What are the seller's costs in a short sale?

[greenjewel]

We received an offer for our home we are trying to short sale. The offer came from our realtor’s office (his co-realtor is representing the buyer). We were told it was a great offer, but the buyer is asking us to pay all his closing costs. We are not going to do that – I was just really surprised our realtor let that offer be written knowing our financial straits. The offer also has us paying appraisal fees and other fees. I was under the impression that in a short sale the lender would pay the realtor’s commission and the seller’s closing costs. What about the inspection? Would we have to do any repairs the buyer wants? I thought in a short sale we were selling the house “as is.” There are some flaws, but we tried to leave the house in the best condition possible, spending almost $1000 on carpet cleaning, window cleaning and other services.

What fees are we ourselves responsible to pay as a seller in a short sale? Til now we have only been worried about the deficiency judgment, but now we are worried that we will have to somehow come up with money at close.

[Enough Already]

I'm sorry to be so blunt, but it sounds like you need to get a new realtor. Short sales are tricky, and you need a realtor who's experienced, in short sales specifically, and knows all of the ins and outs of them.

In a short sale the bank pays for everything, realtor commissions, appraisals etc. Also, short sale properties are sold as is. So, your potential buyer can do an inspection (at their expense), and if they don't like what they find they can walk away. You should not pay for ANYTHING. Your realtor should know this.

Don't worry about losing the buyer. If you're house is priced right you'll easily find another buyer. It doesn't matter to you how much it sells for, just as long as it sells.

The best advice I can offer is to cut your current realtor loose, and try to find a local realtor who has lots of experience and success with short sales.

Good luck to you!

[MAXIE19]

Be weary of realtors with potential conflicts of interest stemming from working for the same company. You may want to get yourself represented by a realtor from a different real estate company.

[greenjewel]

Thank you! It looks like I need to have a discussion with my realtor when he gets back in town tomorrow. I am nervous about hiring someone else, because we have only two more months before they foreclose. On the purchase agreement, there is a grid that shows what the buyer pays for and what the seller pays for. On this offer, the appraisal, title search and septic pumping is checked for the seller. For a short sale, should any of those be checked? How do they work it out with the lender to pay for those items the buyer doesn't want to pay for?

[greenjewel]

Originally Posted by MAXIE19

Be weary of realtors with potential conflicts of interest stemming from working for the same company. You may want to get yourself represented by a realtor from a different real estate company.

That's a concern for me too! But I wasn't sure how common it was, and thought maybe I was just being paranoid. How would I go about being represented by a different company?

[MAXIE19]

A lot depends on your contractual obligations. Even if you are still contracted you may want to let your agent know that you are uncomfortable with him or her representing you in a short sale transaction where the buyer's agent hails from the same office. You may request to be released from your contractual obligations so that you can have an agent from a different company represent your interests. Even if they are not willing to give you such a release, seek third and fourth opinions from other real estate agents and real estate attorneys before signing any documents. Ultimately, the decision to sign is yours. Do not sign any documents if you are not comfortable with the terms of the transaction.