Received an offer from a Realtor and it's written in the name of a business who buys and flips them. Doesn't disclose that this is her biz. Ethical?

Asked by Charles Coachman, SRES, San Jose, CA Sat May 3, 2014

This Realtor says her client needs this and that, even though in reality she and her husband are the clients. Maybe it's just a grey area, but not to disclose that you are buying for your families business just seems to be unethical, what happened to disclose, disclose, disclose? Or does that only pertain to sellers?

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Dan Tabit, Agent, Issaquah, WA
Sat May 3, 2014
Charles,
First, are they a Realtor or just an agent? Not all agents are Realtors and if they are not, the Realtor Code of Ethics wouldn't apply.
Next, regardless if they are not disclosing that they are both an agent and a principle in the transaction, this may well violate rules in your MLS.
You've discovered this, so the fact that they didn't disclose tells you something of their business practices, so be careful as always and verify everything in writing.
Finally as Phil says, if the offer is strong and can close, do what's best for your client as always. If there are violations to the rules or code of ethics, you may want to wait until the deal closes to report them, that way your clients needs are protected and you can still help improve the profession.
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Phil Rotondo, Agent, Melbourne, FL
Sat May 3, 2014
If it a good offer and it closes, I wouldn't sweat it.
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Annette Law…, Agent, Palm Harbor, FL
Sat May 3, 2014
If it is factual that she is an owner of the business and this house is purchased for/through this business, and she is a REALTOR, this would be a violation of disclosure requirements. That should raise a few red flags and portend future deception.

Let's remove this agent from the picture.

If you received a purchase offer from SJ Advantage Investments LLC presented by another agent, what protocol would you observe?

What's the real issue, someone not playing by the rules or the requirement to advise your seller this can turn into a real trap unless you apply unconventional (not by the rules) requirements of the buyer?

Seems as though this agent realized that instead of referring good deals to wanna be investors, she is buying them directly. You should be doing the same thing. But, in a similar situation, I would be happy to say, "Charles, I am the one buying this house. Let's make it happen."

Then you'll ask, 'What's your funding source?" The next month you'll be buying too.

Meanwhile the graduates of the 'Grazzosi' get rich in real estate seminar will be posting messages, "Looking for aggressive, hard working agent who is willing to write cash purchase offers and who is investor friendly." And you'll be asking, "Why aren't these agents buying this real estate themselves?" ...and the world goes round and round.
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