00697006.
The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com.
Lyon Real Estate is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.
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The views expressed herein are Weintraub's personal views and do not reflect the views of Lyon Real Estate.
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