Just like any profession, some Short Sale Negotiators are reputable and qualified to negotiate and facilitate Short Sales whereas others are not. And home owners have little tools to identify the qualified one’s from posers.
Scammers solicit homeowners and their agents into their schemes by promising to expedite the short sale process and obtain approval from the short sale lender. Some of these negotiators do package a file and submit it, but some perform little or not service.
Some scams revolve around the payment of the short sale negotiator’s fee. Some Short Sale lenders may disapprove payment to a third-party Short Sale negotiator, so the scammer makes a secret agreement for the seller, buyer, agent, or someone else to pay that fee, usually outside of escrow.
A variation of the scheme might be where the purchase agreement may indicate that the seller will give the buyer a credit, but a secret agreement is made for the buyer to use that credit to surreptitiously pay the Short Sale negotiator fee.
Sellers would be well advised to contact Deparment of Housing and Urban Development and get a counselor assigned to them to explore ALL of their options to avoid Foreclosures. But the fact remains that if the Sellers are working with a qualified Short Sale agent, they do NOT need to hire or pay for a Third Party Negotiator to help them with their file.
Bottom line is that Sellers are well served to avoid making ANY upfront payment for Short Sale services and if their Short Sale agent has indeed retained a Third Party Firm to negotiate with the lender, the agent should be able to justify such an assignment of the responsibility since the success and failure of the Short Sale Negotiations now rest with a Third Party company with only a monetary link to the file.