How Big Business Is Changing the Real Estate Landscape

You, the consumer, decide you want to buy or sell a house. You hire a local real estate agent to assist you - or do you? Maybe you think you'll try to use technology to save a few bucks. Here's a real life example of how that works and what it means to you. 

Yesterday, I was out previewing homes for an investor. Normally, appointments are easily set up through Centralized Showing Service (CSS). I can do that through our MLS website or by calling the local number. But this one house was not on CSS and the agent's phone numbers were an 800 number and a number in Illinois (Illinois?). Curious. So, I call the numbers and got one of those recorded messages where the voice tells you to press this button. How irritating. The calls went on for more than 20 minutes and I was still pressing buttons. Frustrating. 

Later, after I'd previewed the other 9 homes on my list, I went back into MLS to the odd listing and went through their website (Hubzu.com - owned by Altisource) to get the showing code for that one house. When I entered the number they use to identify the listing, a screen of 16 homes for sale popped up. Homes for sale in Florida, Illinois, California, Michigan but NOT Missouri or Kansas! So, after registering on their site, I entered the MLS number and finally got the combo to the lockbox for the house I want to preview. Big time waster but that's not the end of the story. 

If my client decides to make an offer on that house, I would have to use their contracts and delivery system. In case you are unaware, standardized contracts created by local Boards of Realtors© are updated to keep current with changes in federal, state, and local laws applicable to that particular locale. Contracts approved by each local Board of Realtors©  allow individual buyers and sellers to customize their contract with specific needed/wanted contingencies. Our contracts also include verbiage and procedures to protect buyers as well as sellers of real estate. 

Do the contracts used by banks & third party sites provide the same protections? Not so much. Those contracts are like going back in time to 'Caveat Emptor' (Let the buyer beware). About the only contingency that the buyer can choose in those contracts are the price and closing date. There is very little to negotiate about; you do what the bank wants when they demand it and forget about protecting your rights or getting anything you want. Most of these types of contracts include language to protect the bank and third party service providers from any title issues as well. 

Are you saving money when you conduct real estate transactions the way the banks like? Yeah, right, the bank is doing you a favor and worrying about your pocket book. Ha!

When we allow big business to do business the way they want to, we're allowing them to:

1. Circumvent the Standards of Practice that has taken the National Association of Realtors more than 100 years to develop. In other words, your rights are being flushed down the toilet.

2. Make communication difficult. When you have a question or a problem, do you like calling a recorded message number and pressing buttons or do you prefer to speak to a human being? 

3. Adding unnecessary costs to real estate transactions - costs that you have no control over. The real estate and mortgage industries are closely regulated and prohibited from charging excessive fees. When submitting offers or bids on the sites set up by third parties, you will be paying whatever fees they decide to charge. It's not an option. It's not negotiable.  

When you work with your local real estate agent to buy or sell a home, that agent will spend their paycheck on local taxes, at the local grocery store, local restaurants, and local shops. That agent will donate money to local charities and buy things from local schools during fund raisers. When you pay big conglomerates for the privilege to buy a house, who knows where their money goes? How many students at your kid's school have parents who work for Deutsche Bank? Do you think these conglomerates support your church or your local businesses? Do they pay local taxes to maintain your roads & parks? 

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