1. an agent of the seller must present all offers to the seller (time is of the essence)
exceptions: 1.a if the seller has instructed his agent to not present certain offers.
1.b if the offer is patently frivoulous, and would be considered by a reasonalbe person to be a frivolous offer. (such as the offer is $1,000 for an $81,000 listing. )
1. c if the offer is illegal (such as a fraudulent offer of one that violates fair housing laws.
2. An agent of the buyer may release the buyer from buyer agency representation if the buyer and agent cannot agree on offering strategy.
So, in some cases the agent, has the obligation to refuse to present, some cases the agent has the right to refuse to present, in some cases the agent must present the offer.
As far as fiduciary duty is concerned. Here is a prime example of why a highly ethical buyers agent in the full exercise of fiduciary duty may want to discourage you from offering $80K below lisitng price.
MY Example: Great buyers agent finds a needle in a haystack for his bargain hunting buyer. -
I have found my buyer a million dollar property that is listed by a desparate seller seeking a quick sale for only $800,000. - I notify my buyer of this amazing deal a 20% discount from CURRENT market value (not some old inflated list price form 2005 or 2006 but a 20% discount from todays depressed market value)
It is just what he has been looking for. I've invested dozens of hours with this client already
We go view the property, even though it is new on the market, dozens of prospective competing buyers are milling about. The kitchen counter has a hundred showing cards. I call the list agent to get escrow and offer delivery instructions. List agent tells me he already has two offers in hand and is expecting three more besides mine and will meet with the seller that evening.
I explain to my buyer that he has competition and should come in with a strong offer. My buyer steadfastly sticks to his "Always offer 10% below asking price, no matter what other information is available strategy"
Though I have 30 years of experience, my buyer assures me that he has a "good feeling" that his offer will be accepted. He has read some books.
If I meekly accept my clients naive arrogance and submit his frivoulous offer he will definitely lose out on his dream home property that could have also been worth 200,000 fiduciary duty dollars to him.
If I am honorable and firm enough to truly perfor my fiduciary duty, I will try to persuade him to make the offer that is actually in his own best interest which is the full price offer that saves him 200K instead of the frivolous offer which gets him nothing but the thrill of having written an offer that can not and will not succeed. AS I SAiD - This is just an example... In no way am I suggesting that Marissa or her stuation is anything like my hypothetical (I wish it was hypothetical for me) buyer. I am just pointing out one possible alternative explanation that Ken, Ruth, Gary, and J R hadn't thought of.
Century 21 Infinity
"Hi Ruth. I think you totally misunderstood what I said in my answer to the question regarding refusing to present an offer $80,.000 below asking price. I did not say that the listing agent would tell the buyer's agent what the limit was. I was merely saying that the listing agent can decide not to present the offer if he has written instructions from the seller. I agree with you that I would not disclose the cut off. Please don't forget that the seller is in charge and if the seller instructed the agent in writing not to bother him/her with offers below a certain price, I would be well advised to honor that request. I would explain to the seller before hand that it's not a good idea to give me that instruction, but if the seller insists, I am bound by that and rejecting the offer would be within my authorities as the agent as I would only execute the express written instructions. I personally have never had this happen, but I wanted to point out that a listing agent cannot refuse to present an offer unless the written instructions were given. I hope that clarifies my answer.
Frankly, I am not quite sure how the this earlier question relates to this question. What does it have to do with the perception of real estate agents as used car salespersons. Actually, I have never been compared to a used car salesperson. So I am not sure that the perception is even valid."
Ute said, "unless the seller instructed the agent in writing not present any offers that are lower than a certain price."
Lisa said, "There may have been a similar offer that was presented before and refused. The listing agent may know that the seller is unwilling to go below a certain dollar amount."
I AM OUTRAGED!!! WHAT HAPPENED TO CONFIDENTIALITY? Even if the seller put it in writing not to present an offer under a certain amount, the agent needs to accept that offer and deal with it as a negotiation to get a higher offer without disclosing their instructions. Why would a buyer's agent know the amount of a refused offer? What if the seller had something happen or more time has gone by since the refused offer. This is why agents get a "used car salesman" reputation. Because you are going to the back office to "talk with the manager" and come back and say, "Oh, you'll have to offer more."
We had this question not to long ago and it amazes me how many agents are discouraging offers.
If you are an investor and looking to do something in Oakland, please share some comments and ideas. You could get a hold of my at firstname.lastname@example.org.
