As my prior post talked about, agents are using the strategy of getting a Short Sale house in a multiple offer situation by offering more than the house will sell for. I even saw one the other day that fell back on language I hadn't seen in years ....Price to be $1000 more than highest offer. As an aside, I have always wondered what would happen on a multiple offer, more than one buyer put that clause in the offer It would go $ 1,000 over, then switch to the other buyer who would go $ 1,000 over, etc, etc. Obviously, if you do this, you must put a stop limit (not to exceed) number in, as well. But, as a listing agent, I am going to counter you at your max limit, rather than play with the $ 1000 increments, so it really doesn't help.
Back on track .....we were talking about agents overbidding for a house, knowing it won't appraise. I even had an agent in my own office question me as to why this is wrong, when they know it is the best way to get accepted in a multiple offer situation.
1. First of all, it is illegal for an agent to write an offer, knowing it if fraudulent. If you are convicted of Fraud, you will lose your license. Is any client worth that? I think not
2. And, if that doesn't get you attention, your E/O malpractice insurance will not cover fraud, so you will get named with huge attorney bills.
2. Lastly, it is morally as well as legally wrong. What you are doing is dishonest. And, it will be against the NAR Code of Ethics as well. And, if you have any religion.......well, you know where I am going with that.
Is getting one deal or pleasing one client woth the risk. As an Agent in San Jose, I can tell you it is not.