RE

[Khari Harper]

How is it possible for the Agent to make money off a short sale? I am very confused. 

[David Dachtera]

Originally posted by @Khari Harper:

Okay so, lets say the house that I am selling which is my parents... The bank & I agree that on a short sale price of 145,000 & I sell it for 160,000 thousand, Where does the other 15 thousand go if the bank only wants 160k? @David Dachtera  

I'm just trying to get a better understanding, it's all just so confusing.

Back before and shortly after the crash, we saw a whole segment of the market pop up around short sale flipping. You may see it mentioned as an "A -> B -> C" transaction. Needless to say, the lenders didn't take kindly to it. They agreed on one price, then the buyer turned around and flipped it - without repairs - for a higher price. The lenders felt short-changed, and the justice department agreed with them, as did many key legislators and regulators.

So, in your statement, the "extra $15K" probably goes for bail and defense counsel for the defendant (the short-sale flipper, a.k.a. you).

To the point of your original question, "How is it possible for the Agent to make money off a short sale?", the answer is provided by Brent Coombs: the commission percentage is spelled out in the listing agreement required by the lender before they will consider a short-sale. The amount the lender agrees to takes this into account. The lender settles on an amount which nets the lender at closing the dollar figure they will accept.

David J Dachtera

"Success is not a destination. Failure is not an event. Success is a process, failure is a choice."
- DJ Benedict