With all the ups and downs and emotional roller coasters encountered by real estate practitioners in the normal course of events of real estate, they are particularly acute while serving in the role of representative in the experience of a Short Sale transaction. The pressures felt by the REALTOR® while trying to help the client, whether seller or buyer, are very intense during the usual and customary processes of real estate, but the human characteristics become very personal and sensitive when it comes to the Short Sale, especially to the agent for the seller.
It is the seller who is on the verge of losing the property, usually the personal residence, and face foreclosure, if there is not some solution to solve the delinquency status. The seller is looking for a miracle of some sort. The REALTOR® is looked to for alternative options for the seller.
One of the efforts waged by both the seller/borrower and the REALTOR® is trying to get the lender to restructure the loan to provide relief with a payment manageable in order that the borrower/owner may keep the property. The lender workout, and this is not referring to an experience at the athletic gym, that the lender may entertain, is not a transaction where the real estate professional may act as agent on behalf of the client. Most states look at the lender workout as a real estate transaction and a real estate professional who attempts to broker such a deal could be considered to be practicing law without a license.
The condition of loan delinquency carries tremendous pressure and stress, particularly if the owner/occupant involves a family and children. It is hard on the parents who face the potential of losing the home, losing the equity in the property, and having negative impact upon their credit. But when children are involved and realize the family is about to lose the house and be out on the street, the picture is not pretty. When the children appeal to the parents with quarries of: "What is going to happen to us, Daddy?" or "Where are we going, Mommy?" the agent is often involved in the personal evaluations.
The agent, because of the legal position involved, must exercise great care amidst the pool of emotion. It is easy to try to be the means of trying almost anything to try to help the family out of this unfortunate and very unpleasant situation. The licensee has limitations of what can be done within the fiduciary position of agent. One must be very careful to not go beyond the boundaries of real estate practitioner and cross over into the areas of tax, credit, financial and legal counsel.
Consequently, in as much as the process of working through the delinquency condition is very "ify," and the possibilities of accomplishing a successful short sale are very tenuous, and the agent has to balance the concern of doing everything practical and legal while managing the risk of liability exposure, the REALTOR® may be looked upon as a hero or a hindrance. The REALTOR® is duty-bound to act with prudence and professional care in the discharge of responsibilities assumed as a licensee without going beyond the scope of the law and license restrictions.
St. George REALTOR® Jim Coleman is Associate Broker and Partner/Owner of ERA Brokers Consolidated. He Specializes in Residential, Investment and Commercial Real Estate, holding National Designations of Accredited Buyers Representative (ABR), Certified Residential Specialist (CRS), Resort and Second Home Property Specialist (RSPS), Seniors Real Estate Specialist (SRES), Certified International Property Specialist (CIPS), GREEN Property Specialist, and Certified Short Sale and Foreclosure Resource Specialist (SFR). You can contact him by e-mail at Jim@JimColeman4Homes.com. Call: (435) 674-0600; or write: Jim Coleman, 201 East St. George Boulevard, St. George, Utah 84770. This and other columns are available at www.WinningTalk.com/articles.