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| A Quarterly Publication of the Raleigh Regional Association of REALTORS® |
April 2009 Issue
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About Us March Dates to Remember
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The ins and outs of short sales Never closed a short sale? According to the North Carolina Association of REALTORS® (NCAR), this type of transaction is occurring at an increasing rate. Even so, many agents may not be familiar with the specifics. Simply put, a short sale occurs when a lender accepts less than the total amount due on a loan. Sometimes a lender will allow a short sale to avoid a foreclosure. This means a buyer could purchase a home for less than the mortgage balance while the home is in the pre-foreclosure stage. For a REALTOR®, a short sale also means more paper work and uncertainty over the closing date. REALTORS® are required to note a short sale in the “Agents Only” field to comply with Triangle MLS rules and National Association of REALTORS® (NAR) policy. The seller accepts a buyer’s offer to purchase. The seller’s lender must then accept the buyer’s purchase offer. If all goes well the buyer gets a loan, the lender agrees to the sale, and the seller delivers the deed. According to NCAR, REALTORS® increasingly face these circumstances. Two new short sale addenda and a revised listing agreement have been developed to help members better handle short sales. The Short Sale Addendum to the Offer to Purchase and Contract establishes important contractual rights of the parties to the short sale. It also helps educate the parties about the process and potential consequences of a short sale so that any decision made will be a well-informed one. The other short sale addendum is to the Exclusive Right to Sell Listing Agreement. The main purpose is to educate the seller about short sales: what they are, the potential alternatives and consequences of a short sale, what a lien holder may or may not agree to do, and what the seller’s responsibilities will be. This addendum also includes language which gives the firm the right to communicate directly with and provide information to any lien holders. Also added to the forms library is a new Seller Estimated Net Sheet. It helps the listing agent determine whether any sale of the seller’s property will be a short sale. The best advice for any agent interested in working with a buyer or a seller in a short sale situation is to take one of the many continuing education (CE) courses being offered. Also, for your own protection and to avoid liability, advise your client to obtain legal advice from a competent real estate attorney and an accountant to discuss short sale tax ramifications.
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| Raleigh
Regional Association of REALTORS® | Phone:
919.654.5400 Fax: 919-654.5401 |