Many real estate agents in Washington State use unlicensed
third-party negotiators to handle their short sales. I have always discouraged that practice (see my March, 2009 blog post,
Is Your Real Estate Agent Breaking The Law?).

The Washington State Department of Licensing has now taken an official stance on this. On their website under “
New Real Estate Law Frequently Asked Questions”, they state that
short sale negotiators must hold active real estate licenses or be appropriately licensed by the Department of Financial Institutions,
and
work under the authority of their designated broker. The department of
licensing is currently investigating complaints of unlicensed
short sale negotiators (see
Real Estate Commission Meeting Minutes).
Real
estate agents who are using unlicensed short sale negotiators can be
charged with aiding or abetting unlicensed activity and are subject to
disciplinary action, according to the Department of Licensing.
Unlicensed
third-party short sale negotiators
are responding by stating that they’re really “facilitators”, not
“negotiators”. That may technically be true, but that doesn’t mean
that the state sees it that way. I certainly wouldn’t want to be
standing in front of a judge trying to explain the difference between
“facilitating” and “negotiating”. And as a real estate licensee, I
wouldn’t want to risk my license being suspended while my relationship
with an unlicensed
short sale negotiator is being investigated.
I use an experienced
short sale attorney
to handle my short sales. My attorney also happens to have a real
estate license, in addition to being an escrow attorney. He was
working with short sales before most real estate agents even knew what
a short sale was. If you’re a
real estate agent in the Seattle-Tacoma-Everett area reading this, I would be happy to refer you to the
short sale attorney that I use, no strings attached--I can’t receive any payment for an attorney referral. (See
Short Sales For Real Estate Agents
for more information.) As real estate agents, we need to keep our
business practices above-board and eliminate opportunities for any bad
press relating to real estate agents. Would you put your license at
risk?