WHY would a Buyer make an offer than backout a day later?

I see a new trend and I do not like it. Perhaps they are teaching this at those "get rich in real estate using other peoples money courses." Let me get right down to it. A buyer makes an offer. The seller accepts. But then the buyer back outs. You may be saying this is not new, buyers get remorse...

EXCEPT this is not remorse. Investors are making offers on homes, then they try to sell the home or the contract within 24 hours. If they do not, they back out. Some will tell you, some will disappear.

Anyone yelling WHAT? How can this happen? Lastly, why do they want to do this? You see, they are trying to put a home under contract, then sell it using none of theor own money. Most do not have any money. Most learned this online or at a local "get rich in real estate" course. 

This is not new, it has been around for years. As a listing agent it is why we ask for pre approval letters or proof of fund letters with offers. It is why we ask for a deposit with the offer. It is why we pre qualify buyers before letting them see the home. 

Lets take this case and why I am writing about it. The buyer came to me, I immediately saw what he wanted to do and wanted no part of it. It is not in my sellers best interest. BUT, the seller is a bank. They know everything and have buyer agents submit offers to "their system" direct bypassing the listing agent. The said buyer then finds a buyer agent not experienced in this facet of real estate who writes and submits the offer direct to the seller. The seller accepts without any communication to or from the listing agent. Now  it is the seller aka "the bank" that demands this. 

The results is an accepted offer and a buyer who has 24 hours to sign teh banks forms. The buyer tries to re-sell the the property even though the MLS and the contract clearly reads "contracts can not be assigned."

Then 24 hours comes, the buyer cant sell it or realizes they can not assign and backs out. SO this is not the first, but third time with 3 different buyers i have seen in that last 2 months. In a talk with the asset manager who asked why this happens, i explained short and direct. The banks are taking what listing agents do best out of the equation, that is pre qualify buyers and their offers before submitting them.  

Will banks learn? Probably not. BUT owner occupied sellers as well as local investors should be on alert. BUT know when you list traditionally, buyers are checked, offers are checked and this is avoided. 

The lesson and my infamous message is do not hire just anyone to list you home. Do not just hire the biggest company or agent. Take time to hire the BEST agent. The way I do business is to offer some of the best possible personal and professional service. To stand by them through each step of the buying and selling process. Let me show you the right agent CAN make a difference.