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We recently processed a short sale for a struggling home owner located in Florida. We obtained short sale approval for the first lien holder who, in turn, agreed to pay the second lien holder $2,000 for a $45,000 balance. The second lien holder asked for a Seller contribution of just under $400 and, in turn, would completely forgive all remaining debt and would not seek a deficiency judgment. This arrangement was put in writing.

When the Realtor representing the Seller learned that the lender was requesting the contribution, he went ballistic and tried any/all means of NOT requiring the Seller to come in with the additional funds.

While I understand that the Agent is working in the best interest of their client; for just under $400 it seems like a “good deal” to the Seller. The Seller has indicated that they have availability to pay the contribution, and agreed to pay said funds; but the seller is being discouraged in making such a payment by the Agent.

Again, I understand that this Agent is supposed to be working in the best interest of his client, BUT, is this Agent willing to “step up to the plate” and pay a future deficiency judgment in the event that the property is foreclosed or if the bank should agree to a different type of short sale approval at a later date requiring a deficiency agreement?

The moral of the story: While the Real Estate Agent should always focus on obtaining the best resolution to a transaction, sometimes the best resolution may incur nominal costs — to walk away from a $45,000 obligation with less than $400 out of pocket seems like a pretty good deal to me! It also seems like the Agent is setting himself up for a potential future liability.

Oh well, just another day in paradise —

Rick Schuster
Licensed Real Estate Broker – Jaycee Realty, Inc.
Licensed Title Insurance Agent – Home Guardian Title, Inc.
Licensed Mortgage Broker – Leading Edge Mortgage Corp

20283 State Road 7 – Ste 400
Boca Raton, FL 33498

561-206-2835 – via Google Voice
561-988-2546 -Fax

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