Home > Blogs > California > Los Angeles County > La Crescenta > Home Buyers and Sellers Beware; Some Corrupt Agents Are Manipulating Offers!
10,052 views

Jeero Habeshian The Glencrest Team's Blog

By Jeero Habeshian | Managing Broker in La Crescenta, CA

Home Buyers and Sellers Beware; Some Corrupt Agents Are Manipulating Offers!

Home Buyers and Sellers Beware; Some Corrupt Agents Are Manipulating Offers!

 

There’s an epidemic tainting real estate sales. Listing agents are cheating sellers and buyers by manipulating offers. Agents across the country are complaining about their unethical counterparts’ practices!

 

I am beginning to see an ugly side of the real estate turnaround. A couple of our buyer clients, both families, have to buy ASAP and we have been seeing houses and submitting offers as fast as possible. Multiple offers are again the norm. “This is good and bad,” said a local mega agent colleague when I asked him about the seemingly overnight turnaround. The good is obvious, and I ALWAYS write about the good. That’s my nature! However, because it is imperative that consumers are aware of what is happening, this blog is about the bad! Please allow me to re-create one of our resent experiences.

 

We submit an offer on a property that, per the agent, has been approved by the bank for a short sale. Understanding the market, the buyers agree to offer more than the bank’s approved short sale price. The agent prefers e-mail offers and we submit ours on a Friday. I call to ask if offer has been received and agent says “I’m sure I have. I will call you if not.” Monday afternoon I follow up and agent says they never got our e-mail and have accepted another offer. I say this is unacceptable and the buyers want an explanation. Agent begrudgingly agrees to present our offer to the seller, and then e-mails back to say that the seller accepts the other offer. I ask why? Agent says the seller nets more with the other offer. I ask who submitted the other offer, and agent asks “Why do you need to know that.”

 

I need to know that because the bank, the seller, and our buyers have a vested interest. If you were the bank and the seller, wouldn’t you counter all parties soliciting a best and final offer? Can you imagine a bank or the investor leaving money on the table when they are already taking a $200,000 hit? The agent either did not submit our offer, or steered the seller towards another that is in agent’s best interest!

 

A second breed of corrupt agents work another way; they are invisible! They place a property in the Multiple Listing Service, and if possible, not the one in the area of the property listed. They often don’t provide photos of homes, and they offer a telephone number with a voice mail box that is usually full. You are more likely to get a call from the International Space Station. This just in…Now some of these agents refuse to give you a phone number. E-Mail only please, and then they don't reply to e-mails!

 

So, sellers and buyers, I ask you: Do you want these agents representing your interests?

 

CA Civil Code Section 1102.3 states that “the general laws of agency require a real estate agent to disclose to his or her principal any material fact the agent knows (or should know) which will affect the principal’s decisions in a transaction. In this regard, a good policy is: when in doubt, disclose.”

 

Further, California Department of Real Estate law requires MLS regulations to define presentation of offers. These regulations state that unless Instructed Not To by a seller, a listing agent must continue to submit all offers to a seller until transfer of title and the close of escrow.

 

Here is what I would do as a Seller or Buyer:

 

Interview REALTORS® and work with one that promises to work for you. Obvious? It is the law, but so is the 65 MPH speed limit. Ask for testimonials and contact them. Be engaged and involved in the transaction. Sellers: Demand to see all offers. Agents are required to present all offers to you until escrow close or you instruct them not to. Remember if something goes wrong, you are liable!

 

If you suspect misconduct from a real estate agent, click on the link below and file a complaint with the CA Department of Real Estate.

 

CA DRE Complaint

 
Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer