Good advice, James.  Sometimes getting all the lien holders to agree is like trying to herd cats!

Good advice.  Here in Florida we are seeing a rush of short sales.

James

You raise a very valid point.  More often then not, homeowners have equity lines and other subordinate mortgages.  Additionally, they may have judgment liens due to unpaid credit card debt, etc.  All lien holders have to agree to concessions.  The negotiations are difficult and time consuming.

As a title company owner, I worked as an REO outsource for years.  I soon learned that short sales were more work than they're worth.  I was always asked to reduce my fees, as were the real estate agents.   Not a good situation.

What language do people use in the contract to legally cover the seller and themselves if the lienholders will not agree to let the property go short?

Most of the time the first lien holder won't do anything, but the 2nd, and 3rd definitely will as they usually would be wiped out and get no money if it goes through the foreclosure process.  I do not agree with you on getting an attorney involved.  The seller just has to request a short sale package from all lien holders, and fill out paperwork, and than wait.  I guess if it gets complicated than absolutely, but typically a good title company will assist you with their attorneys, and you would not have as much expense.

David what I have seen in the past is that the first lien-holder may be willing to give a 1000.00 concession to show some type of good faith. It is normally someone that holds a junior lien that holds the process up but the title company does not represent the seller and I believe they need an advocate on their side.

Bad advice James. The last thing you want to do is get an attorney involved. They are trouble makers not problem solvers. They are ignorant about short sales, it's a financial negotiation not a legal matter. Calling in a lawyer is like feeding a child lead based paint.