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sfbubblebuyer
@
2009 Jul 7, 10:04am
If it was an open bidding system, you'd get more transparency. You'd also get people one-upping each other by 1k increments. But it's still better than them telling you "Oh, another offer came in. You should submit your best offer!" when you've just lowballed a POS that's been on the market for 6 months.
Run, don't walk away from this realtor. First of all, if the realtor is refusing to present offers to the seller, that right there is an ethics violation and ILLEGAL. Realtors are bound by law to present all offers to the seller. That is probably the most important thing they teach them in their 3 month "get rich quick" course. Second, the realtor admitted to buying short sale properties themselves and flipping them for a quick buck. While not illegal, it certainly should be frowned upon as unethical and is one of the practices keeping prices from correcting themselves. Third, they are being completely dishonest about the economic situation we are all in. Incomes cannot support current prices and 33% off peak is about 20% too much.
In short, just another REwhore lying to get your offer. I wouldn't trust them at all.
1) how can you know if an offer is submitted?
You can't, that's why this is rarely enforced.
2) what is the law being broke?
The actual laws vary from state to state. Texas, for example, requires all offers received by the listing agent to be presented to the seller, regardless of how low they are.
3) is the trouble agent or broker?
Sorry, I don't understand the question.
This is part of the code of ethics that all REALTORS must subscribe to, but the difficulty is in how do you enforce it? The only way to enforce it would be to track down a seller and talk to them directly and ask if your offer was presented... not very likely so REALTORS take advantage...
# Standard of Practice 1-7
When acting as listing brokers, REALTORS® shall continue to submit to the seller/landlord all offers and counter-offers until closing or execution of a lease unless the seller/landlord has waived this obligation in writing. REALTORS® shall not be obligated to continue to market the property after an offer has been accepted by the seller/landlord. REALTORS® shall recommend that sellers/landlords obtain the advice of legal counsel prior to acceptance of a subsequent offer except where the acceptance is contingent on the termination of the pre-existing purchase contract or lease. (Amended 1/93)
Here is a great way to deal with the "we have multiple offers higher than yours" bs:
http://fieldguideforinvestors.com/we-have-multiple-higer-offers-yours
lyoungblood's link provides a very hilarious yet effective way to play the realtor's game. When I talked to the seller's agent, I was amazed how calm he was to admit what he is capable of. I was prepared psychologically and mentally how much this property worth in my own calculator. It is very similar to the wonderful posts above. I'm afraid if I showed negative emotion about the comments or rebutted too strongly, I might miss many good acts that were coming. I believe if we share our experience dealing with realtor, we can beat them in their own game.
I do wish if we can easily find out who the seller or asset manager is easily. That way we may be able to submit offer directly to the banks.
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Just visit a property in Inland Empire. I contacted the listing agent directly for a tour of a house I'm interested in. Here is my experience and my opinion-meter about this agent.
This agent is quite professional. Shows me around, points out the nice features. This is a short sale property. The agent seems very knowledgeable.
According to him, the owner got this house at the peak and got laid off. He helped the original owner bought this house back then and setting up the short sale now and the proposal will likely be approved by the lender. The short sale price is 33% off the peak price.
He immediately points out that he has total control of what offer lands on lender's desk while not against the rule. (I like him being honest on this aspect, up opinion-meter). This property has attracted 20 offers but mostly FHA offer with 3.5% DP. He also brings up the current market condition where a house usually get multiple offers and sometimes with over listing price if priced right(opinion-meter down a bit, feel likes he tries to prevent a low ball offer). He goes on saying banks are holding back many REO to create a scarcity on the market(honest, opinion-meter up). What's more, the economic is getting better(really, opinion-meter down, what an obvious big mistake) and the market will be more competitive in coming months and price may go up. I tell him the competition in the market sometimes are caused by realtor themselves buying the house at a cutthroat discount price and flip it immediately after some fixing. He admits he is one of these realtor(Very honest, opinion-meter up). Later in the conversation, he mentions if he were to buy this house, he will try to offer cash with 20% below listing price and lender may take it also. I think he is trying to test me but I think he is giving me an option that may work to my best(opinion-meter up). The conversation is harmony and well overall and I leave happily seeing what options I can have.
This property is in a good neighborhood so I think some of his comment like 20 offers are valid. I believe he knows very well that FHA loan is not easy to be accepted by the lender. With 3.5% DP plus the 8K credit for first time home buyer, if the house is underwater next year, the owner is very likely to walk away because nothing is lost from buyer perspective except with a free house rent for a year or two. TAX PAYER lost 8K instead. That is why the realtor has not submit the offer to lender yet.
I pointed out CA's unemployment rate just shoot up to 11.5% recently and this will cause more foreclosure and no end is in sight. How can a bank keep holding back those foreclosure on the book while the supply keep piling up? He did not reply and steer the conversation to other topic.
We will see what will happen in October to Dec this year. Also, why bank can keep holding those REO? What needs to happen to force them to release those REO?
#housing