Home Buying in San Jose>Question Details

Alex, Home Buyer in San Jose, CA

I asked an agent to show me the house that I liked twice. but because the price was too high therefore I

Asked by Alex, San Jose, CA Thu Feb 28, 2008

postpond the purchase plan. One month an half later, the price went down, this time i really wanted to buy that the same house however with a difference agent. By the way, during that 1 1/2 month the first agent called me so many time like a collection agent! I always said no to him. Now my current agent got an arbitration complaint from the 1st agent. He stated that he was the procuring cause. Am I at fault or liable about this? I though I had the right to choose my agent. And What can i do do help my current agent who helped me buying this home. Thank you for your advices

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Dear Alex,
Because, as you say you had no verbal or written agreement to use the services of this agent, you have no obligation to him. Were he a true professional, he would wish you luck and move on. His lack of ability to recognize early on you were not interested and gracefully touch bases with you on a less irratating schedule, earning your trust and respect would have served him much better and potentially captured your business. Too many agents in their zeal to simply earn as much as they can, forget we are a service industry, and instead of educating and empowering you, it seems this mans only interest was attempting to brow beat you into submission for his own monetary gain. You are the consumer, find a solid agent who you can "connect" with and who has a reputation distinguished by a portfolio of testimonial letters from past clients and stick with him/her. Don't be afraid to fire your agent if he/she is not doing what you want so long as it's ethical. Caveat Emtpor!
1 vote Thank Flag Link Thu Feb 28, 2008
Realtors are discussing procuring cause as it applies to real estate, because this is a real estate thread. I don't see anyone here stating that procuring cause doesn't exist outside of the industry.

And while I don't agree with Dorene's post either, I found it arrogant and condescending, but I don't agree that she's grossly misinforming the public, nor that she should be removed, nor suspend her broker's license.

I didn't see any real pearls of wisdom in your post either, and yet you have every right to post your vitriolic opinion. That's the nature of a public website.
3 votes Thank Flag Link Sun Mar 9, 2008
Alan May, Real Estate Pro in 60201
This blog is good for all other buyers out there to read.

When you make contact with an agent and they start showing you property, calling, email, etc... they believe they are working for you as their agent - signed agreement or not. If this agent isn't working as you like - tell them. And follow up in an email or letter. If the time comes that you no longer wish them to be your agent - tell them in writing (1) I no longer desire their services (2) please respect my wishes by not calliing, emailing, etc. and (3) don't accept their services. When you do accept an agent to work for you a good follow up would be to acknowledge that agent in writing - possibly with a buyer broker agreement or another form of understanding, and notify the former agent.

Agents do not want to work for free and honestly do not want to be a pest.

Alex, I wish you the best.
Web Reference: http://www.terrivellios.com
2 votes Thank Flag Link Wed Mar 5, 2008

You need to speak with a real estate attorney. Questions he/she will ask are: Did you sign an agency disclosure (who with/when/where)? Did you sign a buyer/broker agreement (who with/when/where)? If you did not sign a buyer broker agreement but did sign an agency agreement...what happened next (exact sequence of events)? Did either the first agent or second agent offer any incentives to you in order to get your business (what/when)? What specifically did the first agent do in the house hunt (sequence of events, show property, help with disclosure info, write any contracts on any other properties, write a contract on this property that wasn't submitted etc.)? When and how did you "fire" the first agent? How did you come to meet the second agent? What did the second agent do in the house hunt (sequence of events, show this property, help with disclosure info, write a contract on this house or any other)? etc.
You will be asked a series of questions to see if the first agent (even if you didn't have a written buyer's broker agreement) was the main factor through a series of events that led to you buying the property. If there was a break in the events, the first agent didn't write a contract on it etc. these are reasons that the second agent should be procurring cause. With that being said, seek legal advice. We are real estate agents, who through experience understand the processes, but we don't know for fact the legalities or remedies in your specific case. GOdd luck and it would be nice when you case is resolved that you finish the thread.
1 vote Thank Flag Link Fri Mar 14, 2008
uh oh... here comes some more "out of state" advice... brace yourself!

Without a signed EBA his case is far weaker. I'm glad that you did inform your current agent, and am surprised that he didn't try to work out some arrangement with the first agent, if only to avoid the exact situation you've found yourself in today.

