Switching Sacramento Short Sale Agents

Does it take two to Tango to cancel a Sacramento short sale contract and switch short sale agents? Depends on the circumstances. It is possible to cancel a short sale contract without signatures from both the buyer and the seller. As a Sacramento short sale agent, on occasion, I have advised my sellers to cancel a non-performing buyer when the buyer has resisted cancellation and repeatedly refused to perform. On the other hand, if a buyer is agreeable to the terms and conditions of the contract, one can’t really kick the buyer out of the contract for no reason, especially if the buyer is clinging by her bloody fingernails to the door frame.

Buyers have certain rights in a purchase contract. Sometimes, the parties to a short sale get confused between the rights of a listing agent, for example, and the rights of a buyer in a purchase contract. A listing agreement is not a purchase contract. These are 2 separate documents. The common element in both, of course, is the seller. The seller signs a listing agreement with the listing agent, but that agreement does not really involve the buyer. The seller also signs a purchase contract with a buyer, which does not really involve the listing agent. If a seller cancels a short sale, a seller needs to cancel both the listing agreement and the purchase contract. Therein lies a possible complication.

Without a listing agreement in place, the buyer’s agent might not be entitled to a commission. However, the buyer and the seller can be still bound to each other through the purchase contract. If the buyer has not breached the contract and desires to move forward, it can cause problems if the seller wants to cancel. However, it is unlikely a court would force a seller who does not want to short sale to short sale. A short sale is a voluntary action. It’s another story, though, if the seller wants to sell to a different buyer. This is why it’s advisable for all parties to obtain legal advice in the event of a contested cancellation.

Sometimes, a seller comes to me and asks me to pick up a failed short sale and list that short sale. For whatever reason, the previous Sacramento short sale agent failed to close the short sale. It’s more common than you would think, as there are agents who will list a short sale who have never sold a short sale. When switching short sale agents, it’s important to ensure the previous agent has no claim to a previous contract with an old buyer, particularly if this old buyer might want to pursue a new purchase contract. It’s also imperative that there are no existing purchase contracts on the table. Both the seller and the previous listing agent must sign mutual cancellation instructions. The listing must be removed from MLS.

When a seller has canceled the listing agreement, canceled the purchase contract and has no listing entered into MLS, then I am most likely happy to take on that Sacramento short sale and get it closed. But please don’t call me in the middle of your transaction and ask for advice when I do not represent you as your Sacramento short sale agent. In that event, I am not allowed to help you.

It’s not that I am purposely being cruel or obstinate — I sense your feeling of desperation — but the REALTOR Code of Ethics says I cannot interfere in another agent’s transaction. I am not a lawyer. I cannot give legal advice. But I can and do close many Sacramento short sales.