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Found a house online in a city 75 miles away, inquired and ended up with realtor from listing agent's office. She showed us the house which we liked, said we had to sign her broker's rep agreement before we could make an all cash offer contingent on the sale of our house at the end of July. She said we could drive back with earnest money check later in the week during option period. Called very quickly that same day and said seller was strongly considering our offer and would be meeting with family the next day at 6p to discuss. Sat on pins and needles since we have to be out of our house in a few weeks. She called back and said that during the day, several stronger offers had come in and would we like to offer more. No thanks. Without any earnest money check, would they ever have taken any offer we made seriously. Were we just the bait for getting more offers? We haven't looked to buy a home in many years but feels like the whole system is rigged. Am I right?
So did you actually make a formal offer or not? -- It sounds like the realtor was trying to start a bidding war and was using you as bait/leverage. Can you check direct with the owner and verify what happened? - Did the house sell? -- Was the realtor the broker or an agent? -- If the latter, you might want to run the situation by the broker, but, it's probably water under the bridge now.
In some areas it's customary (maybe even required) to do so, but I never submit earnest money deposits with an offer. Instead, I have a clause in the contract indicating that a deposit will be made immediately upon acceptance of the offer--usually to the title company that will be handling the closing.
If you know the area where you'd like to move, contact a Buyer's Agent to represent you. I don't recommend working with a Seller's agent, even--or especially--if they're working as a Dual Agent.
So did you actually make a formal offer or not? -- It sounds like the realtor was trying to start a bidding war and was using you as bait/leverage. Can you check direct with the owner and verify what happened? - Did the house sell? -- Was the realtor the broker or an agent? -- If the latter, you might want to run the situation by the broker, but, it's probably water under the bridge now.
OP stated their agent was in the same office as the listing agent, but was not the listing agent. What motivation would there be for their agent to start a bidding war if that's the case? Agents prefer to get paid for their work. Working and not getting paid = agent
Quote:
Originally Posted by jackmichigan
In some areas it's customary (maybe even required) to do so, but I never submit earnest money deposits with an offer. Instead, I have a clause in the contract indicating that a deposit will be made immediately upon acceptance of the offer--usually to the title company that will be handling the closing.
If the OP could at least let us know what state they're talking about, it would be helpful. Like you, I don't give anyone any of my client's money until there is a contract.
Quote:
Originally Posted by jackmichigan
If you know the area where you'd like to move, contact a Buyer's Agent to represent you.
Sound advice. Hire your own agent and then you won't be asking questions like this.
We are actually moving out of state eventually but need to locate temporarily for up to two years due to elderly family health issues. The particular city the house was in was just one of several possibilites we had considered within a multiple county area. So yes we made a formal offer on that house using suggested price offer. It was an estate and the listing agent was the executor. The market is so strong here in Texas that it makes sense to park our money in a house rather than savings or stock market. And leases are ridiculously expensive for anything decent. Ironically, we sold our own house as a FSBO and so far it's been a nicely transparent piece of cake. Would almost rather not use any realtors at this point.
The OP stated "option period" which probably means Texas. It not no longer customary for the Earnest Money to accompany the offer as most prefer to wire the funds directly to the title company once the contract is executed.
All over Texas, there are multiple offers in many markets. For the OP to think a house they love is not a house other people also love is ridiculous. It happens everyday that someone submits an offer, other offers have come in and the agent has to contact their client to say "best and final offer is due at X time". If the OP wants the house, they'll play the game. If not, sit back and see if your initial offer was already better than the others, probably not.
Sounds rather normal and not at all "rigged" from the brief description.
Fact is homes that are well priced in areas with solid demand often do get multiple offers -- rates are low, inventory is tight, and this time of year is generally an peak period for relocation.
Folks that are serious often will have "all the ducks in a row" so that they can submit their earnest money check along with a formal offer. Folks that are not as well prepared will not look as serious to sellers.
Sellers tend to prefer offers with no contingencies over those that include the buyer needing to sell an existing home.
The OP should "live and learn" -- if they know where they need to buy it makes sense to find a buyer's agent there ahead of time. Similarly if they have an awareness of what sorts of earnest money is customary they ought to talk to their bank to get an appropriate account / check situation pre-arranged. If they are serious about moving they should have their existing home listed at a price that will help it to sell at least as quickly as is average for the sub-neighborhood they fall into in their local MLS database -- agents that represent home seller in the new town should be able to look at this info and understand that the buyer is serious and not just a "looky Lou" but will want to get a deal done...
We are actually moving out of state eventually but need to locate temporarily for up to two years due to elderly family health issues. The particular city the house was in was just one of several possibilites we had considered within a multiple county area. So yes we made a formal offer on that house using suggested price offer. It was an estate and the listing agent was the executor. The market is so strong here in Texas that it makes sense to park our money in a house rather than savings or stock market. And leases are ridiculously expensive for anything decent. Ironically, we sold our own house as a FSBO and so far it's been a nicely transparent piece of cake. Would almost rather not use any realtors at this point.
If you only plan to own it for less than two years, I'd still give serious consideration to renting as opposed to buying. Who knows? The market could tank if a certain person gets elected President (pick your side). I think you'd need to get a pretty good deal to be able to buy and sell in such a short timeframe and come out ahead...but it's certainly possible, especially if you can keep you closing costs down. But nothing's guaranteed.
As I mentioned, any offer we make will be cash when we funded in two weeks. It has been a real learning experience that's for sure. It doesn't help that there are so many people (and lots of investors) swarming here with cash buying up anything below our price point. However, I wish that the realtor would have been forthright about not even bothering with a contingent on sale offer as it wasted a lot of our time. Lesson learned...
I wish that the realtor would have been forthright about not even bothering with a contingent on sale offer as it wasted a lot of our time. Lesson learned...
That's not fair. The contingency is YOUR option, not the agent. I tell my clients all the time that contingency offers are not as strong, but as their agent, I can't tell them not to put in a contingency if they have a house to sell before they can finance or pay cash for their new house. Your offer has to be full disclosure to the seller about what your situation is.
And, you never know when the seller will accept a contingency. It's not just about price, it's about all other terms within the offer. If there was another cash offer at the same price as yours, then they look at terms. If both were contingent, then they look at other terms within that are strong in one offer over another. Maybe you asked for 10 days for the option period and the other buyer offered 5. Maybe you offered a 45 day close and the other offered a 3 week close. Maybe the other buyer offered to pay the owner's title policy but you asked the seller to pay yours for you.
Stop beating up the agent and learn from your own mistakes within the offer you made and make it stronger next time.
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