MLS-PIN writes clear rules about short sales

MLS Property Information Network is the company that runs my multiple listing service. There is an ever-changing set of rules for using this database, which reflect changes in the marketplace.

The Network wrote to its agent-members:

SHORT SALES: While there is no prohibition from entering "short sales" into MLS Property Information Network, I must caution you that doing so without the list price being approved by the lending institution may leave you open to charges of misrepresentation by prospective buyers who feel they've been mislead. Understand, as well, as with any listing in the MLS, you are making an offer of compensation and may also be held to honoring that offer of compensation. In addition, if the lending institution requires pre-approval of the buyer before accepting offers, that needs to be disclosed as well. Cooperating agents need to know the requirements of the lending institution before working to produce the buyer!

Allow me to translate into English from broker-speak: Brokers may list foreclosing properties in the MLS. However, if the lender/seller rejects a full priced offer and asks for more, the buyer could sue you. If you offer a commission to a co-broker, then the lender/seller won't pay it, you may have to. If there are special rules regarding paperwork, you need to disclose them.

I've been seeing short sales since early this spring (this time, I saw many in the early 90s). They are tricky and often aggravating. My buyers have had their price raised after their offer was accepted (they could reject the counter-offer, but didn't), I have been asked to cut my commission (I didn't), I have not yet seen (this time) lenders who required that my buyers borrow from them, but that was common in the 90s.

Bravo, MLS-PIN, for policing your database so that it accurately reflects what is for sale, how much it will cost, and what the rules are for buying it.