Sometimes the best approach is to be direct and play all your cards.
Jill, I have to tell you I'm more than a little uncomfortable with what has happened recently. These are my concerns. Trust is a big issue for me and from where I stand this is what II see. I'd like to buy this house but I'm not willing to get caught in the middle of some kind of game that is going on here.
Jill's response should clarify what your next move should be: either "all in" with your best offer, take it or leave it or walk away and look for another opportunity. There are plenty out there.
What do you think they are saying to the other two offers? Essentially, they have or so they are trying to make you think they have, several serious buyers and they are creating a behind the scene promotion to get the highest price for the property.
This is not a comfortable position to be in but this is the process when there are multiple offers. This is one of the reasons banks will post a rediculiously low proce on a property....they know it will get the real attention they are seeking.
Unfortunately, this is when the "Great Deal" becomes an "OK Deal"........Your task here is to determine when it is no longer a deal for you.
You could have used ANY Georgia licensed REALTOR/Broker to represent you and submit this offer to the listing Broker. The listing Broker has a legal responsibility to submit all offers to the Seller...in this case the bank/lender.
The listing Broker also has the responsibility to treat all offers "equally" in a multiple offer situation. In other words if they tell you and your agent that there are multiple offers and ask that you resubmit your highest and best offer within a certain timeframe then they have to give the exact same information to anyone else that has submitted an offer. We are in the middle of 3 multiple offer situations with Buyers that we represent right now. Here is how all three have gone:
1. We submitted an original offer.
2. We were notified IN WRITING that there were multiple offers received on the property and that we had until a certain time...usually 24 hours to notify the listing agent and either
A. Withdraw the offer---some Buyers don't want to get in a bidding war
B. Keep the original offer in play
C. Change the offer and resubmit
3. We changed the offer and resubmitted
4. We got a message from the listing agent that our new offer had been received in time and would be considered along with the rest.
5. Within a couple of days we were informed, again in writing from the listing agent, that they had chosen to counter one of the other offers and that we would be contacted again if those negotiations did not work out so we could have put our offer back in the mix if we wanted.
If your agent was made aware of multiple offers, and she truly was working with you under a signed Buyer Brokerage Agreement, then she definitely should have made you aware of the multiple offer situation and explained your options at that time.
There is a check box on our standard contracts that states the Selling Agent (Buyer's Agent) "is" or "is not" representing the Buyer. Do you see that anywhere on your contract? If your "Buyer's Agent" just filled in the blanks on the offer with answers you supplied her, and did not give you any advice or counsel about the choices you could make, then she may be acting as a transaction agent for you and not truly representing you. I would question the agent about this and have her make it clear if she is representing you as a client or just treating you as a customer. If you are not satisfied with her answer then you might ask to speak directly with the managing Broker of the firm and exlpain the situation to him/her.
When we work with a client or customer we either have a signed Exclusive Buyer Agency Agreement in order to fully represent them and their best interests or we have them sign a Customer Acknowledgement form that states that we are not representing the party and they are solely responsible for protecting their own interests. In that case our role is limited to performing limited ministerial acts for the party. Legally we have to have that signed Buyer Agency Agreement in order to represent you.
I hope this helps your situation. If you have further questions or just want to chat about this some more drop me an email at email@example.com. I promise I won't bombard you with spam. :)
This end of the biz is a snake pit and if agents get P'od, take a number. I've worked in the waters from the appraisal side - appraising these things with what they should be offered for and that's unpleasant to say the least. If dealt with them from the sales side - ONE agent that does this stuff is a stand up guy - Jason Harris of ReMax Greater Atlanta. I've dealt with dozens of others (incl all the big ones) and he's the only one with a sense of decency - or fair play. I've been approached to list these homes repeatedly - no thanks!
I don't know what to tell you on this one - I'd probably not look at buying the line you're being told and upping the offer. Bottom line is that these agents need to maximize every purchase because they probably have money invested, know they are working at reduced commissions (or worse - can have commissions changed at the last minute) and or need to show max spreads to keep/get more business.
