Dead beat Buyer or Dumb Agent (Me)?

By
Real Estate Broker/Owner with J. Luis Properties, Inc.

Ok here's the skinny:

I represented a buyer (No buyer broker agreement in place, this was a "friend") who was in the market for a cheap REO or short sale. I informed her that REO's and short sales could be a lengthy ordeal. Of course she said she had time. She wanted to take advantage of the exceptional deals out there but was limited by her budget. I showed and showed and showed until she decided on a listing that I had sent her via e-mail that I had taken her to see. We wrote up an offer and sent it in only to wait and wait and wait before I finally was able to contact the listing agent at which time she informed me that all offers require a DU approval. Mind you this was not spelled out in the listing nor when I spoke to her assistant. Well after that was cleared up we sent in the DU and waited some more. After several e-mails I finally got a confirmation that everything was in order and submitted to the bank. We waited another 2 weeks and after several calls still no answer from the bank. Then after over a month the buyer gets frustrated and decides the whole ordeal is too stressful and decides she wants to wait a few months before jumping back in the market. I follow her instructions and fired off an e-mail to the listing agent to pull the plug immediately. After receiving confirmation, everyone parts ways to live another day.

Here's the kicker:

The bed wasn't even cold yet and the buyer submitted another offer with another agent 10 days later. The offer was accepted $10,000 over what she had originally offered. I see this woman every week at our networking meeting and she tells me, "You'll never guess, I just closed on the house you put an offer in for 10k more than what we offered." I said, "What offer?" trying not to choke her! She either doesn't have a clue or she is just plain stupid. She just screwed me out of my commission that I worked months for and has the audacity to flaunt it in my face.

Did I mention I have all e-mails listings, contracts and communication saved as a concise pdf ready to fired off to the State real estate commission and local MLS board? I'm so disappointed right now I don't know which route to take. I know it probably won't go anywhere but I want to ruffle feathers and make a few people lose sleep. This is not how deals are done and I want it to be lesson for all involved because if we don't police our selves this crap will just keep happening.

I need your advice AR bloggers, how would you go about handling this for ultimate effect, satisfaction and possibly monetary compensation?

P.S. No one will get in my car anymore unless they sign a buyer agreement!

Noel Padilla, CDPE

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Location:
Florida Miami-Dade County Kendall
Groups:
Realtors®
The National Association of Hispanic Real Estate Professionals
Tags:
buyers
agent
reo
short sale

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainer
74,490
Tom Schoenbeck
Keller Williams Realty at the Beach - Rehoboth Beach, DE

Interesting Noel.  I just responded to someone's blog the other day about this very same issue. I guess the bottom line in this situation is you had no Buyer Agency Agreement in place and the friend was entitled to work with whomever she chose at that point. You could make a point of a presumed agency relationship and procuring cause, but I strongly doubt it would work in your favor. Maybe the toughest thing is to chalk it up and move on.

Sep 12, 2009 08:54 AM #1
Rainer
128,274
Linda Powers
Resort Realty - Duck - Duck, NC
On the Outer Banks

What about procuring cause? You may be able to prove to the selling broker you are due commission.

Sep 12, 2009 08:56 AM #2
Rainmaker
139,250
Cooper Jacobs
Looking For A Seattle Realtor? COOPERJACOBS.COM - Seattle, WA
Real Estate Brokers - Seattle

friends need buyer agency agreements more than than anyone else:)

Sep 12, 2009 08:58 AM #3
Rainer
22,349
Noel Padilla
J. Luis Properties, Inc. - Kendall, FL
CDPE

Tom

It's oh so hard when you're oh so mad.

Linda

That's what I was thinking

Need a Lynwood Realtor

I was told after this happened that you need a one page agrrement with a stranger, a two page agreement with a friend and a ten page agreement with family!

Sep 12, 2009 09:10 AM #4
Rainmaker
782,352
Ron Trzcinski
Century 21, The Real Estate Centre - Nottingham, MD

Yes, you should have had a Buyer Agency Agreement, and yes, it may be difficult to win a procuring cause case.

In Maryland, we have "Presumed Buyer Agency" for when we first start working with a potential buyer (when we are not already representing the Seller), however, it requires a written Buyer Agency Agreement when a contract is submitted.  I bring this up because of the origin of presumed buyer agency.  In your case, your "friend" could very easily have presumed that you were working for her, however per Maryland law, without the written agreement you would actually have been working for the Seller.  Without a proper disclosure, she would have a good case against you that you were not working in her best interests while it was presumed that you were.

My point with presumed buyer agnency is that perhaps the logic can be reversed and you can say that you presumed that she was in an agency relationship with you.  You certainly have the documentation to show that this was the case.  She acted the part of your client.

On another thought, is it possible that there was something happening behind the scenes?  It seems odd that she would so quickly be going back to the same property after she had waited for such a long period and obviously was fine working with you up to that point.  Did someone from the other side agree to cut the commission to make the deal work and cut you out?

Sep 12, 2009 09:23 AM #5
Rainer
22,349
Noel Padilla
J. Luis Properties, Inc. - Kendall, FL
CDPE

Ron

The commission was a 2.25% on a $155,000 sale, I don't know if it was that or a family friend or if she felt I wasn't agressive enough. Many times I felt she didn't believe when I told her that the listing agent wouldn't respond or when I told her these things take time. She was a first time buyer so she really doesn't know but I like you smell a rat.

Sep 12, 2009 09:28 AM #6
Rainer
22,349
Noel Padilla
J. Luis Properties, Inc. - Kendall, FL
CDPE

There's hope! Here's an interesting blog I found that supports my position!

http://www.marconews.com/news/2009/jul/23/its-law-procuring-cause-earns-commission/

In part it states:

In the Venture Vest Realty case, a broker brought buyer and seller together and negotiated terms over a two month period, but no sale took place. Five months later, the buyer and seller revisited the transaction with different agent, resulting in contract and sale. The original broker sued for a commission and the court held the parties had excluded him from the later transaction. He first called the property to the buyer’s attention and he was entitled to a commission.

Sep 12, 2009 10:02 AM #7
Rainer
65,625
Alyce Martin
The Realty Group, LLC - Albuquerque, NM
Albuquerque - THE Place To Be!

OUCH! I really feel for you and I'd be mad as a wet hen.  Sounds like you were the procuring cause but it's probably more of a headache and you'd look like a jerk if you pursued it.  I don't get BBA's either because to me they're not enforceable.  Sorry this happened to you but I'd just move on and make better friends.

Sep 12, 2009 10:08 AM #8
Rainer
22,349
Noel Padilla
J. Luis Properties, Inc. - Kendall, FL
CDPE

Alyce

I've got plenty of aspirin, lol!

Sep 12, 2009 10:16 AM #9
Rainmaker
107,765
Mary Jo Quay
Remax Advisors - Minneapolis, MN

It can happen to any of us even with a representation conntract.  Most buyers don't understand when they  are getting the best possible service.  When we help friends or family they don't see us as professionals, and take our time and expertise for granted.  Even if you win, it will cost you time an energy. 

Sep 13, 2009 02:43 PM #10
Rainer
22,349
Noel Padilla
J. Luis Properties, Inc. - Kendall, FL
CDPE

Update

I spoke to the agent involved and turns out to be a really nice guy, of course he had no idea which was my suspicion all along. I still haven't decided what to do. Maybe I'll just write a blog post and post the Vice President of Bank Atlantic's (Kendall Branch) name all over........hhhhmmmm.

Sep 14, 2009 12:24 PM #11
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
22,349

Noel Padilla

CDPE
Ask me a question
*
*
*
*
Spam prevention

Additional Information