If I'd have been your current agent... I would have notified agent #1 that you were now working with me, and that if we find a property to buy (regardless of which property) that I'd be willing to pay him a small referral fee (maybe 10%) for his trouble. He would probably have accepted that, most likely figuring that you're not going to purchase a home that he already showed you. I would have gotten his "agreement" in writing, and then you wouldn't be fighting this situation today.

I doubt that you'll be called to attend the arbitration, but your current agent might ask you to write an affidavit, at some point, to support him... but he'll let you know if/when he needs it. Meanwhile, you might want to let him know that you're willing to write one, if he needs it.

Good luck!
1 vote Thank Flag Link Sat Mar 1, 2008
Alan May, Real Estate Pro in 60201
Alex - I'm so sorry you've received non-state and/or non-realtor information. Guessing doesn't work when it comes to the law. I highly recommend you take my advice. Good luck to you
1 vote Thank Flag Link Fri Feb 29, 2008
Really, the mistake that you made, Alex, was in not telling your "new agent" about the situation with the old agent. Had he known in advance about the situation, he probably could have notified the old agent that you were working with someone else, and perhaps worked out some "referral fee" or "showing fee" that might have satisfied the old agent.

I'm not sure how California law will treat the situation, but I'd presume the first agent will be entitled to some portion of the commission, as he DID show you the home (twice) that you ended up purchasing. And he did attempt to stay in touch with you. Procuring cause is much more than merely the "showing" of the property... but follow-up is a part of cause too.... and it sounds like he tried.

You are not liable, if you didn't sign an exclusive buyer's agreement, so no money will come from your pocket. But your current agent will likely have to share a portion of his commission.
1 vote Thank Flag Link Fri Feb 29, 2008
Alan May, Real Estate Pro in 60201
Alex - I would ask the agent's broker (not the agent) to forward a copy of the buyers agency agreement signed by you. Include two items in the letter 1) timeframe -Give him 10 days to supply this document in the letter 2) If you do not supply this document in the next 10 days I will file a complaint with the department of real estate. Then you need to send it certified mail. The new agents broker should be involved with this as well. You may have noticed a reoccurring theme here...the brokers need to be involved. Agents are only employees of the broker. No broker wants the eyeballs of the DRE on them. I'm a broker, I know. As straight forward I keep things every once in a while one of my agents does something where I have to say, "no you can't do this or that". I bet the agents broker knows nothing of this. Hope this helps. The fact that you feel you need to post here shows you are concerned with your currents agents ability to know how to handle the situation. Get this agents broker involved!
1 vote Thank Flag Link Fri Feb 29, 2008
No verbal or written agreement at all but he still claim that he had agreement with me but I am sure that I did not promise or sign any paper works Just talked only. Those phone calls from him was really irritated, one time I had to beg him " don't call me , if I need you I will call you, please! " . The problem was I did not have the gut to tell him straight that i did not need his service even later when I got my agent because I though that he was not my agent so I had no obligation to tell him what I was doing. I just gave him all kind of reasons not to talk him, I was somewhat afraid of his phone calls. that was it. Now I am sitting and thinking what have I done wrong? Alex
1 vote Thank Flag Link Thu Feb 28, 2008
It depends on whether you signed a Buyer Agreement with the first agent. Never sign anything that you don't understand and has not been thoroughly explained to you. Good luck and I hope everything turns out ok for you so you can enjoy your new home. Housewarming Congrats!
0 votes Thank Flag Link Thu Mar 13, 2008
Hi ALex,

