Today I was sitting in an Open House today and a neighbor came in, said hello and then walked around taking a look at the home. I asked her a few questions about her needs, wants and future plans and provided her the property information and how to reach me. She looked sad, distant and like she was about to cry. I asked her if everything was ok and as she was about to answer, another couple arrived and she ducked out the door.
The next couple came in and stopped to have a lengthy chat and ended up setting an appointment to meet with me later in the week. They were in my open for nearly 20 minutes, which was pretty long considering most people are in and out of opens in less than 5 minutes unless they really like the place. Well, seconds after that couple left, the lady, we'll call her Brooke, came back in to my surprise. She still looked upset and had that look in her eyes that said, "I need someone to talk to". I asked her to come in and as I did, I quickly scribbled on one of my sign-in sheets, "Will Be Back in 10 Minutes". I asked her to wait in the house for a minute and went and removed my open house sign from the end of the driveway and then posted to note on the front door.
I could see this lady was in distress and I wanted to have a moment alone with her uninterrupted. I came back in the house, offered her a bottle of water and said. "Tell me what's going on and I'll see if I can help". The tears started welling up even more and she simply asked me, "When you have clients with a home to sell, do you recommend they sell before buying a new one"? I said it depends on their situation and their goal, but in most cases yes.
She said they just moved in down the street 5 months ago and they purchased the home without making their offer contingent to the sale of their current home. She said their agent adised them it would make their offer stronger to the current sellers and in the current market, it should be no problem selling their current starter home. The tears got even heaveir! She said that she was so upset, because they were running out of money and just missed their first payment on the old house and if it did not sell soon, that they were going to face default and likely the property would go into foreclosures or could maybe be a short sale if the bank would work with them.
Wow! I said, that's a really tough spot to be in. She said what made it worse was that they had several friends living in their old neighborhood and their kids still go to school together so she was even more upset about the potential foreclosures sale and it's effects on their friends and their relationships. She was worried their friends would think her family is irresponsible and living beyond their means. My gut sunk! Her pain was palatable and my heart hurt for her. I was also irritated that her agent would give advice like he had provided. Yes, we are in a recovery and yes homes are selling quickly, but this isn't 2004 and there are no guarantees of sale.
I said that I would have likely suggested buying contingent to the sale of their current property unless they could afford to pay double payments for at least 6 months or had a renter lined up that could offset the mortgage payment. I said some agents need to chase a commission and give bad advise knowing that once you buy non contingent, you are much more likely to reduce and reduce the price on your current property out of desperation to get it sold. She said she wanted to purchase contingent but the agent was the brother of her husbands best friend and was very insistent that their offer would not be accepted and they they would never be able to move buying with a contingent offer. She is also upset with her husband because he won't fire the agent for fear of hurting his relationship with his friend. A very difficult situation to say the least. I talked to her for a while longer and tried my best to comfort her and give advise and when she left, provided her my contact info with an offer to help if I could. I simply said if the situation comes to a head and changes needed to be made, that I could maybe help them short sale one of the properties if possible. She said thank you as she walked out and then surprisingly stepped back into the door to give me a hug.
After my open was over, my open signs picked up and I had some time in my car, I thought about her situation and I was sad for her but also angry at their agent. When I got home, I looked the agent up to see his performance. He had more canceled and expired listings that he had listings that had sold and he only had less than 20 total closed sales in 6 years. Mostly buyers and thus it dawned on me that he may never actually had a listing that they had accepted contingent to sale of property offers and thus had likely never presented an offer with said contingency due to lack of experience. Based on his production, it seamed more likely he was not looking out for the clients best interest but more at getting a sale and addressing his own interests.
The difficult part about all of this, is you can only learn this lesson by actually experiencing it. You can help to avoid it by doing a strong interview of the agent you intend to hire to see if what they are advising make sense. That's the important part of an agent interview. If during the interview it feels wrong or does not make complete sense, it may very well be bad advice or lack of experience or market knowledge. I can't say what their agents motivation was, so I can't make judgment on him. I hope for the best for Brooke and her family and I hope this article helps other potential sellers avoid making the same mistake. Over my 12 years in real estate, I've delt with sever contingent to sale offers both from the listing and buyer side and in most bases, the buyers meet the contingency and the sales proceed. If you need help in real estate, please feel free to contact me.
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