On Submitting Purchase and Sale Agreements

Home Builder with Retired

On Presenting the Washington State Purchase and Sale Agreement

In every state, laws have been enacted to help the public move through life with a regard for the accepted way of completing certain transactions. Some procedures have been found so damaging to the public interest that they have been made illegal. The real estate industry is guided by many such laws.

Some industries, like real estate, have practitioners who form groups, like the REALTORS®, which have devised stricter guidelines in the form of what we call our Code of Ethics. From the Preamble to the National Association of Realtors® Code of Ethics:

In recognition and appreciation of their obligations to clients, customers, the public, and each other, REALTORS® continuously strive to become and remain informed on issues affecting real estate and, as knowledgeable professionals, they willingly share the fruit of their experience and study with others. They identify and take steps, through enforcement of this Code of Ethics and by assisting appropriate regulatory bodies, to eliminate practices which may damage the public or which might discredit or bring dishonor to the real estate profession

Code of EthicsWhere this Code of Ethics and state or national law conflict, the obligations of the law must take precedence.

Over the past decade we have moved through a housing bubble and a bust. Strange and unusual practices and techniques have developed. I follow many news groups and blog sites concerning the real estate industry and one particular practice that has arisen before and is here again, is one which is bothersome for me.

Agents sometimes lose sight of the scope of their obligations.
Sellers sometimes give instructions that agents shouldn’t follow.
Buyers sometimes make demands that agents don’t want to follow.

For example: Between 2004 and 2007 many offers were grossly in excess of the asking price, and were often accompanied by other concessions from the buyer and/or buyer’s agent to make the deal more likely to favor that particular buyer. In most cases, this is merely an indication of how much the buyer wanted to buy the property.

But, I’ve been reading lately, where buyers are offering “side deals” to owners selling short, to cover moving expenses, and bonuses to listing agents for stronger consideration of their offer among the many, if there are multiple offers.

This appears to be the same thing as above, but in the case of a short sale, it is a matter of defrauding the bank. If the value of the property to a buyer is the price on the purchase and sale agreement, plus the moving expenses gift, plus the agent bonus, shouldn’t all of that money be applied to the mortgage? I’m not a advocate for the banking industry. But I am an advocate for following state and federal laws and the REALTOR® Code of Ethics.

As an agent, I know that, in Washington, all written offers must be presented to the seller. Failure to do so may be breaking a law. It is not my place, as a listing agent, to tell a buyer’s agent not to write an offer because the seller won’t go that low.

As a seller, (including banks, but they do it all of the time) to demand certain restrictions on offers, or to say that you don’t want to see them unless certain conditions are met, is asking your agent to break a law. Just accept delivery of them and counter them, or not, as you see fit.

As a buyer, you have a right to offer any price you want for a property. And, if you have an agency agreement with a real estate licensee, that agent should forward your wishes. That’s reasonable. Please don’t ask your agent to do anything illegal.


As always, I am not an attorney. I am a REALTOR®. Creative real estate practices by everyone from Main Street to Wall Street got us in trouble over these past few years. Let’s not be too creative once again in our zeal for recovery or personal profit.

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Glenn Roberts




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Roger D. Mucci
Shaken...with a Twist 216.633.2092 - Euclid, OH
Lets shake things up at your home today!

Sorry I'm a day late, but this post is excellent Glenn.............well deserving of being Featured.

Apr 21, 2011 11:21 PM #19
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Glenn. We are only required to present legal offers and according to our sellers instructions. My seller may instruct me to only present offers that meet a certain price minimum. They can do that. 

Short sales have definitely brought out the worst on folks. Mostly because of frustration. Banks are making up the rules as they go along and some make no sense whatsoever. So agents, buyers and sellers are thinking of ways to skirt around these unreasonable rules. Problem is that we can't act illegally or unethically just because the lender is doing so.

Apr 21, 2011 11:54 PM #20
Glenn Roberts
Retired - Seattle, WA

Melissa - The ethics on both sides of the table need to be improved. Sounds like the way Washington Mutual was run.

Roger - This isn't a Facebook Birthday. You are never too late.

Bryant - In Washington, all offers must be presented. After one is accepted, others may be solicited by the owner by requesting a status of sold pending/backups requested. Otherwise, they should not be submitted.

Apr 22, 2011 01:02 AM #21
Howard and Susan Meyers
The Hudson Company Winnetka and North Shore - Winnetka, IL

Exceptional post Glenn.  

We're surprised that an offer that carries an obviously fraudulent component would be required to be presented.  If we were to attempt to explain to the seller that we felt it may be fraudulent and it were then accepted by the seller, we would then be a party to that fraud.

We need to be cognizant of right and wrong at all times.  Common sense will usually dictate when something is "wrong".

Apr 22, 2011 01:54 AM #22
Glenn Roberts
Retired - Seattle, WA

Howard & Susan - We absolutly need to be cognizant of what is wrong and not be a party to it, or instigate it. I'd like to see more licenses lost for such errors in judgment.

