A Slick Trick (contingent, disclosure, auction, agent) - Real Estate -Brokers, appraisals, development, lease, investing, relocation, apartments, houses, condos, values, mortgages, loans... - City-Data Forum

Southside Shrek · 07-20-2007, 08:18 PM

how many of you have encountered this situation?

Buyer is shown a house and happens to like what he sees. No defects were noted in the Seller's Sales Disclosure statement. He informs his realtor "I wish to submit an offer on this house." The realtor responds "Sure, let me call Seller's agent." He calls Seller's agent who informs him "An offer just came in and I am going to present it to Sellers." Buyer's agent so informs the Buyer and says to him, "We must hurry up and submit a strong offer. Otherwise that house will get away." Buyer agrees believing there is another offer already in. An offer is submitted by Buyer close to the asking price..far from a low ball offer. Buyer even agreed to pay for closing costs, cost of an inspection etc.

the following day Buyer is informed that his Offer has been accepted. Buyer then asked "what was the amount of the other offer?" and has never been told despite numerous requests for that info.

does anyone believe there was another offer that Buyer beat?

olecapt · 07-20-2007, 08:37 PM

Give them two prices. One the one you were going to make and another contingent on an offer better your first being shown to you.

Southside Shrek · 07-20-2007, 08:49 PM

oh life is great isn't it?

I must admit though that it was a 'slick trick' and a way to try to move a house in a very slow and depressed market.

olecapt · 07-20-2007, 09:05 PM

Quote:

Originally Posted by Southside Shrek

oh life is great isn't it?

I must admit though that it was a 'slick trick' and a way to try to move a house in a very slow and depressed market.

It has been my experience that say they have another offer coming in...I discount those pretty much. If they tell me they have one I tend to believe it. Not that it is a good offer but that they have one. I then explain to my client.

If I have any doubt as to whether it existed I go to the Board and make a complaint that they lied. Costs $50. Well worth it to keep the system honest.

Southside Shrek · 07-20-2007, 09:48 PM

olecapt,
not only did the Sellers agent say that other party (Mr and Mrs Ghost) made one offer but then submitted an even higher one. talk about causing a 'stampede to buy'.

yep, a slick trick.

olecapt · 07-20-2007, 09:54 PM

No trick at all. If they have convinced a guy to bid against himself why woud you go there. Then you make a single final bid.

This of course presumes you were sure they actually had the other rich but brain dead bidder.

If you don't think they really had it...it is too late. You think about reality at the time not in hindsight.

If you have any doubt I would file a complaint. At least slow them down a little..

Southside Shrek · 07-20-2007, 10:15 PM

here's the point: where a realtor represents that another offer already came in and passes that along to the Buyer's agent and Buyer, the Seller's agent should produce verification that that other offer actually came in, especially when Buyer requests verification. Otherwise Buyer is wholly justified in concluding that it was indeed a 'slick trick'.

palmcoasting · 07-21-2007, 07:05 AM

Verification as in....? Showing you the offer? It is entirely within the sellers rights not to reveal what the offer was or anything to do with the terms. I have never been told what another offer was or why it was rejected over my customers. It's none of the buyers' business. It is not unusual to hear that there is another offer coming in, which, as with olecapt, I completely ignore. If I'm told there is another offer on the table, I ask if it's been executed and if not, please inform the seller another offer may be coming in. I advise the buyer not to panic...offer what they think is fair and just. If the offer is refused I again ask if the other offer was executed and if not then tell the buyer to come in with a best and final. Since a lot of 'offers' start out in the verbal phase I have no idea how an association would verify if there had been an offer to begin with..or what the point would be in filing a complaint, but hey...if you've got the time..

Southside Shrek · 07-21-2007, 07:21 AM

If a Buyer cannot be presented with some proof, i.e., verification, that another written Offer was in fact submitted as the Buyer was told, then it opens the floodgate for Seller's agents to scam.

olecapt · 07-21-2007, 09:29 AM

Quote:

Originally Posted by Southside Shrek

If a Buyer cannot be presented with some proof, i.e., verification, that another written Offer was in fact submitted as the Buyer was told, then it opens the floodgate for Seller's agents to scam.

Actually Realtors have an ethics Canon that forbids lying. And in general the duties required of an agent by the state forbid it as well. That is why the standard tactic is that "we are expecting another offer this afternoon".

Creating a fictional offer is a dangerous tactic. One common response is to simply decline to make the offer. Then if it does not sell you can make a lower offer on the basis that they can't get an offer near list. We had a recent incident where a property was suddenly dropped to too low a price. We called and the agent said he had multiple offers. We decided they were running an auction and our client decided not to play. The seller actual sold above his original price.

I think you will find the phony offer is quite rare. I would pretty much believe it even in a down market. I would not however believe it to be a good offer.