Frequently Asked Questions for Brokers
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How can the lender modify the contract when they are not a party to it?
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Can I ask you a quick question about short sales or foreclosures?
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How can I begin working with your office to maximize my time?
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We are hired by the seller and coordinate with you as listing broker and your title company to get short sales closed. Our role is to educate the sellers about the foreclosure process, negotiate the offer(s) with their lenders, obtain the approvals and finally coordinate with your title company so the closing can go smoothly. Sometimes buyers and selling brokers have questions about the process and the status of their offer which we are always happy to answer and help guide all parties through the process.
If you are selling broker helping a buyer and have additional questions, please see the:
You certainly can, however, many brokers use us as a transaction coordinator so they can focus working with buyers, sellers and going to closings rather than spending their time on hold and going through the “brain damage” short sales can bring. Our negotiators do this full time and present professional short sale packages that rise to the “top of the pile” and get the attention of the loss mitigation departments.
We are paid 2% of the final purchase price from the Buyer. These fees are only earned if Foreclosure Brokers can obtain an approval letter on the offer from ALL lien holders and get the transaction to the closing table.
Buyers are not expected to pay more for the property because of the short sale negotiation fee. Instead, we recommend buyers simply request a 2% credit (concession) from the Seller in the offer to cover this closing cost. Additionally, most short sale properties are purchased below their true market value and our involvement will give you a full time negotiator working to get your offer approved.
We are brokers just like you and we hate reductions in commissions. As of right now, there are no file open, administration fees or any up-front fees and just like you we only get paid if we are successful.
What
happens to my commissions?
Frustratingly, many foreclosing lenders commonly do not allow a full 6% commission to be paid. Although our negotiators make every effort to preserve the normal and customary commission structure, lenders typically restrict them as follows: 5% when there are two separate brokerage offices involved in the transaction – one listing office, another selling office; 4% when there are two separate agents within one office, one listing agent, another selling agent; and 3% when the listing agent finds and sells to his/her own buyer.
We encourage selling brokers who are concerned about their commission to amend their contract with their buyer so that a portion of the commission is paid by your buyer directly. This can be easily solved by adding this amount as a seller concession. This way the seller is still "technically" paying it, but the foreclosing lender will typically agree.
How are Multiple Offers treated?
We are hired directly by the seller and begin coordinating the short sale immediately. Some transactions we are able to start working with the lender to complete the seller's financial review and property valuations steps prior to receiving an offer. (Such as HAFA, FHA and Cooperative Short Sales). Other times, we can only move forward once an offer is present.
Once an offer is presented to the bank(s) it typically takes between up to 30-75+ days for the final approval to be issued at which time the buyer can complete their due diligence and move towards closing. Most short sale approvals require the buyer to close within 30 days. If a foreclosure sale date is approaching within this timeframe the foreclosing lender will most likely postpone the sale date and allow enough time to close assuming the offer is "in the ball park". Give our office a call because each transaction is so different and we have fairly good idea of what timeframes we are facing on each file.
How can the lender modify the contract when they are not a party to it?
The foreclosing lenders commonly issue approvals that are out-of-touch with the contract or even reality. The approvals are based on their investor's or insurer's standards and policies and the contract may or may not conform. Many lenders have a "my way or the highway" mentality which forces buyer and seller to amend the contract once approvals are issued or the lender will not allow the closing. The most common examples of this are deadlines, commissions and the closing date.
Do you take any and every case?
Our minimum requirements are:
- Your sellers must either 1) be at least 30 days late and not planning to make any more payments, or 2) be able to show permanent hardship, where default is inevitable.
- Your sellers are motivated to stop their foreclosure and are willing to work on a solution.
- There are at least 60 days before the foreclosure sale (timeframes shorter that 60 days will be reviewed on a case-by-case basis and are only typically successful if you already received an offer).
- Any buyer coming forward with an offer must understand the potential timeline, our involvement and must be okay with paying our fee as part of the transaction.
- Contracts cannot be contingent on another sale, resale or have closings further out than 29 days from lender acceptance.
- Contracts cannot be assignable in any way.
- Buyer must not have any time constraints (e.g., needing to move right away, ending of lease, etc.) If this is the case, a short sale is probably not a good choice for your buyer.
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We find we have the best success if either you have plenty of time to market the property or already have an offer.
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Because of the potentially long processing timeframe, it is important for buyers to understand that patience is a crucial part of getting their offer accepted.
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Research the encumbrances for your property. If the property is encumbered by more than 3 mortgages or liens, we will only process it on a case-by-case basis. Quite often we are able to remove or discount IRS liens, Colorado Dept. of Revenue Liens and judgments but too many encumbrances can cause logistical problems.
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Because we contract directly with the seller, we must be able to speak directly with them throughout the process to keep them informed and to coordinate their paperwork directly.
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We are unable to guarantee any specific result, but since we don’t get paid until closing just like you, we are very persistent.
Do you pay referral fees for short sales?
Yes! If you have short sale referral, we will pay you 30% of the listing commission at closing. Take a look at our Referral Programs.
Do you have systems in place to help me manage buyers and updates?
Yes! We have internal software and we can send you a login so you see our real-time notes. Also, weekly updates are made to this website. See: Property Updates. We are happy to take the burden off of you by answering buyer's questions directly. Just give them our phone number.
Or Login Here:
This feature is only available for our Preferred Brokers, so if you are interested in learning more or becoming a Preferred Broker, give us a call - 303-399-7484.
Can I ask you a quick question about short sales or foreclosures?
Yes! Have a transaction that is giving you trouble and don't know what to do? Just ask:
What is the status of my buyer's offer?
Be sure to see our Property Updates page.
If you still can't find it, go to:
How can I begin working with your office to maximize my time?
We are constantly looking for new additions to our team of Preferred Brokers. If you are interested in having us negotiate and coordinate your short sales, please give us a call or send a quick email to PreferredBrokers@Foreclosure-Brokers.com. Please read through this site in its entirety because it answers many questions and you can have the greatest understanding of our systems and have questions prepared prior to contacting us.
Call us anytime- 303-399-7484