It wasn't where we started but we did close yesterday. It can happen but it is pretty rare
that a buyer selects the first house they see. Also, it can happen that a buyer will go under contract more than once before they finally close on a home...but thankfully that is rare also. We just got done working one of those rare occasions and have another anecdotal instance to add to our many reasons buyers benefit from using a Buyer's Agent.
that a buyer selects the first house they see. Also, it can happen that a buyer will go under contract more than once before they finally close on a home...but thankfully that is rare also. We just got done working one of those rare occasions and have another anecdotal instance to add to our many reasons buyers benefit from using a Buyer's Agent.Our client originally called in to see one of our own listings that turned out not to be a good fit for him but since MoonDancer Realty was a good fit, he hired us to act as his Buyer's Agent from there on out. During our conversation, it became apparent that he'd worked with another agent and had even made an offer on a house. In response to my question about the status of his relationship with that agent and that of his offer, he commented that the agent hadn't reviewed any agency disclosure with him and he knew the agent was not acting as a buyer's agent. As for the offer, he didn't know what the status of it was because the agent was not doing a good job of keeping in touch and that it had been a month or better since he'd signed the offer. Screech and apply brakes!
First things first, the buyer was advised to formally withdraw his offer in writing and to email me confirmation. Signed offers are living, breathing entities unless the are countered by the other party or unless the maker of the written offer rescinds or cancels the offer. So, that was done but the buyer still liked the house. In any event, we continued to look at houses and when the buyer got frustrated at not being able to find the house that would suit him, we started looking at vacant lots. That first house never left his mind though and eventually we made another written offer.
What a nightmare!
The sellers accepted the offer and then the nightmare began. Turns out we needed third party approval (which hadn't been disclosed) and yep...we were engaged on the slippery slope of short sales. As most agents know, there are many scary additional forms to fill out when considering a short sale and lots of pitfalls to consider. At this point, the Buyer had every right to not continue since technically the Buyer had not agreed to purchasing a short sale but we weighed the pros and the cons, the Buyer chose to proceed.
We submitted the forms and waited for third party approval. Once we received it, there were strings attached. One of which was a decrease in the amount of compensation to the agents. This was one of the pitfalls of a short sale that the Buyer and I had addressed early on. In a Buyer's Agency agreement, the Buyer agrees to pay the Buyer's Agent ONLY if the agent is unable to collect from the seller or seller's agency or to make up any difference between the amount of compensation the Buyer's agent has disclosed they expect and whatever is ultimately paid. In our instance there was a shortage of 1% on the buyer's side. The other pitfall with a short sale is a very abbreviated time to conduct Due Diligence, including inspections, title work, appraisal and financing obligations. The financing was no big deal, this buyer was pre-approved. I recommended that the title work be addressed first since I knew getting the home inspection could be done very quickly.
A very long story shortened...the attorney discovered that this property had no legal right of way to the state road. There were also recorded instances of failed lawsuits stretching back 30 years to obtain legal right of way. Bye-bye deal and hello "that was a close one"! We withdrew the offer and had the earnest money returned.
We started looking again. A few months later a foreclosed property that seemed perfect appeared. No...no more nightmare, it was perfect. The buyer still had to make up for the shortage in the compensation for the Buyer Agency but this time it was only 1/2 percent...I kiddingly - no maybe not kiddingly, told him it was a bargain. He agreed.
He closed yesterday and all is right with the world. He had a thorough title search done, a new survey, home inspection, pest inspection and appraisal. The house appraised for some $40,000 more than he paid. The house is the right size, the right style and in the right location. He's a happy man and will never now serve as an excellent advocate for Buyer Agency. :-) His future referrals to MoonDancer Realty will be excellent, those folks will already grasp a few of the many reasons buyers benefit from using a good Buyer's Agent.
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