Question: How much does it cost to list your Escondido short sale?
Answer: Nothing!
In San Diego County right now, there are over 3000 active and contingent short sale listings for sale.* Some parts of San Diego County have more short sales then others. Escondido has more short sale listings then some of those other communities.
One of the agents in my office took a short sale listing recently and the seller had some very good questions about costs. The seller was concerned about the commission. This seller wanted to know how much it would cost to list his Escondido short sale.
Great question with a simple answer. In a traditional short sale, the commission is paid from the seller’s proceeds. In a short sale, there are no seller proceeds since the seller owes more on the home than it is worth. So, in a short sale, the mortgage lender pays the commission out of the proceeds.
The next question that came up was with regard to the listing agreement. If the seller agrees to a 6 percent commission on the listing agreement and the mortgage lender approves less, who must pay the difference?
If the mortgage lender happens to reduce the commission below the amount on the listing agreement, then the agent will only earn the commission approved by the seller’s lien holder. By law, all costs associated with a short sale must be reported on the final settlement statement at closing. This includes all commissions paid to listing and selling agents. Because of this, the seller would not be responsible for the difference between the commission on the signed listing agreement and the approved commission on the short sale approval letter.
There are other costs associated with an Escondido short sale. These may include Homeowner’s Association dues, title insurance, home warranty, and escrow. Each short sale is unique and the amount approved by the lien holder is different on each and every short sale. Generally, most of these costs are paid for by the mortgage lender. However, if you have your home listed as an Escondido short sale and have received a short sale approval letter, it is a good idea to review the costs with your Realtor® and your escrow officer just to make sure that there are no unanticipated expenses at close of escrow.
*Statistics are obtained from Sandicor Multiple Listing Service. ‘Active’ refers to properties with no buyer. ‘Contingent’ refers to short sales with an accepted offer, currently waiting lender approval.
