Bad Contracts, Sloppy Agents

By
Managing Real Estate Broker with eXp Realty RB-19250

When we look at what is happening the last few weeks in our industry, what is the number one concern?  IfHobo you were going to make an offer on a home to purchase it, what would be the one thing you would focus on?

  1. The financing

In the last three weeks I have received four of the worst contracts I have seen fired off by agents to my sellers.  

The contracts were missing:

  • A pre-approval or even a pre-qualification letter from a lender.
  • Signatures stating they have an earnest money check.
  • Signatures from their brokers stating that they reviewed the offers.
  • Signature from the agent on the lead based paint addendums.
  • Three did not have a cooperating broker's agreement. (I guess they did not want to get paid).
  • Two of the contracts were marked N/A for special provisions and then had special provisions typed in.
  • Two were expired before they even transmitted them and one gave my out of state client ½ a day to respond.

All of these agents must have attended or missed the same contract writing class.

With the lending industry going through their difficult times and real estate markets going through changes; it is not time for amateurs. If you do not know what you are doing, team up with someone who does or take up another occupation.  I hear there are shortages in the hair cutting and fast food industries.

OK, I apologize for venting.

Posted by

 

--------------------------------------------------------------------------------------------------------

Randy L. Prothero, REALTOR®

Broker-in-Charge, ABR, AHWD, CRB, CRS, e-PRO, GRI, MRP, SFR

eXp Realty

Team Leader - "The Prothero Group"

Randy Prothero is well established as an expert in working with military / VA clients and first time home buyers.  His home seller's (listing) campaign is one of the most aggressive marketing programs in the area.  His luxury home listings sell faster and for more money.

Based out of Mililani, Hawaii. Randy services the island of Oahu (Honolulu County) Performs mediations and ombudsman services for the Board of Realtors.  To improve overall professionalism in his area Randy also offers classes for real estate agents. 

www.HawaiiRandy.comOahu (Honolulu County) Property Search  Hawaii Military Relocations

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Rainmaker
787,667
Mike Jaquish
Realty Arts - Cary, NC
919-880-2769 Cary, NC, Real Estate

Randy,

It is even better when the Broker writes it and you have to give up after a half dozen attempts to get it right.

Aug 20, 2007 02:54 PM #20
Rainmaker
299,253
Kathy McGraw
CELLing Realty - White Water, CA
Riverside County CA Real Estate

Randy,

I would like to comment on: "The brokers are also part of the problem, they are not overseeing the agents."

I have been seeing some terrible contracts lately from some of our agents.  After reviewing one I was so shocked I highlighted all the errors, printed it, and drove 3 hours to go over it with the agent that wrote it.  I spent the whole day doing contracts and counters.  Ok, so far so good.

Then yesterday I was reviewing another one, and lo and behold almost the same mistakes........I told the agent that she needed to go back to class and learn as obviously my teaching wasn't getting through.  I also told her no more contracts are to go anywhere before I see them first......and this agent has been in the business for 23 years.

I already have a formal letter written, and a ban on any dual agency until and such time as this agent completes a Formal Contract class.....

Sometimes I wish I was still an agent :)

 

 

Aug 20, 2007 04:01 PM #21
Ambassador
750,298
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Randy...  it just makes you wonder if they are lazy, lack common sense, or just don't know what they are doing. Yes, it's sad no matter what the answer is. Because each answer as a solution. Keep venting to make others aware of this.

jeff belonger

Aug 20, 2007 04:10 PM #22
Rainmaker
337,585
Thesa Chambers
Fred Real Estate Group - Bend, OR
Principal Broker - Licensed in Oregon
sounds like you have a good reason to vent.... glad we could be a sympathetic ear
Aug 20, 2007 05:44 PM #23
Rainmaker
338,442
Gary Bolen
McCall Realty - South Lake Tahoe, CA
CRS - Lake Tahoe Real Estate Information

This is all pretty much part and parcel of the current market climate. Like many say here in this comment trail, lets hope a lot of this kind of work falls by the wayside, and those that don't aspire to excellence along with it.

Just saw a comment you made on something of Nima's and agree with you. We just posted a different take on the mortgage climate and think we pretty much solved it. Or maybe not.

No need to apologize for stating the obvious. We recently read something of Lenn's about someone who worked for her that is a Lazy Boy salesman now. That wasn't venting either. And you are right on... it is no time for amateurs.

