I have never heard of this... where is your buyers agent assist with all these questions?

All sales go thru a title company who transfer money to lender.

National Featured Realtor and Consultant, Mortgage Loan Officer, Credit Repair Lecturer
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Lynn911

The following isn't legal advice; I'm simply providing my own opinion.

Basically, any transfer of cash that's not disclosed on the HUD-1 in that transaction is a form of mortgage fraud.

Recently, while working on a particular short-sale (as an investor), I also had a seller ask me to do something similar--at least 3 different ways. I warned him each time that his request was a case of mortgage fraud, and I even pasted a link (the first time), so that he'd know that I knew what I was talking about. Unfortunately, he ignored my warnings, so I opted for a slightly different approach. I told him that I didn't think I'd look good in an orange jumpsuit, that I wasn't anxious to try one on, and that I'd stick with doing a plain vanilla short-sale.

Hi,

Your question is a little unclear. If the agent and/or owner is asking for you to give the seller cash that their lender would be unaware of in addition to the contract price on the house, this does sound like something that is not legal. Typically in a short sale, the seller does not receive any proceeds cash or otherwise from the sale. I think this is a question for your real estate attorney. You are very prudent to question anything that seems like fraud.


Marion Digre
Broker/Co-Owner
Accredited Buyer Representative (ABR)
Certified Distressed Property Expert (CDPE)
Remax In The Village, Realtors
189 S. Oak Park Ave.
Oak Park, IL 60302
708-386-1400 Ext. 111 http://www.OakParkHome.com

In short sales, the only time we use contract addendums (not a bill of sale) is when there are 2+ mortgages on the property and the 2nd lender is unlikely to release the lien without additional funds. We recommend that the buyers structure their offer to account for this, but it is not a requirement. No cash is being given back to the seller for any reason...

If you'd like a legal opinion on this, I'd be happy to introduce you to a great local real estate attorney.

Best of luck!

Laurie, Buyer Specialist w/ The Pych Team @ RE/MAX In The Village