George

"Obviously you don't know what you're talking about , Lenin." submitted by JR

“Yes, I am lost. Please explain to me.” response by Lenin

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That pretty much sums it up completely. Just for the sake of helping out Lenin, who OBVIOUSLY doesn’t know what he is talking about, let’s look at few issues:

1. Procuring cause.

If the home has been shown to a specific buyer by a realtor or “buyer’s agent,” other realtors who adhere to the professional code of ethics should not write an offer for that buyer on the same property. To do so is a breech of ethics. This especially applies to the listing agent. As an example, this is why new home builders are adamant that a buyer’s realtor accompany them on their first visit. Your little idea of having the buyer return to write an offer directly with the listing agent without their buyer agent is just plain silly. And a violation of the realtor's code of ethics.

2. Dual Agency

If an offer is directly submitted by a buyer to a seller whose home is listed by a realtor, the contract specifies that the listing broker becomes the agent for the buyer and thus becomes a dual agent. This is also specified in the fine print in the agency disclosure that must, by law, be part of any offer with realtors involved. Whether the buyer likes it or not, they are now FULLY and legally represented by a realtor. This realtor is now FULLY responsible for the buyer AND has a fiduciary responsibility to fully represent the buyer. If, in this arrangement, the buyer tries to negotiate on their own, they actually breech the fiduciary responsibility of the realtor involved in the transaction and open that realtor up for potential legal action. Seasoned realtors WILL NOT accept the legal and fiduciary responsibilities of both a buyer AND seller in the same transaction (dual agency) without compensation that is commensurate to the risks AND extra costs involved (such as additional E&O insurance).

Lastly, because of the potential legal and conflict of interest issues, some asset managers (hired by banks to handle their REOs) instruct those realtors listing their REOs to represent the sellers only.

The fact that “many” of your friends have managed to negotiate arrangements like this with listing agents might mean a couple of things: (a) the listing agent could a “green agent” and unaware of the legal implications of such an arrangement OR (b) may be desperate for income and looking for a quick buck. In either case, I would NEVER want that type of agent representing me, ESPECIALLY IF I WERE THE SELLER. I need representation I can count on for any issues that may appear down the road. Just like I would NEVER go to a cut-rate dentist. I only get one set of teeth. And buying a house is the largest investment most people ever make. Why would you risk a potential law suit and inadequate representation to save a bit of money? VERY, VERY foolish.

3. Self Appointed Experts

I’m sick and tired of self-aggrandizing “experts” who hide behind pseudonyms and use this format to fire off banalities like they actually know what they are talking about. All of the Realtors who contribute here identify themselves clearly and are responsible for what they say. The two issues above are merely the tip of the iceberg of issues that are prevalent when trying to do an end run around professional realtors. Truth is, there may be a few competent individuals out there who do not need a realtor. I’ve met a few. And I am sure there are a few out there who have also pulled their own teeth and removed their own appendix. These types of folks are few and far between. Most people need professional representation. I am a professional in real estate law, and yet, for all of my personal real estate transactions I choose to use a realtor BECAUSE of the protection and legal covering they offer in any given real estate transaction. There is an old saying out there that applies to all of this: “You don’t want to be penny wise and end up being pound foolish.” - Sat Jul 26 2008, 18:48