Home Buying in 80007>Question Details

Ddpetet, Home Buyer in Champaign, IL

We were interested in a foreclosure! We're told by listing agent would accept no offer except listing offer! This was listed in May! Made our offer to

Asked by Ddpetet, Champaign, IL Tue Jul 30, 2013

Agent full price and was told someone else just made full offer too!!! May turn into bidding war! Never heard of this!!! We are out!!!!

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Thanks for the question. A bidding war does not necessarily mean you will end up paying hundreds or thousands above a list price. I've experienced this a few times and as little as $50 over list price won a bid. Good luck to you!
0 votes Thank Flag Link Wed Jul 31, 2013
OK...do you have a question? Or do you just need to vent?
You've never heard of a bidding war?
0 votes Thank Flag Link Wed Jul 31, 2013
But all along, we thought your objective was to buy the house.
0 votes Thank Flag Link Wed Jul 31, 2013
I find the fact that the house has had no offers since May, and suddenly has two full price offers to be rather suspicious. There's one way to know... withdraw your offer, and see if they sell the home within 60 days! If not, then you may have a valid complaint.
0 votes Thank Flag Link Wed Jul 31, 2013
Hi Ddpetet, I’m sorry this happened to you but this why it did.

An agent representing the Seller has no fiduciary duty to a Buyer who wants to purchase his listing. However that agent does have a fiduciary duty to the Seller who owns that listing which includes selling the property for as much as possible.

Buyers often think they can negotiate a better deal with the seller if they are not represented by an agent because they think the seller will be more willing to negotiate because there is one less commission. However, the buyer’s agent is paid by the listing agent; the listing agent is paid by the Seller. The listing agent has a listing agreement with the seller separate to the purchase contract which specifically states what their commission will be , which by the way includes what the buyer’s agent (Cooperating Broker) will be paid. Therefore regardless of what the Seller agrees to sell their home for the listing agent will always receive the amount agreed upon in their listing contract which includes the Buyer’s agent’s commission.

Consequently, Listing Agents love it when a Buyer chooses not to be represented, because they effectively get two pay checks; their normal commission and the Cooperating Brokers commission, which a buyer gives to the listing agent by not being represented by an agent. That’s right Buyers who choose not to be represented by an agent doubled the listing agents pay check and make it easier for that agent to sell the house because the listing agent effectively controls both sides of the transaction.

In addition when a buyer tries to purchase a home without a Realtor they are setting themselves up to over pay and possibly end up with some unforeseen problem because the listing agent is not required to be the Buyers advocate. In other words “Buyers beware” also known as “Caveat Emptor”.

There is a lot involved in purchasing Real Estate more than meets the eye, cover yourself and hire a Realtor to represent you. It will pay you dividends in the end.
0 votes Thank Flag Link Tue Jul 30, 2013
DdPetit,

If your market is like ours here in Denver, this is absolutely a common, everyday, practice. Not only that, we often put in offers on day one and 5 or six or more offers can come in the same day. The banks usually contact all of the agents and have their buyers come back with a 'highest and best' offer. All of the offers are sent to the bank and the bank chooses the one they want to work with. Appart from this, there is a phenomena I call the 'cosmic convergence' when a listing sits there for seeks or months and all of sudden in one day two or three very similar offers come in. It is frustrating, but a more than common occurence that every experienced Realtor will verify. Hang in there. If you are dealing with a bank there are different rules (or no rules) when they respond to offers. If you are not patient or easily perturbed, foreclosures are not for you.

Robert McGuire ASR
Broker/Consultant
Your Castle Real Estate
Direct - 303-669-1246
http://about.me/robertmcguire33
0 votes Thank Flag Link Tue Jul 30, 2013
Depending on your price range, if you're not willing to be involved in a multiple offer situation, you may not be able to get a house in Arvada. Most homes in the lower price ranges are going for over asking price. I write monthly market reports documenting this fact, let me know if you want a link to read the most recent or just find me here on Trulia, where I post them.

As to why a house that was listed in May suddenly has multiple offers - it could be that the price was recently lowered. This is a very common scenario that you're describing.

Working with a knowledgeable local Realtor will be very helpful - and your agent is paid by the seller. Please call if you'd like more details.
0 votes Thank Flag Link Tue Jul 30, 2013
Purchasing a property especially if you are bidding from another part of the country can get frustrating quickly. Interview your team of professionals so you can trust in their current market knowledge and avoid waiting for a listing agent on the property to juggle your interests with the banks interests. Contact me directly if there's anything I can do to streamline this sometimes difficult and ever-changing market. You'll be glad you did.
0 votes Thank Flag Link Tue Jul 30, 2013
Do you have a Buyer's agent representing you? Multiple offers and highest and best have been very common in this market. You need to have a strategy in place and be ready to go! Have a Buyer's agent is vital, especially as they will represent you in the whole transaction, and they are FREE!!
0 votes Thank Flag Link Tue Jul 30, 2013
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