Apr 22, 2011 03:50 AM #23
Patricia Aulson
Realtor - Portsmouth NH Homes-Hampton NH Homes

Great post today, thanks for getting it out to us today.


Patricia/Seacoast NH & ME

Apr 22, 2011 04:23 AM #24
Evelyn Kennedy
Alain Pinel Realtors - Alameda, CA
Alameda, Real Estate, Alameda, CA


Your post should be copied and pasted on agent's foreheads so they remember what is ethical.  No matter what your clients asks of you, you have to do what is legal and ethical.  It is not worth risking your license to comply with your clients wishes.  Follow the law and our Code of Ethics and you can't go wrong.

Apr 22, 2011 04:44 AM #25
John Juarez
The Medford Real Estate Team - Fremont, CA

We all know that we need to submit all offers to our sellers. However, in California, if a seller gives me written instructions that he/she/it does not want to see offers of a certain type I do not have to present those offers. I can notify the person making the offer that the offer is unacceptable in my role as agent for the seller. I cannot make decisions that the seller needs to make but if the seller has already decided that certain offers shall not be reviewed, so be it.

Apr 22, 2011 03:59 PM #26
Glenn Roberts
Retired - Seattle, WA

Patricia - It's been a slow news day.

Evelyn - It's not rocket science but often money gets in the way.

John - Interesting to learn about how other states handle that. Thanks.

Apr 22, 2011 04:11 PM #27
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

The potiential criminal charges and loss of license is enough to keep me from doing it.  I would not object to some of the side deals (moving expenses and such) if it were legit, which it is not.  Those side deals can be abused too and I think that is why the banks do not like them.

Apr 22, 2011 04:26 PM #28
Ranji Singh
Century 21 Heritage Group Ltd. - Newmarket, ON

Hi Glenn,


Funny how many believe that rules and laws are really only meant for others, or that they can permit themselves to shirt the law jsut this once, then twice ....


Great post.

Apr 22, 2011 04:40 PM #29
Sheila Newton Team Anderson & Greenville SC
Berkshire Hathaway HomeServices - C. Dan Joyner - Anderson, SC
Selling the Upstate since 1989

congrats on the feature.. it is well deserved.. great blog!!!

Apr 22, 2011 04:56 PM #30
Glenn Roberts
Retired - Seattle, WA

Gene - So many miss the point that there are laws and ethics. They only know that the deal is the thing.

Ranji - I agree, and they need to learn...the hard way if not in clas. They didn't learn from their parents.

Sheila - Thank you.

Apr 23, 2011 02:27 AM #31
Kimberly Brandon
Smart Moves Real Estate - Venice, FL

One thing I learned as a real estate trainer - ethics cannot be taught - but that is why we have the Grievance and Standard of Practice committees - report violators so we can get them out of our profession - The process makes sure the event was not just a mistake - it only hurts those who have a lack of ethics.  NAR requires we take their Ethics course once every 4 years - just to keep honest people honest - I would think once every year would be a good idea.

Apr 23, 2011 03:20 AM #32
Charles Edwards Bentonville
Coldwell Banker Harris McHaney & Faucette 479-253-3796 - Bentonville, AR
AR REALTOR, Bentonville Real Estate Agent and Broker

Glenn, It is quite a time we are living in. The surprises can come from any direction. Then legitimate buyers can't understand why their underwriter needs sworn affidavits in the file regarding their access to funds and so on.

Great post and feature worthy for sure.

Apr 23, 2011 11:35 AM #33
Glenn Roberts
Retired - Seattle, WA

Kimberly - Our broker seems to teach ethics weekly, by example at our meetings.

Charles - Not hard to see why so many are demanding more regulation of our industry to control the few abusers.

Apr 24, 2011 12:05 PM #34
Robert Courtney
Lihue, HI
Century 21 All Islands, RA, CDPE, MCRE, CIAS

The rules that guide us a Realtor® are there for all parties protection.  I do not think it difficult to explain how we must conduct ourselves to a buyer or a seller.  If they want to go down some road that will jeopordize our career, we have to be willing to make the right decision.  Unfortunately, those of us that make the right decision are not written about.  It is those in the ranks that want to gamble that catch the eye of the press and government officials.  Glenn your post is a sound reminder to us to stay in control of our transactions.

Apr 24, 2011 08:03 PM #35
Glenn Roberts
Retired - Seattle, WA

Robert - the difficulty is, how does one make the honest agent stand out?

Apr 25, 2011 02:49 AM #36
Charita Cadenhead
Keller Williams Realty - Birmingham, AL
Serving Jefferson and Shelby Counties (Alabama)

Wow Glenn.  How ironic.  I just wrote a post about integrity in our business.  Even when the seller says a 100 times that they won't accept an offer below $xx.xx, you just never know when they might change their minds.  So even when you get the offer for the 10th time that is below that number, you still have an obligation to present it to the seller.

Apr 25, 2011 03:21 AM #37
Glenn Roberts
Retired - Seattle, WA

Charita - We always need to keep on our toes, and keep reminding others that the right way is the only way.

Apr 25, 2011 03:49 AM #38
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