I'm not soliciting - but why not get an appraisal to validate things? You can't let emotion get in the way of sound business - if something isn't kosher then I'd walk and chalk it up to experience. Hell, it might come back on the market and you can make another run - this time with a buyer's agent! I've appraised the same REO homes three and four times inside of a year or two!
Hang in there -
There's no point in rehashing the agency points, those made are on target - bottom line is that Jack & Jill are probably a "team", the team holds the listing and the seller is their client - you are their customer. You are not represented to the highest level and their loyalty has to be to the seller. They should "do no harm" - nothing illegal or unethical - but they will have the seller's best interests at heart.
The â€œissueâ€ with these distressed properties is that often itâ€™s like playing three card Monty. A home can site for a year, you call about it and suddenly there are multiple offers and your â€œhighest and bestâ€ is needed ASAP. The other game that is getting very popular is listing for significantly less than theyâ€™ll go for and the bidding war starts. Then the old standby â€“ itâ€™s under contractâ€¦it fell throughâ€¦under contractâ€¦.fell throughâ€¦all the while itâ€™s listed as active until the last possible second.
Dealing with these distressed homes and with most of the agents that handle them can make a buyers and agents nuts. So many are nonresponsive and adversarial that itâ€™s a wonder any homes sell. Many times they will look to represent both sides so that they can at least make a few bucks, often these agents have to front money for repairs, take deep discounted fees and hope to collect when the home sells. If they lose the listing with money due, they can have issues getting paid.
I know Iâ€™m off target with respect to your representation. All of the paperwork would have to be reviewed, but it appears that youâ€™re dealing with a designated agency situation. Youâ€™re probably painted into a corner at this point if you really want this house â€“ you likely canâ€™t introduce an outside buyerâ€™s agent at this point without Jill raising Cain. In short, it seems as if youâ€™re on her leash for this one but without reviewing everything thatâ€™s merely a very broad opinion.
If this doesnâ€™t work out and you go back into these â€œdistressedâ€ waters, bring an agent with a very strong BS meter because itâ€™s really getting ridiculous out here with this. I hope that our realtor association looks into the handling of these homes and how theyâ€™re advertised, marketed and sold â€“ I see things that I have to believe violate our conduct guidelines.
Good luck Fred â€“
Hank Miller, SRA, ABR
Associate Broker & Certified Appraiser
Prudential GA Realty
i think Jill is doing what she can for you. We do a lot of REOs and a lot of times when there are multiple offers, the bank comes back askiing the buyers to submit 'best and higest offer' the buyer is willing to put in rather than making multiple counter offers.
Banks do not like to waste time on processing those offers. A lot of times they run like an assembly line and yes, all they cared about is how much money they ended up getting and how fast.
An agent (any agent) can ask the listing agent if there are other offers and the listing agent can tell any buyer agent whether there are one, two, three or six (yes, that's realistic for REOs) . Many times, the listing agent will let others know how high or low (or even how much) the offers are, all depend on the specific situation and local R.E. law.
So, if you REALLY want this house, give her your highest and best offer. However, don't go so high that you will regret buyiing it if you do get the house.
Another of our three is the "listing it significantly below their target sales price to start a bidding war" with the hopes that in the excitement someone will pay even more than they usually would. I have no doubt that our offer here was one of at least 10 others, if not 20 others, submitted. They priced the home almost 33% below market and the property is move in ready with only small cosmetic fixes needed. We have also been notified on this one that the Buyer and Selling agent have not submitted the required addendums yet and if not received by Monday that our offer may be next in line for negotiation there.
Bottom line....keep in close contact with "your agent". If you are willing to move up in your offer price, still feel you are getting a good investment at the higher price and REALLY want that home, then let the agent know and make sure you she is keeping you in the game.
Contracts do fall out....especially those involving financing in this questionable credit market....don't count yourself out until you see that property is sold. Best of Luck.
