Loss Mit Services

Only Three Companies in Connecticut Are Licensed to Negotiate Short Sales — Is Your Negotiator One of Them?

Posted on 23. Aug, 2026 by ctlms in Blog, Foreclosures, My Blog, News, Real Estate, Short Sale, foreclosure

I get this question from agents all the time: “Sean, does it really matter who negotiates the short sale? My seller found a company online.” The answer is... it matters more than almost anything else on the file, and here’s a number that should tell you why.

There are three companies in Connecticut licensed to negotiate a short sale on a homeowner’s behalf. Three. In the entire state.

And no, I’m not saying that from memory. I pulled the Department of Banking’s licensee list before writing this. One of the three is a national nonprofit housing counseling agency. Mine is one of the other two.

So what does the law actually say?

Simply put: in Connecticut, negotiating a short sale for a homeowner is “debt negotiation,” and debt negotiation requires a license.

That’s not my interpretation — it’s the plain text. Conn. Gen. Stat. Section 36a-671 defines “debt negotiation” to include “the negotiation of short sales of residential property.” Subsection (b) prohibits engaging in that business — or even offering to engage in it — without a license from the Department of Banking.

So then you ask, “if that’s true, how are there ‘short sale specialists’ advertising all over the place?” That is exactly the right question. The exemption list is short, and the Department of Banking publishes it right on its debt negotiator licensee page:

1. Attorneys practicing law in Connecticut. An attorney handling the negotiation as part of their law practice is exempt. Plenty of good short sales get done this way.

2. Banks and credit unions. They’re regulated separately.

3. Licensed debt adjusters. A different license, separately issued.

4. Nonprofits. Housing counseling agencies and the like.

Read that list again. Real estate brokers are not on it. A real estate license does not cover short sale negotiation in Connecticut. I hold broker licenses in three states, and none of them is the reason I’m allowed to negotiate your seller’s file — the debt negotiation license is.

“Okay, but it’s not my license on the line. Why do I care?”

Because the federal government thought of you too.

The MARS Rule — the FTC’s Mortgage Assistance Relief Services rule, now 12 CFR Part 1015 — has an assisting-and-facilitating provision at Section 1015.6. It reaches anyone who provides substantial assistance to a provider when they know, or consciously avoid knowing, that the provider is violating the rule. And the FTC’s own compliance guidance names supplying leads and referrals as an example of substantial assistance.

In plain English: the referral is the exposure. The agent who hands a homeowner to an unlicensed negotiator isn’t a bystander — they’re the one who made the introduction.

I’m not telling you who to work with, and I’m not going to name names. I’m telling you the list is public and the check takes ninety seconds on NMLS Consumer Access. If the negotiator isn’t licensed and doesn’t fit one of those four exemptions, ask them why not — then ask your broker or a real estate attorney what it means for you.

Why does the license exist in the first place?

Follow the incentives, because that’s what this law is really about. A homeowner in default is about the easiest person in the world to take advantage of. So the state wants somebody on the hook. The license comes with:

1. A surety bond. There’s money behind the license if something goes wrong.

2. An application and fitness review. The state looked at who’s running the company before saying yes.

3. A hard cap on fees charged to the homeowner — collectible only after all the contracted work is finished. Nobody licensed is taking an upfront fee from your seller.

What it buys you, the agent, is simpler: one settlement statement, with the same numbers going to every lienholder on the file. That’s how these files are supposed to run, and it’s the difference between a negotiation and the kind of two-sets-of-numbers arrangement that ends careers.

The takeaway

Before your seller signs anything with any short sale negotiator — me included — look them up. NMLS Consumer Access, ninety seconds. On the state’s list I appear as Accredited Home Services, LLC, which is the entity behind Loss Mit Services, license DN-828273 — the first debt negotiation license Connecticut issued after the requirement took effect in 2009.

And one more thing, so you hear it from me instead of at the closing table: lenders on these files sometimes require a commission reduction. That negotiation is part of the deal, not a surprise at the end.

If you’re sitting on a listing that smells like a short sale, send me the address and the approximate payoff. I’ll tell you within a day whether it’s worth pursuing.

As always, feel free to reach out to me with any questions.

Sean Wilder
Loss Mit Services
860-265-3727
CT Debt Negotiator NMLS #828273
Loss Mit Services is a dba of Accredited Home Services, LLC · CT Debt Negotiation License DN-828273