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Does My Short Sale Lawyer Represent My Interest? 7/24/2011

Does My Short Sale Lawyer Represent My Interest?

I am contacted often by those facing foreclosure and contemplating a short sale as an alternative to foreclosure and bankruptcy.  Recently many potential clients have listed their properties with real estate brokers and have not retained an attorney to represent them early in the process.  In many cases the real estate agent or office has allegedly retained an attorney or has one on staff to assist in the short sale and this is often sold to the potential client as a way to save money and time.  However, these attorneys do not represent the sellers but instead represent the real estate company.  This is critical and often sellers have no idea of the nature of the relationship and what is actually being provided.  

Should the property go into foreclosure an attorney in should be retained in many cases to protect the interest of the seller and to attempt to resolve the matter before the home is set for sale.  A real estate office and their in-house attorney cannot be relied on for this representation because this is not their role in most cases.  

The listing agreement, the purchase contract, the closing documents and many other legally binding agreements should be reviewed carefully at each stage to ensure the rights of those seeking assistance are protected.  Retaining a competent foreclosure lawyer who handles short sales is often a good choice in these transactions and they may be able to provide valuable services.

One of the most critical issues and subjects of negotiation is the waiver of a deficiency and further liability after the conclusion of the short sale.  In many cases the lenders will issue and approval letter regarding the short sale explaining important requirements and rights related to the short sale.  Whether or not the mortgage holders have agreed to approve the short sale and a lien release versus approving the short sale with a lien release and full waiver of a any deficiency is the most important aspect and determination contained in these approval letters.  In many cases the approval letters are poorly written or the lender is attempting to be vague about the deficiency using wording that is not clear on the issue.  Unfortunately, many sellers have mistakenly believed that they obtained a waiver of deficiency only to find out after closing that all the received was a lien release and are still liable or the balance.

The negotiations involved in a short sale are frustrating and time consuming but it is often well worth the money to obtain competent legal advice as the the issues involved in the short sale, deficiency rights, and tax consequences of the transaction.  These issues are often simply beyond the expertise of a real estate agent.

Remember that in most cases realtors dont get a commission unless the sale closes so consider the possibility that closing to some realtors may be more important that your future liability and in some cases attorneys are seen as an impediment to a pay check.  Be careful when selecting real estate professionals whether they be real estate agent, lawyers, or mortgage brokers.  Know your rights and options.

Contact a short sale attorney or short sale lawyer at Tiller Law today for your free consultation regarding your options. Serving Miami, Fort Lauderdale, Hollywood, Boca Raton, West Palm Beach, Palm Beach Gardens, Jupiter, Hobe Sound, Stuart, Port St. Lucie, St. Petersburg and Tampa and throughout the State of Florida. 

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