As far as the ball being the bank's court -- a bank can take weeks or even months to get back to you. Once they say "submit your highest and best offer" they generally mean just that. They get everyone to tell them how high they are willing to go and eventually they get back to whoever they decide has the winning offer. Short sales and foreclosures are not for the uninitiated or the faint of heart.
If this opportunity doesn't go your way, I'd advise you to research the process in the future and to hire your own dedicated buyer's agent -- one with a lot of experience in short sales and REOs -- who can guide you through the process.
Best of luck. :)
This is another great example of why you should have your very own agent.
Not only is this a conflct of interest, but it may be a violation of the law. You said Jill assigned herself as the buyers(your) agent. How did she do this? Did you sign a Buyer Brokerage Agreement? On the contract is anything filled out stating Dual or Designated Agency? If she has been "designated" to represent you then she can have knowledge from Jack that other offers exist, but it is unethical for Jack to disclose the amounts of the other offers to Jill as she is representing you. Jill now has a fiduciary responsibility to you. If she is the buyers agent for the other 2 supposed buyers, then she must now disclose a dual agency situation where she represents the interests of multiple parties with offers on the same property.
Now that you are in this situation, just follow your own instincts as to how much you are willing to pay. You may want to consider cost of repairs + acquisition cost = investment vs area comps before you jump in deeper with your heart.
What else can you do? If you are not happy with Jill's performance and wish to explore the supposed conflict further, then I suggest contacting Jill's broker. That is the qualifying or managing broker of the company Jill works under.
Good luck to you!
As the buyer you are at an informational disadvantage. You need someone who can give you meaningful information and advice you can rely upon. An agent acting alone can't do this. I would suggest you get someone on your side.
This does happen alot with Bank owned properties. There probably is some offers on the property too but the listing agent is not allowed to display them to the buyer agent. If I were you I would put what you can afford as an offer. If you can go alittle higher than and still able to afford your payments than try it. You will need to wait until the Bank decides which offer to pick if the listing agent presents. Sometimes agents will tell the other agent if it's too low and don't waste time sending becuase they have other offers higher. Banks are going to try get as much as they can for the property. But if you feel it's too much then stick to what you have or look for something in meantime while you wait.
Century21 Maria Realty
If I am overlooking key facts in this situation, please let me know.
You all have provided outstanding advice and I'll certainly remember your names for future reference. You've given me a lot to chew over before I made my next move. Thanks again.
Hank, are you clairvoyant? This is exactly my situation. The home I want to buy is a dozen houses away from mine on a different street. I pass by at least twice a day, on my way to and from work. It sat for at least a year (maybe more) before the owner took the For Sale sign down. Now that itâ€™s bank owned the asking price has decreased 85%. I live in the neighborhood and I know the market here. None of the homes are moving yet Jill expects me to believe that there are suddenly multiple offers on this one?
Is it reasonable for her to ask me to increase my offer when I haven't even heard back from the bank yet? If this were a game of tennis the ball would be in the bank's court now. It's not my turn to make a move or is it? Given my desire to get this house I would consider upping my cash offer but I get the feeling that Iâ€™m being hosed and I donâ€™t like it.
I am glad you know that it is designated agency. In most cases, I think that's an OK way to do business... so, unless you have reason not to, trust your agent and use her counsel.
Joshua, you say this was a poor decision on my part but how else could I have gotten my offer to the bank except by going through Jill? By the way, Jack and Jill have different last names so it's not clear whether they are married.
Lynn, that's just the thing. I would assume that if Jill was REALLY working in my best interest she would have contacted me and let me know that there were higher offers on the table. Even if she couldn't tell me exact figures, if she's working to help me get this house she could have clued me in. I have no problem with multiple offers; the problem is that my agent appears to have divided loyalties. I haven't yet received a rejection or counteroffer yet but my agent is telling me to offer more money. It just doesn't smell right to me.
Most of the foreclosure agents I know don't have much motivation to mess around with this kind of thing, just too much at stake.
I say make your highest and best offer or walk away and get a REAL professional.