What I said was the Listing Broker does not have to write the contract if they do not want to. They have a right as a professional to let the Buyer know that they are uncomfortable being the dual agent and can not provide a Fiduciary in that case to the buyer.
We get a very high percentage of buyers that go the the listing agent direct and demand that this agent make a low offer for them. Most of them also demand that the listing broker cut half the fee as well.
This is not legal in Oregon as we do not allow rebating or fee to be negotiated by the Buyer unless they are paying the fee under a buyer broker. Let's say that a Home is $500,000. I listed it and the home comps out at $490K and we leave a little for wiggle room. The hoem goes up on the mls.
A buyer sees this home online and drives by and than calls. They tell me they love the home but that this is a buyers market and they want to offer $420K. I know that the seller will not or can not take this much and that this will alienate them and I and that the buyer will not get a response let alone the home.
Beyond that I can not seriously work for the Buyer as a Dual Agent because I do not believe in or support their cause. The minute I sign that contract as their Buyers Agent I am violating State Law and in Breach of my Fiduciary to that Buyer. That is specifically why I do not complete the process and ask them to get another agent to represent them.
That is my choice. I never said I would not present any offer. Of course I would. But I am here to sell homes and represent my clients...buyers and sellers. This sale could have happened at $475K and would have been a good value for the buyer and a reasonable outcome for the seller. But we all know that Buyers read all this horrible press and of course it does not apply to all situations and all markets.
This is in fact 100% accurate in my State. I feel sorry for any agent in a State where you have to become the slave of any buyer making a low and insulting offer.
Now go out and have a great day people!
Dirk T Knudsen
"The Real Estate Doctor"
Your agent can not refuse to submit an offer $80K below listing if that is your wishes; that is if he/she wants to stay as your agent.
The agent might want to advise you if he does not think the offer will be accepted, or if he thinks this is so low that it might offend the seller. But you are the one who is buying and if that's the price you want to offer at, your agent should respect your wishes - he works for you.
I also hope that your agent has the skills to talk to the listing agent and present the offer in such a way that the seller will give serious consideration of your offer and make a counter offer is that the seller's desire.
On the listing agent's side, a listing agent has to present all offers presented to the seller unless the seller specifically request not to look at either a certain offer or any offer.
In the current market, I think a listing agent will be wise to present all offers and advise the seller to look at and consider all offers, and at least counter the buyers back. The important part is not to take things personal. But yes, your agent has the duty to present your offer no matter how low the offer is.
Good luck on this.
A listing agent also has the duty to present all offers to the seller no matter how ridiculous they might be unless the seller instructed the agent in writing not present any offers that are lower than a certain price. An agent is only the extension of the principal, but the principal will always be the decision maker. In other words, the principals acts through the agent and the agent has to make sure that he does not exceed his authorities as an agent.
I hope that helps.
Best of luck.
In California our laws state all offer must be presented. It is also stated that all offers on Real Estate must be in writing. Therefore all written offers must be presented to the seller for their decision. It is our duty to present the offer even if it is 80K under asking.
Lisitng agent must present all written offers regardless of the price or terms. Verbal offers do not need to be presented.
Buyer agent may decline to write an offer for buyer. Buyer has choices of many alternative agents to approach to write the offer on his/her behalf. If a buyer agent has a deeply pessimistic view of the offer, it is better for the seller to have another agent write it and represent the buyer.
If a buyer approaches a listing agent, the listing agent may direct the buyer to another agent to represent him/her. If that buyer does have another agent prepare an offer, of course, the listing agent will present it.
And for Ruth. You are right we are here to share and to learn from each other so we can improve ourselve. However, from your tone of voice, I feel that you are very aggressive to response to the questions. I did not mean to offend you or other associates. I did not mean that if I know or licensed agent that I am better than others. I still have a lot to learn from other associates in the industry. I am not perfect but I'd like to share what I know and if I am wrong someone else will tell me if I was wrong then I will correct my mistake. I guess you know more than me so my apology if I was wrong. I hope you still remember what Christ said to the people wanted to stone the woman who they condemned her as sinful - " let those among you without sin, cast the first stone". I just stopped by here to read some debates and I regretted that I spent so much time in here to get cursed. Sorry about that. My fault indeed.
I deleted my response because when it posted, I saw that you responded and I wanted to read what you said first.
THANK YOU. You are right, I read your post wrong. And I agree with you 100%. Thanks for clearing that up.
I think you came to my defense the last time I questioned a CA agent about CA practices. All I know about CA real estate is what I learned here (over the past 6 months and reading 1000 CA Q&As). I'll have to read through all of your other posts now.