Aug 20, 2007 07:19 PM #24
Rainer
12,536
Sybil Holcomb
Ayres Realty - Douglasville, GA
I see this kind of contracts all the time and it drives me crazy.  Contract states they have received the earnest money so I ask for a copy of the check.  Oh!!! it seems that it will be a week before they can give her the check.  My thought---well duh, you wrote in the contract that YOU HAD THE EM.  It's amazing.
Aug 20, 2007 10:13 PM #25
Rainmaker
834,678
Chris Griffith
Downing-Frye Realty, Bonita Springs, FL - Bonita Springs, FL
Bonita Springs Listing Agent
I just had a contract a few weeks ago where I had to hen peck for every crossed T and dotted I.  The agent was "annoyed" that I kept asking for each and followinng up.  Too darn bad, punk!
Aug 20, 2007 11:39 PM #26
Rainmaker
1,540,002
Gary L. Waters Broker Associate, Bucci Realty
Bucci Realty, Inc. - Melbourne, FL
Fifteen Years Experience in Brevard County
Randy - On the plus side, you are getting activity. On the negative side, you are getting activity from less than competent agents. Given a choice, in my market, I would take the incompetent ones at this time...but only while it was slow. Realistically, we should all expect only the very best quality from colleagues and let them know, in a gentle way, you are lacking! Good job, Rando~~
Aug 21, 2007 12:51 AM #28
Rainer
132,170
Lysa Napolitano
Daytona Beach, FL
Randy, Vent away, but pls don't send them to beauty school :(. Imagine those results!
Aug 21, 2007 04:33 AM #29
Rainmaker
3,064,103
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty
Wonder if the co-broke can be variable based on how much work they Buyer Broker accomplishes, and how much the Listing Broker has to do for them! :-)
Aug 21, 2007 05:25 AM #30
Rainmaker
662,741
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Mike - That is really bad.

Kathy - I guess years in the business do not guarantee quality work.  I find that as I get older I have less patience with that kind of stuff.

Jeff B. - I see similar problems in every industry.  Because of the value of our products, it is even more critical that those involved are professional at every level.

Aug 21, 2007 05:34 AM #31
Rainmaker
662,741
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Thesa - Thank you

Gary - Absolutely, this is the time for professionals and the others need to get out of the way.

Sybill - I see the same thing with the pre-approval letters.  I just had a transaction where the lender said they verified the funds; to later find the buyers did not have their cash.

Aug 21, 2007 05:43 AM #32
Rainmaker
662,741
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Chris - I think that if ever office mad a policy of missing docs or missing signatures, no commission check.  Most of these problems would go away.

Erica - That is a lot of work to be a Million Dollar producer.  Here in Hawaii that is between one to three sales depending on if you are doing entry level condos.

Gary - I am always concerned that if we go into escrow with an agent that starts like that, where will this transaction be heading? Almost ever one that fell out of escrow started that way.

Aug 21, 2007 05:50 AM #33
Rainmaker
662,741
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Lysa - I still look for professionals when I get my hair cut.

Tony - If not, possibly we can offer an hourly rate to walk them through the process. :)

Aug 21, 2007 05:52 AM #34
Ambassador
557,268
"The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

Randy...

Hold on to your boot straps.

This is going to get worse before it gets better but deep down you know that :)

My educated guess is that is will take a year to weed it all out.

Be glad you haven't received an offer written up in crayon :)

TLW...ROAR!

Aug 21, 2007 07:07 AM #36
Rainer
54,833
Beth Young
PropertyInfo Corp. - SureClose - Houston, TX

Randy, right on!  As a coordination team that is often left to clean up the mess and close these transactions, we appreciate agent's that realize that if the contract is poorly written, chances are it is only going to get worse as the transaction progresses. 

TLW, we have a saying in our office: "Nobody ever handed Picasso a box of crayons and expected a masterpiece".  Unfortunately, we get a lot of crayons thrown our way these days.

Aug 21, 2007 08:56 AM #37
Rainmaker
662,741
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Erica - I know a great real estate agent who can help you find the perfect home.  :)

TLW - I am waiting for the offer in crayon.  I have gotten more than a couple hand written.

Beth - On the flip side, clean contracts will get put your clients in a stronger position.

Aug 21, 2007 11:01 AM #38
Rainmaker
147,221
Kaye Thomas
Real Estate West - Manhattan Beach, CA
e-PRO, Manhattan Beach CA
Randy.. This shouldn't surprise you.. our REALTOR® associations refuse to demand higher standards for new licensees.. If you pass the mirror breath test you can be an agent.. I suppose this all works when times are easy but in today's market there is no room for the poorly trained.. One of these days the pweres that be will finally figure it out... maybe 
Aug 21, 2007 02:08 PM #39
Rainmaker
161,606
1SG (Ret.) David Kucic
Hawaii Military Realty, Inc. - Ewa Beach, HI
President and Owner
Its not just the amateurs or new agents.  I recieved a purchase contract on one of my listings that was just about as bad as you described from an agent that had been in the business for over 30 years!  Some of the veteran agents are just as bad as the new agents.
Aug 22, 2007 11:57 AM #40
Rainmaker
662,741
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Kaye - Higher standards will always get my support.

David - I also got a bad one from an agent recently who has also been around for awhile.

Aug 22, 2007 09:59 PM #41
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Rainmaker
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Randy Prothero

Hawaii REALTOR, (808) 384-5645
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