Is Real Estate License Needed To Negotiate Short Sales or Loan Modification?

Loan Modifications

A real estate license is not required to negotiate a loan modification agreement for a client because the typical loan modification does not involve the sale of real property. See A.R.S. § 32-2101(47). In addition, a mortgage broker’s license is not required to negotiate a loan modification if the loan is already funded, the parties to and the security for the loan are the same, and no additional funds are advanced. See A.A.C. R20-4-102. However, Arizona did adopt legislation that required loan modification negotiators to be licensed and regulated under the mortgage brokerage statutes by July 2010.

Short Sales

A real estate license is generally required to represent a client in a “transaction calculated or intended to result in the sale . . . of real estate.” See A.R.S. § 32-2101(47). Therefore, any directing or assisting in the negotiations for a short sale on behalf of a seller and for compensation is an activity requiring a real estate license. See also A.R.S. § 32-2122(D).

Combs Law Group (CLG)as a law firm exempt from real estate license requirements is uniquely qualified to represent clients and assist brokers in short sale transactions. There is no program, whether sponsored by the government or a private lender, which fits every client’s circumstance. CLG’s attorneys evaluate each client’s circumstances, educate the client regarding the law, provide the client with all of the options that are available, and work with the lender to close the short sale transaction prior to closing. All short sale clients receive a thorough review of their short sale documents by a CLG attorney to ensure that their best interests are protected and promoted.

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