Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,957 posts, read 22,309,298 times
Reputation: 6471
Advertisements
We were kicking this one around the office today.
I owe my principal a fiduciary responsibility in a normal sale, but if the seller isn't going to receive any money at close, is there a fiduciary obligation created? Would the fiduciary obligation transfer to to the lender? (we assume not).
If you represent the seller your fiduciary duty stays with them. The goal with a regular sale is to get your client the best terms possible for market conditions. The goal with a short sale is to find a buyer and close the deal which saves your client's credit a bit. This is to your client's benefit. The fiduciary duty is to help your client, as best you can, achieve the outcome they want.
I completely agree with Silverfall -- you are never working "for the lender" as much of the time the lender may be "with you or against you". The "FMV" remains what the deal will CLOSE at, not the amount owed, or the amount the lender was hoping for.
The DATA you present to support any offer from potential buyers is going to support the offer with comps and adjustments, not whatever the lender may be on the hook for...
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,957 posts, read 22,309,298 times
Reputation: 6471
Thanks SF for that bit about their credit. I know that it wouldn't change the way I approach a seller in a short sale, I guess we all just missed the credit aspect in our "hot stove league" discussion. It's still an interesting concept, I wonder when the first case law will make it to an appeals court. (if it hasn't already)
It does not matter whether there are proceeds to be had or not. Getting the best price and to the closing table with the least amount of hassles is still the goal.
Market conditions make the property a short sale. The seller is still a person who needs our guidance.
A short sale seller needs recommendations to a bk, real estate attorney, and a cpa - or other tax professional.
Your fiduciary is still to your seller. Now, in a short sale, the seller's best interest is to get the house sold. If it's for $1, it's for $1. Usually in short sales, I'll work with the buyer's agent to get their contract through. The seller just needs to get out of the house. Your fiduciary is to the seller, but sometimes that means helping the purchasing party as much as possible.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
