October/November 2011 Forms

Seller’s Listing Agreement with Shortsale Contingency / Authorization to Release Confidential Information to an Agent

An owner wanting to get out of his negative equity home meets with his real estate agent to discuss how he can sell it. The agent explains the process of the owner qualifying for a short payoff on the lender’s consent to the sales price once a buyer is located.

The agent, interested in listing the property as a shortsale:

enters into a listing agreement conditioned on negotiating a discounted payoff of the loan with the lender [See first tuesday Form 102-1]; and
obtains written authorization from the owner for the agent to negotiate with the lender to arrange for a short payoff on the owner’s behalf. [See first tuesday Form 124]

An agent listing a negative equity property needs authority from the owner to authorize the lender to release confidential loan information and carryout short pay arrangements with the agent. [See first tuesday Form 124]

On taking the listing with a shortpayoff contingency and receiving the seller’s authorization for the lender to release information to the agent, the seller’s agent immediately contacts the lender to discuss the steps the lender will take to proceed with qualifying the owner for a short payoff and the home for a shortsale. [For more information on the process of qualifying a negative-equity homeowner for a short payoff, see the September 2011 first tuesday article, How to facilitate a shortsale transaction.]

Editor’s note: Current first tuesday students and purchasers of first tuesday Forms-on-CD 4.3 may download a FREE copy of the brand new Seller’s Listing Agreement – Exclusive Right to Sell, Exchange or Option – With Shortsale Contingency [See first tuesday Form 102-1] and Authorization to Release Confidential Information [See first tuesday Form 124] designed for digital personalization, fill, print and save. Log into your student homepage at www.firsttuesday.us using your eight digit Department of Real Estate (DRE) license number or Temporary license number and click, “first tuesday Forms Downloads and Updates.”