The fact of the matter is that agents and brokers are required to only give out and post factual information. This is regulated by Board of Realtors, as well as the state licensing division. Every multiple listing service has a requirement that all data be accurate, price and co-op commission included. It has been ruled in many cases throughout the country that when a certain co-op commission is quoted on the MLS, and then a different amount is offered by the listing broker upon receipt and acceptance of an offer, unless the selling broker agrees to the new co-op amount, the listing broker remains liable in arbitration for the original co-op amount advertised in the MLS. Teaser co-op splits have been deemed unethical by many boards, and have forced the listing brokers to pay the original co-op they were committed to.
Short sales are not very complicated as they simply require any mortgage holders to agree to an amount that is less than what they are owed. Lenders have placed some parameters on both the amount the seller can contribute towards closing costs, as the seller in reality is not contributing anything as this amount is simply another reduction in the proceeds to the lender or lenders, as well as a cap on the real estate commission. also, the closing statement must zero out the seller, in other words, the seller cannot receive any proceeds or benefits from the sale and closing other than a release of the property to the new buyer. The seller is also issued a 1099 for the deficiency to the lenders, the difference between what was owed and what the lender settled for.
Lenders today have realized that a short sale is far better than having to deal with a foreclosure. Every lender or mortgage servicing company has a loss mitigation department that specifically handles these situations. That is the department that will review and consider any contract offers. Short sales must be noted as that in the MLS and sellers should not accept any offers unless it is contingent upon the further acceptance of any lenders involved. The posting of a low price by the listing agent is a serious problem and is a deceptive practice, not allowed by any state licensing division and certainly not allowed by any Board of Realtors.
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