Bulletin: WI2011001

Dear Associates:    

Short sale transactions (also known as short payoffs) may be locally referred to as 2-party or 3-party short sales. A 2- party short sale transaction involves a direct sale of the property to the ultimate purchaser. If a "negotiator" is employed by the seller to negotiate the sale for a fee, a line item should be reflected on the HUD for such fee. If requested to insure a 2-party transaction, please refer to existing company guidelines contained in Stewart Bulletins SLS2011007 and SLS2009005.

A 3-party short sale involves a 3rd party - sometimes referred to as a "servicer" or "intervener" who not only negotiates the terms of the short sale with the underlying lender but will arrange to take title to the property before it is sold to the ultimate purchaser. There are always 2 transfers in a 3-party transaction. You may not insure a 3-party short sale transaction without written approval from a Wisconsin Underwriter on a file by file basis. Please review Stewart Bulletin SLS00234 on Loan Fraud.

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.