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Are Agents Unknowingly Leading Sellers to Foreclosure?

By Denice Thompson Neddo

Real Estate Agent with Portland Vancouver Homes

February 24, 2009 11:03 AM

Saving the seller from foreclosure may mean saving the seller from the wrong agent. I work with a group of investors that are making offers on pre-foreclosure properties, and negotiating short sales. Once they acquire a property, they do all they can to sell it for a profit as soon as possible.

Recently, I sent out an email to my friends and email list letting them know that I have cash offers waiting to help people they may know avoid foreclosure. I received a call a few days later from a gentleman that got my number from a mutual friend. He explained to me that his house was about to be foreclosed on, and asked if I could help.

I explained how my investor's process worked and he said he was interested in seeing if we could make this work for him. He went on to explain that the house had been listed with an agent for quite some time, yet they had not received any offers. I told him I would need to contact his agent, and we talked for a few minutes about real estate agency. Later that day I received an email with his real estate agents contact information.

First thing the next morning I contacted the listing real estate agent for this house. I explained that I had a buyer with a cash offer and that my investors do the short sale negotiating. I went on to tell him these investors have their own paperwork and purchase agreements that they use, and that I would be able to get an offer to him in minutes if I knew a bit about who the lenders were, the amounts owed, etc. Here is where things got ugly....

Mr. Agent told me that he did not think it was in his clients best interest to have someone other than him (the agent) do the negotiating with the bank. He did not want to release the information necessary for me to determine if the house fit my investor's model for properties they wish to buy, either. I should have insisted at this point that he call his seller and let the seller make that decision. Instead, I moved on to the next property....there are so MANY!

In the meantime, Mr. Agent allowed the house to go to auction on the courthouse steps. He didn't even give the seller a chance to decide if he wanted to release the information and see if a short sale could be negotiated by someone other than Mr. Agent. I heard from the seller after the auction, and he wanted to know why we had not made the offer to purchase. When I told him that his agent felt it was not in his best interest, he was livid.

It felt to me as if Mr. Agent held so tightly to the hand of his client, that all he did was lead him right to the courthouse steps, where his house was auctioned away, lost to foreclosure.

I am not sure if Mr. Agent truly felt he was looking out for his client, or simply holding on to a commission that can not be there unless a deal is closed.