Here is what I dont get... Buyer's agetns who NEVER.... EVER.... Remove contigencies.....
So if you don’t know me, which I assume most don’t. J I am primarily a listing agent. I have so much going on with all my hobbies, that showing buyers has become tough. I do work with select buyers though, so I do see both sides of the coin when it comes to the following thoughts.
In a recent transactions and many times before, I have found that the buyer’s agent will NOT remove contingencies for one reason or another. The most recent and common that I have found are as follows;
Seller is doing repairs needed to clear the appraisal – buyer wont remove appraisal contingency
- Buyer and Seller agreed to RFR (request for repairs) and so all items are to be fixed to clear appraisal
Seller is doing other repairs – buyer wont remove inspection contingency
- Buyer and Seller agreed to RFR (request for repairs) and no other inspections will be done by buyer
The buyer’s loan is not (100% done) meaning we are not at docs - buyer wont remove loan contingency.
- Buyer has 21 day to confirm that they have the loan ready to go
Each scenario needs to be broken down for its intricacies, which I understand and we can go into detail on each.
We as agents need to understand that we there to advise the client on such matters BUT in no way should we be pushing them in any certain direction. Meaning, a buyer’s agent also needs to take into account that there is a seller, who has their time (time is money) on the line as well as the buyer’s.
Maybe this is a matter of details where agents do not understand contracts and contractual procedures and law. I hate having to send notices to perform to buyer’s agent and then have to sit down and explain contract procedures.
Example; in scenario 1. The agent and buyer do not want to remove the appraisal contingency because we have to clear an item for the appraisal. In this case the shower had a leak. Appraiser went to property during the work and had to confirm that work was completed prior to close. We used the RFR process and full agreement was made. At the time of the contingency removal, agent states “we cannot remove the appraisal contingency because the work is not done. Let’s clarify this. The appraisal came in at value with an item called. Item was addressed and repairs are agreed to being done, buyer’s agent needs to understand that the appraisal contingency needs to be removed. If the work is not completed it now falls under the issue of seller none performance to the agreement. Yes Mr. Buyer’s agent you need to “protect” your client but you also have a seller hung out on the line, spending thousands for your buyer. The work is once again not an appraisal contingency issue but a breach of contract if not completed as per the RFR.
Example 2 is just the same as example 1. Seller agrees to complete work, buyer is satisfied with all their inspections, and buyer will not remove the contingency. The form RRRR in our state (Sellers response to buyer request for repairs) does have the “removal of contingencies” on it but the buyer’s agents won’t move forward with it. I have to go back again and go over contract procured and seller’s none performance. The work is now not the contingency the work is breach of contract if not completed.
The last one is the goody. Here is where the buyer’s agents and loan officers love to play games. More often than not, buyer’s agents will use the excuse “we are not ready for docs” “so we can’t remove the contingency”. Well think about this;
The seller has usually been waiting for weeks, for the buyer to get the loan taken care of. You as the agent should be over seeing this and understand that at some point, preferably in the time frame specified in the contract, the buyer has come to a threshold that you can give the seller some type of reissuance that the loan will close, even if you are not to docs yet.
What I find in this scenario is that the buyer’s agent is always “Looking out for their client’s best interest”. I do see where they are coming from but as an agent you also need to take into account all parties in the transaction. Our job as an agent is NOT to be one sided and put ourselves into the deal BUT we need to have the mindset of “let’s get the deal done”. I see this time and time again. Mr. Agent gives me their opinion about the issue and not their clients. I have had clients take offers under market and do other things against what I thought is right, but mind you, we are NOT the owner of the property, we are facilitators of the transaction.
P.S. Yes, I will say, that when it comes to contingencies, I will always advise my buyers as follows;
1. Inspections – I ask the buyer, are you satisfied with the property’s condition and all inspections and disclosures? If they are. I advise them that we agreed to remove our inspection contingency in 17 days, we need to follow the contract and I advise them on the ramifications of doing so. I also advise them on the seller’s performance and RFR if needed.
2. Appraisal – I inform the buyer that they appraisal has come in at value and review and RFR if needed. I ask the buyer, are you satisfied and ready to remove that contingency. I advise them that we agreed to remove our appraisal contingency in 17 days, we need to follow the contract and I advise them on the ramifications of doing so. I also advise them on the seller’s performance and RFR if needed.
3. AHH the loan. I go over with the buyer and lender the status of the loan and advise them on the agreement we have with the seller. In most cases, if the lender can give us a 90% assurance, that unless the house burns down we are good to go. I advise the buyers to remove their contingency if they feel comfortable and that we need to follow the contract.
I hope this helps out in any way.