I read through all the answers and I would like to confirm with you one more time. You have no obligation to the first agent at all. And you can tell him to hit the road. I hope his name is JACK so you can sing that tune to his message. Tell him not to bother you. That was his fault did not have enough confidence in himself to ask you to sign the agreement. The second agent need not to do anything. None of you or your agent has fault or is reliable. Dorene was right and so were the others except the Wanderer. I don't know if it was he or she because this person is mysterious and I don't know if he knows anything about our California Real Estate Laws. I don't even know if he is really a licensed agent or not so just be careful when you take his advice. If you need legal advice talk to your attorney. Dorene is the broker and she knows what she is talking about. I agree with her along with Rebecca and Teri. Julie made a good point since she only spoke what she knew of in her own state of New York. Good luck with your home hunting process.
0 votes Thank Flag Link Mon Mar 10, 2008
I see realtors here discuss procuring cause as if this legal concept only applies to real estate deal. Procuring cause is a legal principle and is not limited to any specific industry. I wonder how Dorene got a broker license, because she is grossly misinforming the public. She should be removed from this chat line, and her her broker license should be suspended until she becomes better educated. It is people like this who give all of you a bad name. And, just how does one like her manage to get a broker license?
0 votes Thank Flag Link Sun Mar 9, 2008
Just FYI, there are a number of scams ongoing regarding buyer representation. I was scanning craigslist for properties and in an email when I asked for an address to an REO- the reply included a radio button "I accept" which was basically an agreement to use THIS AGENT as a buyers agent for THIS PROPERTY. My advice is don't sign anything and tell this RE agent to bugger off. Do your own research, it really isnt' that hard, and use trulia to search for the RE you want and when you are ready to make an offer, use Redfin or one of the discount sties.
0 votes Thank Flag Link Fri Mar 7, 2008
First, thank you for all the answers and advices , I really appreciate it and I feel much better now. Back to my story, I did notify to my current agent when I first met her about the first agent and and she asked me if I signed Exclusive buyer agreement I said no, she replied then there was nothing to worry about. However the first agent stated that he did not need the buyer agreement because he had many factors to show that he was the procuring cause. I remmenber on the second time touring the house, I asked him " what is the incentive if I chose you as my agent" He said " it is not legal to say or promise anything that you know!" but about 3 weeks later he called me and said that if I chose him as my agent he would gave me one percent of commission. His objective was to make me submit offer by chasing me with his phone calls while at that time I had not got pre-approval loan, not sure how much money I would qualify for the loan emotionally not ready and his lack of knowledge about mortgage loan is another turn off. So that was the reasons I looked for a different agent. Now I am waiting for the arbitration day, I don't know if I have to testify /testimony at the hearing. Again thank you for answers and advices. Alex
0 votes Thank Flag Link Fri Feb 29, 2008

In NYS if you signed nothing you would not be held liable for any of the agent's commission. Your first agent and your second agent would go before a grievance committee of their peers. The committee would then decide who was ultimately the procuring cause of the sale. Whoever made the best case would win because they do not like to split the commissions as it devalues the entire arbitration process. Maybe you can provide some type of written statement for your second agent stating you enlisted his help after having to tell the other agent to stop calling you. I am not sure if it will help or not. I can only speak from experience in my own state. This is why it is important for everyone involved in a real estate transaction to be entirely honest.

Good Luck!
Web Reference: http://www.wnyhomevoice.com
0 votes Thank Flag Link Fri Feb 29, 2008
I am not a realtor, but I work in sales. Commissioned salespeople depend upon the integrity of the customers. The first realtor should get paid. If the second realtor was duped by you, you should pay him. If the second realtor knew he was stealing someone else's sale, tough luck.
0 votes Thank Flag Link Fri Feb 29, 2008
Alex, as others have said..if you signed a "Buyer/Broker" form then you would personally owe your first agent 100% of the commission paid for the Selling agent. If you did not then your second agent would owe the first the commission. Basically he will have ended up working for free for you. Since you clearly admit the first agent found you the property and showed it to you twice..and you ended up purchasing it within a reasonable time frame the first agent is due the commission.

Many times in situations like this the agents end up working out a deal where the agents split the commission, but only if they both agree. Hopefully this was not a situation where you got any commission back from the agent (as from discount Brokers) because that amount would still need to be paid by the second agent to the first.
0 votes Thank Flag Link Fri Feb 29, 2008
If you signed a buyer's agency agreement with the 1st agent you may be liable to him. If you are confident that you did not I would advise that you write a letter on behalf of your current agent and explain why you chose to have the second agent represent you.
0 votes Thank Flag Link Thu Feb 28, 2008
By the way, He asks for $20,000 commission. The listing agent was also on the arbitration complaint
0 votes Thank Flag Link Thu Feb 28, 2008
Alex, Did you sign a buyer's representation agreement with your first agent?
0 votes Thank Flag Link Thu Feb 28, 2008
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