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Contingent on Buyer Selling His Home FSBO. Would You Allow That?

By Tim Maitski

Real Estate Agent with Atlanta Communities Real Estate Brokerage GREC #208281

June 04, 2007 02:55 PM

I received an email from a buyer who wanted to know if he was getting jerked around on a request by the seller. The seller would only accept his contingent offer if he listed his home with a real estate agent.

He stated that his area is pretty hot right now and thought that he would be able to sell his home himself without the help of a real estate agent. He thought that the listing agent was making an unreasonable request in wanting him to have it listed with an agent.

I thought I'd throw the question out and maybe he could see various opinions here.

As a seller, I would never take an offer that was contingent on the sale of another home that wasn't under contract, let alone a home not even listed yet. I just don't see the reason to do that. You take your home off the market and hope that another one sells instead? Throw in the possibility of the other transaction being put together and proceeding without any professional guidance and I think you have the makings of a very stressful situation.

I get nervous when a contract is contingent on completing the sale of a home that is already under contract. Before this is acceptable:

I want to see a signed contract
I want to know that the buyer of the other home has his loan approved.
I want to have it past the inspection contingency period
I want to see a large amount of earnest money.
I also want to talk to the agents involved in that transaction to get a sense of how solid the deal is.

Do you think sellers should accept an offer that is contingent on the sale of another home?

Do you demand that the other home be listed with a real estate agent?

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Doug McAnally

RCP Realty Group, LLC - Calera, AL

Working Hard to Make your Experience Easier

I think it is up to the sellers as to whether they accept an offer that is contingent on another home selling. We have no choicebut to presetn all offers and even though we might not like the offer our only recourse is to present the offer, prsent our opinion and then let the client decide what they want to do. I accepted a contingent offer on a home last year but placed another contingency that if another came in they had 48 hours to get financing or I would move to offer 2. We placed the home under contract but also that back up offers were still being accepted.

Jun 04, 2007 03:10 PM

Eveline Tritsch

House 2 Home Realty - Las Vegas, NV

Yep-ran into one of those when I was first an agent, years ago. My buyers had lied to me - imagine that! -and said they had their home listed with an agent. They walked into one of my open houses...I showed them some others in the neighborhood...they had an honest to goodness CASHIER'S CHECK for $10,000 for earnest money deposit...your ideal buyer right?...not yet. Wrote an offer on a home...when it came time that evening to check their story for myself to see if their house was indeed listed with an agent...it came up as a listed -withdrawn-listed-withdrawn every single month on the same day with a different agent! HUUUHHH?????? Needless to say the listing agent on the home we wrote an offer on checked the same thing, and guess what? REJECTED.....end of story, my new agent mishap, one of many, but I did learn a valuable lesson. Sorry this became so long....

Jun 04, 2007 03:12 PM

Gregory Maley

Sold Buy the Sea Realty & R.E.N.T. - Wilmington, NC

REALTOR, GRI, CBR, SHS, e-PRO, ABR

Obviously the "listing agent" isn't making the "unreasonable demand" the seller is making the demand. After all, he hired an agent to market his property. He knows FSBOs don't have much success. Why on Earth would he take his property off the market in hopes that this other person would have better luck than he would. And, no, I would not encourage my seller to accept such a contingency. Like the author of this post, I don't even like a contingency on a home sale for a house UNDER CONTRACT, leave alone a house that's not even listed.

Jun 04, 2007 03:26 PM

Gary L. Waters Broker Associate, Bucci Realty

Bucci Realty, Inc. - Melbourne, FL

Eighteen Years Experience in Brevard County

Tough call but...no, well maybe. If the house is under contract and the mortgage is not contingent on selling the other house, maybe with a "kick out clause." Accept the offer but continue showing. If a better offer comes in then the buyers can remove all the contingencies IF they want the seller's house.

Jun 04, 2007 03:28 PM

Elaine Reese, REALTOR® in central Ohio

Real Living HER, Powell Ohio - Powell, OH

We do contracts with buyers whose home is in-contract - we call them dominoes cause if one falls down they all do. I once was involved in a 4-domino deal! We made it, but there was nail-biting at the last minute. There are a few contingent-escape contracts (when the buyer's home isn't in contract but on the market) but in this market, not so many of those anymore. But absoltely no FSBO's - just too risky!

Jun 04, 2007 03:32 PM

Roger Stensland

Keller Williams Realty Puget Sound - Maple Valley, WA

Let's Move!

I think that the seller has every right to refuse to take any contingent offer that he wants.

Jun 04, 2007 03:41 PM

Kristal Kraft

Novella Real Estate - Denver, CO

Selling Metro Denver Real Estate - 303-589-2022

Tim ~ Setting minimum standards for an offer/contract is the reason we are able to get things done. There is a difference between trying to sell your house and selling your house.

What was it that Yoda said, "There is no try, just do."

Or something like that...

Jun 04, 2007 04:14 PM

Todd Clark - Retired

eXp Realty LLC - Tigard, OR

Principle Broker Oregon

We had someone in our office have this exact situation come up about a year ago and boy did it backfire and cause 4 different closings not to happen.

The agents sale and buy the FSBO sale and the FSBO's buyers home. It was just a comedy of errors that all lead to one person the FSBO.

Jun 04, 2007 06:21 PM

Randy L. Prothero

eXp Realty - Hollister, MO

Missouri REALTOR, (808) 384-5645

I can not imagine any reason to accept an offer that is contingent on a home selling that is not even in escrow.

No need to discuss the FSBO part.

Jun 04, 2007 06:46 PM

Tony Gallegos

Cognicorp Mortgage Banking Advisory - Marietta, GA

Tim - I'm with you on this one. I don't blame the sellers requesting they list their home with a professional Realtor.

Jun 04, 2007 07:08 PM

KRISTINE CROWE

COLDWELL BANKER RESIDENTIAL BROKERAGE - Dundalk, MD

I would say to accept it with a kick out clause.

Jun 04, 2007 09:40 PM

Greg Cremia

Shore Realty of the Outer Banks - Nags Head, NC

I only recommend contingent sales if the other property is under contract. Anything else is a gamble and I would rather gamble on my expertise than someone else's. A fsbo would be out of the question unless the seller was desperate.

Jun 05, 2007 12:38 AM