Home Buying in Jacksonville>Question Details

Isham.nancy, Home Buyer in Fernandina Beach, FL

Is this illegal? I know it is not ehtical.

Asked by Isham.nancy, Fernandina Beach, FL Wed Sep 18, 2013

Hi. I made an offer on a property and gave an expiration time of 8 p.m. on the offer. My agent and the listing agent work for the same company. I was asked in the afternoon to extend my offer because one spouse was on a trip and wouldn't be home until later. In good faith I extended the offer expiration until 4 p.m the next day. At 9 a.m. the next morning I was told that another offer was made on the property and that I should submit my best offer later today. This house has been on the market for 9 months. I believe I was asked to extend my offer to allow enough time to get a competing offer in since all of this was happening in one company. Is this legal?

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Alan May’s answer
Sorry, based on the information that you've given us... I can't say that it was either illegal NOR unethical.

I know it seems a little suspect, based on the timing... but we see this sort of thing happen all of the time. A confluence of items came together... probably the same items that caused you to decide to make an offer... (maybe lower interest rates, maybe more confidence in the market, or a recent price reduction... who knows?)... and we find ourselves in multiple offers.

What you're suggesting is that the agent/agency may have known that another offer was going to come in the next morning... or perhaps that they were using your offer to "shop" for another offer. While it's possible, I suppose, it's unlikely.

The agents/agency if they did as you suspect... just made their own jobs far more complicated... and for a very nominal gain in the agents pocket. Not much motivation there, for a breach of ethics.
3 votes Thank Flag Link Wed Sep 18, 2013
Alan May, Real Estate Pro in Evanston, IL
Regardless of if you extended your offer or not, the other offer would have likely gotten considered any way you look at it.

Your expiration deadline was 8PM, and you were notified of the other offer at 9AM the following day. It is unlikely that both you and the seller, would have been able to execute a contract and get the earnest money delivered after 8PM but before 9AM the following day. Also, 9AM is simply when you were notified of the multiple offer situation, not necessarily when it was received and considered by the seller.

Buyers understandably don't like be "jerked around" and having their offers "held". The reality is that you can communicate all the "deadlines" and other stipulations that you perceive to protect you to the seller, however they can always simply find a "legal" way to stall you if they really put their mind to it.

You always have the option of simply walking away - the choice is yours whether or not to play the game. I don't know the specifics of the situation, so I can't definitively say if it was ethical or not at the end of the day. I will also add - don't take the process personally. You can only control what you can control - and you have always have the option to rescind your offer and move on to another property.
2 votes Thank Flag Link Wed Sep 18, 2013
Yes it is. And it happens often. Good luck on moving forward.
1 vote Thank Flag Link Tue Sep 24, 2013
This is a negotiating tactic commonly used, but not illegal. The agent is doing their job in trying to get their client (seller) the highest offer. Your agent has a slight conflict of interest as he/she works for the same broker.

Judgment call on your part.

I remind my borrowers (that I pre-qualified) to base your decisions on how aggressive you want to be. In other words, if you really like this house, make your best aggressive offer. If you can take it or leave it, ride it out with your initial offer and see what happens.

I am a licensed Direct Lender in Florida quoting "raw" interest rates to consumers. Call me to find out what my rate is.

Ray Stevens
239 481-9514
1 vote Thank Flag Link Wed Sep 18, 2013
You may want to read my reply....this type of situattion happen OFTEN. Most likely, there is nothing unethical here...it just "happens". You just NEVER know what will happen in real estate...real estate agents want the best for their customers...but...many things cannot be controlled...timing is everything.....in this case....it just did not work well for this buyer...there IS something better out there.....sounds trite...but it is TRUE.
Flag Wed Sep 18, 2013
I know it's frustrating but multiple offers happen a lot. I just had two customer this month that found their selves in a similar situation, but things are not always as they may appear to us at 1st sight. I even had it happen to myself in Jan! I couldn't believe no activity & than when I put in an offer someone else did also....but I just gave my personal highest & best offer. I know I probably paid more than I would have if the property hadn't have gone to multiple offers, but I'm so glad that the seller gave me an opportunity to up my offer instead of just accepting the other offer. Thanks for your question.
Brenda Waters, Realtor
1 vote Thank Flag Link Wed Sep 18, 2013
Until you or your agent have in your hands a signed contract, the seller can change their mind, no matter if they have already given you a verbal acceptance. Is it good business practice or good karma? Probably not. That's why business and emotions should be kept separate. It has happened to all of us in the business. Was this answer helpful? If so please click on "best answer" or on the "green thumbs up".

Tony Vega
Antonelli Realty
1 vote Thank Flag Link Wed Sep 18, 2013
Yes, it's legal. And yes, you got shafted. It has happened to all of us. The listing agent "shopped" your offer and pulled another one out of the woodwork. Your agent should have been wiser or at least probed a little deeper as to why they needed an extension. People on trips have phones.

Sorry for you luck.
0 votes Thank Flag Link Tue Sep 24, 2013
Unfortunately for you....this is legal.....and...it is not considered unethical. So many things can happen in real estate transactions. Many times the sellers are not available due to work schedules, perhaps their cell phone is on the blink, maybe their child is ill, maybe they are out of town. It "seems" suspicious to you....but, most likely...it is the truth. A home can be on the market for a day, a month, or a year...suddenly EVERONE wants the same home....it happens way too often. Legally...ALL offers MUST be presented to the sellers....I am so sorry you were not on the winning side of this transaction. Your agent IS working to help you accomplish your goal....I have found....over the years.....that there is ALWAYS a better home out there for the buyer...just believe that, and you WILL see....it has been true for our buyers over the last 23 years. Good luck in your future transaction....I know your agent will do everything they can do to make it work!

