Real estate licensees come into contact with foreclosure consultants and mitigation experts because most “rescues” involve trying to sell the property usually as a short sale. The involvement of foreclosure consultants or loss mitigation experts in real estate sales conducted through real estate licensees raises serious risk management and business issues for the licensees involved. Licensees must be aware of potential for involvement in fraud. Even if no fraud is involved, potentially difficult agency issues can arise when the seller has hired a foreclosure consultant. The viability of listings involving foreclosure consultants must always be assessed from a business as well as a legal and risk management point of view.

Most foreclosure consultants are not licensed to practice real estate. That means sharing any part of a commission, or even promising to share any part of a commission, is illegal. Foreclosure consultant will sometimes have schemes for evading the commission sharing rule. Some of these may, depending on how exactly they work, be legal if the payment comes from a party to the contract rather than the agent. Such arrangements, however, will tend to tie the agent to the consultant’s business and business practices. No agent should even agree to any arrangement regarding the commission when a foreclosure consultant is involved without first checking with their principal broker.
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