New Short-Sale Contracts Upsetting Realtors

Some real estate agents are concerned about short sales contracts from Bank of America and Wells Fargo that aim to prevent “flopping” by requiring them to certify under penalty of perjury that the transactions are “arms length” and that properties will not be resold within 30 to 90 days. Agents say the contracts require Realtors to do more due diligence and assume more of the financial burden and liability of short sales. They are concerned because investors represent a large number of buyers, and higher price offers may not be in the client’s best interest — as there could be a contingency clause based on the sale of the buyer’s home or the closing date may not be suitable. It may be difficult for agents to avoid these contracts, given that the two banks control much of the market, so agents say they should ensure that buyers and sellers are not related and inquire about their motives. Some believe banks should cover appraisals to deter flipping and flopping and reduce agent liability. | Read More