As for Dual Agency, we had a thread about that too, again I can only answer in my area where we rarely get into Dual Agency relationships even when we have both sides. Yes I know it's unebelievable for people in other parts of the country but it's different here. It's like when I tell buyers they need a letter from a bank when they make the offer, as per the seller: "What? are you kidding? I don't have a letter. I have the money, I've bought and sold 100s of houses", it's like how dare I ask them to prove they can afford it. On the other hand, bringing a prequal is standard operating procedure in other parts of the country.
The purpose of Trulia Voices is to LEARN about the real estate industry. Just because someone is a licensed real estate agent doesn't mean that they know everything about the industry or are even correct. Marissa may not have asked a question leading to the sort of answers that she is receiving. She may not have known enough to know that there were other questions to be asked. Please see my referenced post.
P.S. regarding referenced post: http://www.trulia.com/voices/Market_Conditions/Do_Realtors_e
Ute did not respond on that one and I think she was the one who first enlightened me to the term "unconscious ignorance" or something like that. Paul Slaybau... said,
* "Unknown unknowables" is a phrase coined by Mr. Rumsfeld and chronicled in one of Bob Woodword's books about the current administration's war planning. * in another one of my questions:
I miss Ute and Paul
Your agent will help you to get the best deal. All he/she needs is a strategy for his/her best negotiation. You will never know what good it will be if your agent and you works as a team. You need to have a plan to convince and let the sellers know why you want to offer below asking. You always have the bargain power of the buyer. Buying a house is the biggest investment of your life then why can't you negotiate for the best deal? I don't see any reason at all. If you are first home buyer, you will be pleased if you find out that there is no other time better than this time for you to get loans with below market interest rate and grants for down payment money. It is available in all the states. Check it out before starting to find your dream home. Good luck with your quest in searching your dream home.
I'm thinking this is along the lines of someone being accused of a crime has a RIGHT to legal representation, not mandated to have representation. If I choose to represent myself, I am not considered practicing law.
If I chose not to be represented by a Broker, I believe you still must present my offer. It's like the old days when all the agents represented the sellers and no one "protected" the best interests of the buyer. You should have an attorney write up a disclaimer for the buyer to sign stating that the buyer "Has a right to remain silent. Anything you say or do may be used against you. Do you understand these rights?" And then also, you do not have a right to any commission nor will the commission be reduced against the purchase price.
DO WE HAVE SOME PEOPLE TO BACK ME UP ON THIS ONE?
It is completly up to the Listing Broker if they wish to present your Offer if you are asking them to represent you as well as the seller.
All real estate is local, and in case any one in NY is reading this, in NY ALL OFFERS must be presented to the seller whether or not you are working with the listing agent or another agent, unless the listing agent has in writing a note from the seller saying they do not have to present offers under X.
There is a belief that as Realtors we have to represent someone but in fact we do not. We can simply say no thank you and dircet the buyer to another agent. I like to handle that situation by submitting a signed letter of intent or even an email. The seller usually will respond with what the answer is. If the parties can get close enough on a Sale than I take it to contract.
Great question and I get that one all the time!
"The Real Estate Doctor"
If your offer should insults the sellers, they may refuse to deal with you ever.(even with a full offer). You risk the chance of ever getting the house you truly wanted. A good agent would be aware of this potential scenario and advise you accordingly.
I scrolled through to find this one:
and in the post I refer to I made this comment:
"Theory and reality are two different things just as the law or rules might be different than doing what is right or moral."
Another thread worth reading is this:
This is a tough question, because every situation is different.
I can really only answer this question as if you were my client.
If 80K below the offer can actually be justified, backed up with comps of SOLD homes. Then yes I would present your offer.
If 80K was just a low ball offer? Then once you put the crack pipe down, I would tell you that you need to find yourself a new Realtor.
Back to your question.
Yes. Listing agent must present all offers.
No. buyers Agent can refuse to present.
There may have been a similar offer that was presented before and refused. The listing agent may know that the seller is unwilling to go below a certain dollar amount and is trying to save everyone time and energy.
If the agent you are working with is trying to discourage you from writing the offer, I would sit down and ask for the reasons.
Typically when looking at writing an offer you will need to consider the location of the property, the condition and the asking price. All three of these factors will determine final sales price.
Are you talking about your buyers agent, or the listing agent? Who is refusing? If you want to make a legitimate offer on a home, your buyers agent should be willing to write it up. If you have already written up an offer, and the listing agent refuses to tell the seller about your offer, that is unethical.