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If you are a real estate agent or a Realtor® in anywhere in San Diego County, you will want to read this information provided by a California transaction coordinator. This California transaction coordinator is often asked about San Diego short sale transactions and short sale negotiation fees.

The Sandicor Multiple Listing Service put out a statement over two years ago with respect to San Diego short sale transactions and short sale fees, and this San Diego transaction coordinator retained a copy.

Real estate agents and Realtors® are always curious as to the rules with respect to short sale negotiators and how to disclose information about fees on the multiple listing service.

According to an email from Sandicor dated February 1, 2011,

the California Association of Realtors (CAR) modified Rule 7.15.2. The CAR rules were changed in December 2010 and the Sandicor Board of Directors adopted the Model Rule in January 2011. The changes have been highlighted for your review.

7.15.2 Lender Approval Listings. Compensation offered through the MLS to cooperating brokers on listings which require lender approval (commonly referred to as “short sale” listings) is for the amount published therein unless the listing broker indicates on the MLS the following: (a) the fact that the sale and gross commission are subject to lender approval; and (b) the amount or method by which the compensation offered through the MLS will be reduced if the lender reduces the gross commission.

This section does not allow an additional reduction from the commission offered for items such as a short sale negotiator fee or other administrative costs of the transaction. Any reductions from the commission offered for such items should be factored in as a reduced amount the listing broker initially offers to a cooperating broker and may not be made a condition of the offer.

The Compensation to Buyer’s Broker field (CBB) is an unconditional offer of compensation from the listing broker to the cooperating broker. The confidential remarks are not to be used to reduce the cooperating broker’s compensation for the use of a short sale negotiator or any other third party fee.

In a nutshell, this means that listing agents should offer a set amount in the Commission to Buyer’s Broker field (CBB) and then pay the negotiator from their portion of the commission. “Since some short sale lenders will reduce the commission, listing agents would need to plan accordingly,” says this California transaction coordinator.