Hi folks. Today I want to play the "what would you do?" scenario game. The following, is a scenario that could happen to any of us so I'm curious to how you would handle it. What would you do if.........
First, business has been kind of slow. You're still making money but deals are far and few between and a really good closing would be a very good thing. You've been working very hard but have been supplementing your income with credit cards.
You have a listing. You took this listing several months ago as a single agent and just haven't had any luck getting it sold. The market is slow and houses of this style and price range are just not selling. The listing agreement expires in a week and even though you and the Sellers are on great terms they probably will not renew with you. It's priced at $400,000 which is very good for this particular market.
You are also working with some Buyers you met about a week ago. They met with a mortgage broker that you trust and he has them "sort of" approved. This means they are approved but very marginal. If rates go up or their FICO score or ratios move just a fraction they could be kicked out of the market. So it's about a 50/50. They're nice folks though and you want to try and help them get into a home. So they sign a BBA and you are working for them as a single agent.
After a week or so, of showing them properties, they show up at your office with a print out from Realtor.com. It's your listing that we mentioned above. They want to see it. (OK I'm going to skip the agency options for a minute). So you show them the house and they love it!!! They want to write up an offer.
You write up the offer and present it to your Seller(or do you?). The terms are acceptable to the Seller but the Seller ask you "What do you think? Are the Buyers qualified and will this deal close?"
Here's the scenario: First, depending on your State's laws, you will be in a Dual Agency or a Transaction Brokerage relationship at this point. This assumes, of course, that you are trying to double side the transaction. If you do double side it and it closes, the Buyer and Seller will be happy and you'll make $24,000. If you don't do the deal OR it doesn't close, you will be losing the listing anyway.
So what would you do? How do you answer the Seller's question knowing it's a 50/50 chance? Do you try to double side this transaction? Remember in a Dual Agency or a Transaction Brokerage relationship you can NOT work one side to the detriment of the other. You must be unbiased. Also, since you have already established a representation/agency relationship with the Buyer and the Seller reverting back to a non-agency or non-representative relationship is not an option, if you want to double side the transaction.
Now folks, bear in mind that I am a Florida Broker. Dual Agency is illegal in my State. BUT, it hasn't always been. I have practiced Dual Agency so I do know how it works. Also, I don't know if there is a right or a wrong answer. I'm looking for what you would do in this situation. So have at it. I will save my opinion until later. What would you do?
Here are some additional posts on Agency written by Broker Bryant.
All content copyright © 2007 - Broker Bryant Real Estate Ramblings