Short Sale and The Realtor/Owner

By
Real Estate Agent with Grand View North Realty

I know there's got to be agents out there somewhere who have been through this...had a short sale where the owner was a realtor. I looked high and low a few months back to find an experience that someone else may have gone through without any luck. Consistent research and then numerous phone calls later, my search paid off when I was informed time and time again that the decision I made was the right one!

In the winter of this year, I had a friend who was also a real estate agent (not active with any office in our area) ask me to handle the short sale of two of his properties. There was definite financial hardship (loss of a job, loss of all equity in these properties, BK, etc.), so I took on the challenge. About 30 days into the first listing, an offer was received. At the same time I got an interesting call from the seller/real estate agent if I would do a 25% referral on the selling end. 

We all know (or do we) that in any Short Sale transaction the SELLER CANNOT BENEFIT FINANCIALLY FROM A SHORT SALE. I explained this to the seller and thought that was the end of the conversation until the escrow closed and the monster came out of the closet! I started receiving emails, 6-7 a day, from this agent harassing and bullying me into paying the 25% referral, stating that "who would know" if I wrote him a check or paid him cash. This was an agent who at one time preached to me the importance of ETHICS in this industry and to always follow the rules. When I emailed the Short Sale Negotiator from the bank that was being "shorted", it was again confirmed that this was not allowed and considered fraud.

So what would you have done? Paid out a referral and risked your license? Or would you have risked losing a friend and colleague? I endured harassing emails from this seller for almost 3 months before I finally had had enough...one more email and I would take this to the Department of Real Estate and file a complaint. It stopped immediately.

What did I learn from this? That always go with your gut instincts. I kept trying to find another professional in this industry to confirm what I knew was not only right, ethically and morally, but against the law if it was done. Hopefully this will help another agent who may be in the same situation now or in the near future. Is it worth risking your license?!

Comments (4)

Gabrielle Nemes
RE/MAX Realty South - Tumwater, WA
206.300.8421, S King & Pierce County RE Advocate

Wow! I can't say I've ever even given this any thought. I think I might have gone to the agent's broker ...

Aug 31, 2010 04:36 AM
Todd & Devona Garrigus
Garrigus Real Estate - Beaumont, CA
Broker / REALTORS®

Lisa - No its not worth your license. And this friend is not a true friend for asking you to risk your license just to put cash in their pocket- and take cash from yours for a hard transaction like a short sale! It also sounds like their bullying technique wasn't just intentional, but down-right bold and aggressive!

Good riddance! You did the right thing by threatening the DRE card. And you have plenty of proof via their emails!

Aug 31, 2010 04:38 AM
Terry McCarley
Coastal Real Estate - Cape Coral FL - Cape Coral, FL
REALTOR, SRES, CDPE - Cape Coral, FL

Lisa - Good for you!  It is not worth losing your license over and if she were a true friend she wouldn't have even put you in that situation in the first place.

Aug 31, 2010 04:44 AM
Harley Wilcox
West Group Real Estate - Victor, ID
Harley Wilcox

A good friend does not ask you to do something not right. Good way to find out who your friends are.

Aug 24, 2011 09:41 AM