A short pay/negotiated settlement conducted by a short sale certified, licensed real estate agent is a no-cost service to the homeowner. Except for a few quick fixes and advice on curb appeal, the property is commonly conveyed “as-is” so the seller is not responsible for costly repairs during the escrow process. The real estate agent’s commission is paid by the bank, not the homeowner. An experienced real estate brokerage and listing agent can achieve better results than an expensive law firm.

An attorney-negotiated settlement usually costs thousands up front to the homeowner (often $3,000-$6,000), and sometimes on a per month basis ($500/mo). Attorney fees are also applied to the transaction, with some firms charging the bank thousands on the back end at close. The bank obviously hates this, and often prefers not to involve law firms because of increased red tape, communication problems and a lower bottom line. Many struggling homeowners are under the wrong impression that law firms are better suited and have a higher chance of success negotiating the settlement, but this is simply incorrect.