Donna Delegal
"The Real Estate Lady"
Oceanside Real Estate
(904) 732-PACK 732-7225
0 votes Thank Flag Link Wed Sep 18, 2013
Have you spoken with your agent regarding your feelings on this? Having a frank discussion with him, or her regarding this matter may bring some clarity and understanding that you've not considered as of yet.

That being said; It is customary to give a 24hour time of elapse on an offer. While your question is not crystal clear on this, it seems as if the time of elapse on your offer was for 8pm the same day your offer was written. If that is the case it sounds as if your agent was simply trying to be fair and give the sellers reasonable time to consider your offer. As to the second offer; housing inventories are tight, and while we may not be in a classic sellers market yet, competition for homes is high right now especially for quality listings. As another responded the seller would likely have seen the other offer regardless of your time of elapse.

I hope that helps.

Hang in there!
0 votes Thank Flag Link Wed Sep 18, 2013
There are a couple of things that are not clear here. You said "all of this was happening in one company" . Did you mean that the listing agent and selling (buyers) agent are both in the same company? Was the other offer from another agent in the same company or the listing agent? Was the other agent from a different company?

The only one of the above situations that would raise an eyebrow for me is if the listing agent had brought the other offer. If that is the case then the listing agent should have disclosed that to your agent. Even so, it would not be illegal or unethical as long as the details of your offer were not disclosed to the other party thereby giving the other buyer an advantage. The listing agent will generally welcome multiple offers since they often get the seller more money for their home. The buyers (your) agent, whether they are from the same company as the listing agent or not, most likely does not want to see multiple offers since there is a risk that the other may be the one accepted.

Neither buyer should be made aware of the other buyers offer. This keeps both buyers guessing what the other buyer may have offered. It is that uncertainty that causes a buyer to offer more than they may have otherwise. Your offer may already be better than the other offer but you just don't know. If you really want this home I would recommend making the best offer you feel comfortable making. If you get the home then you should be happy because you paid what the home was worth to you. If you don't then the other buyer wanted the home more than you did and paid more than you think it's worth.
0 votes Thank Flag Link Wed Sep 18, 2013
This happens everyday and is perfectly legal, be fortunate that you where able to compete by them requesting your highest and best offer. In a sellers market which we are in now in most part of NE Florida be prepared for this to happen on any quality listing. Good Luck
0 votes Thank Flag Link Wed Sep 18, 2013
All real estate agents take the same test and are licensed by the state of Florida. Those agents that choose to be a part of their local realtor association board take an additional course of 14 hours that includes core law and ethics. Once done they sign an affidavit to abide by these rules and can be brought before their board if not.

Also a seller has the right to choose the offer. Decline the offer. Counter the offer. Or just plain not respond when requested. It is up to the Buyer to walk, counter or wait.

I am sorry you went through that ordeal, but I have seen that happen as well, even with my own listings. There are a few things you can do. One is to accept that this deal was not for you and move on. Two, ask your agent to see the other offer that beat you out. Three, speak with the broker of the office. Four, and this is only if you really feel you were not treated ethically, make sure, because this is the realtor's livelihood, how they feed their family, call the local realtor association board and speak with them. They will give you unbiased answers.

Hope it doesn't go that far, best of luck!
0 votes Thank Flag Link Wed Sep 18, 2013
Sounds like it could be a little fishy or perhaps not. RE agents are required to submitt any and all offers in a timely manner. Was this due to a signature that was required on the offer? If so, the offer was not written but verbal without both signatures.

If you expect that you were sandbagged, you could always file a complaint with the Department of Business and Professional Regulation, Division of Real Estate.

Wayne Jones
Watson Realty Corp.
0 votes Thank Flag Link Wed Sep 18, 2013
If the property had just come on the market then I would agree with you but if it has been sitting there for 9 months then any kind of contract shopping would have happened long ago. I doubt seriously if there was a buyer that has been sitting on the fence for 9 months. 1 day is not going to make anything happen that would not have happened before. I remember when I sold real estate and would show a property that was pretty well shop worn and the people that loved the house and it was perfect for them would say :"It's been sitting there on the market for 6 months so it will still be there in a few days while we look at a few more". I would use scenarios like the store that is vacant of customers when you go in and when you get to the register there is a long line of people, but to no avail is dismissed as some sort of sales tactic and sure enough a few days later the place would be under contract. The bottom line is when you find a place that you like then it is time to buy. Any hesitation usually results in disappointment.

I know whenever I make an offer on a property it is my best offer. If you want to negotiate a deal then you stand the chance of losing. Just depends on how bad you want the place to pay more than what you want to spend, I suppose.
0 votes Thank Flag Link Wed Sep 18, 2013
We all have stories to tell but unfortunately it is what it is and we move on. I really hope you find something much better so you can say things worked out for the best. Please contact me if you need help locating a property and walking the transaction to a smooth close.

Have a Great Day

John Breen
Realtor, Magnolia Properties
904 349 0082
0 votes Thank Flag Link Wed Sep 18, 2013
Alan is absolutely correct - this does happen all the time. Just had it happen to a buyer of mine last week.
0 votes Thank Flag Link Wed Sep 18, 2013
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