Wednesday, September 25, 2013

HUD's New Deadly Short Sale Rule


Click here to give me your comments

So we all know that short sale fraud is in the Real Estate industry. We read about it in the news from time to time. So HUD has a NEW Rule that is slated to start on October 1st. It’s a rule that frankly is going to severely limit the number of real estate agents willing to take them.
I came across this story at Inman News about HUD’s new short sale rule. It says that if you list a HUD short sale (that is a property that has an FHA loan on it), you can’t represent the buyer on the property as well. Not so bad right? I mean, I could see that you might be able to commit some kind of HUD short sale fraud on a deal like that. You’re controlling both sides so you can work a little naughty magic if you’re so inclined.
So yes, by all means, the listing agent of a HUD short sale shouldn’t be able to represent the buyer as well. I get it.
 Problem is, the rule isn’t quite set up that way. It appears that HUD is stating that if an agent takes a HUD short sale listing, no other agent from that entire company can represent the buyer
So Yeah, goes like this…… you’ve got an office of 1500 agents, one of them gets a HUD short sale listing, and now no one else in your entire 1500 agent office can represent the buyer on the deal? Brilliant! So as a consumer, the goal would be to NOT list your HUD short sale with the biggest real estate company in town because you’ve now ensured that at least 1500 agents can’t sell it if you do!