Short Sale Agreement outside Agreement of Sale – Is this normal

[Jim Mckenna]

BP, I would like your opinion, I am interested in purchasing a property that  is being offer for short sale by a seller’s agent. My agent has contacted the listing agent and was supplied a “Foreclosure Agreement” that need to be a separate agreement along with the Agreement of sale. Is this standard practice ? my realtor says no, and lawyer says if I agree to these items they should all be in one document, the Agreement of sale…… I’m still little confused because who ultimately executes the agreement of sale because it’s not up the buyer, it would be the lien holder.

Basically am prepared to commit to the property at a certain price. My concern is that the lien holder rejects my offer, and counters at a price that I don’t feel comfortable paying for the property and the seller/sellers agent will keep the negotiation fee and good faith money.

The “Foreclosure Agreement” is also contradictor because it states that you do not owe the fee if settlement does not take place due to no fault of the buyer. However, the fee must be paid before settlement. So if you paid the fee and settlement did not take place, then?

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*The Buyer will be responsible for any attorney and/or negotiating fees Not Covered by the lien holder, not to exceed the greater of 1% of sale price or $4500. The buyer is Not responsible if there is no settlement due to the seller or lien holder.

* The negotiating fee is due upon receipt of a "Short Sale" approval letter of acceptance from the lien holder Not at settlement.

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Is it out of line to ask for the  “negotiating fee” is placed in escrow payable at time of settlement?  or should I just run for this deal?