The FBI is focusing its attention on real estate brokers to see whether or not the broker submitted all offers to the lender in a short sale transaction. A real estate broker who does not submit ALL offers to the lender could be charged with being involved in a conspiracy to commit fraud against the lender.
Please take a look at this link FBI focusing on Real Estate Brokers on submitting all offers
I would love to get your feedback on this one.
All you had at that point were offers, you did not have a contract so it really would not matter anyway. Countrywide was not the seller
In AZ, our Short Sale Addendum to the Residential Purchase Contract (AAR Form used by Buyers who submit offers on Short Sales) states the Seller MUST submit all subsequent offers to their lender (lines 13-15). We are able to "omit" those lines in our Additional Terms Section of said Addendum by stating that "term" is not applicable and is to be omitted. The requirement to submit all offers is then "contractually" negated and puts the onus on the Seller to accept or reject or counter this term/condition. If, as a Listing agent of a Short Sale, who receives an offer with those “terms” omitted (now making submitting subsequent offers a breach of contract) am I at risk? If I’m adhering to the Contract, am I at risk. Who do I answer to? FBI? Banks? Seller? My Broker? I see this as a clear cut contract law issue. I follow the Contract! If I’m crazy, please tell me.
Brent Hammonds, Associate Broker Solutions Real Estate, Scottsdale AZ.
Doesn't the FBI have better things to do? I'm not a party to the executed purchase contract (of which there is only one).
And I think they should. In my short sales I prefer not to have the buyer. I want the bank to feel confident we have the best offer and if I have the buyer they may think I am hiding other offers. My first commitment is to have the job done for the seller.
I will never submit all offers for a very simple reason. You have many buyers and will end up with none. My job is to close on every short sale. That being said, the FBI is looking for fraud. It is NOT the FBI job to tell me how to do my business. Because I will never commit a fraud, I am not worried, anybody can come and check my files.
In case I have multiple offers I will ask buyers agents to submit their clients highet and best form. I can not hold several buyers for months. One of the reasons real estate market has been difficult the last years, is exactly because realtors are not choosing the best offer and keeping houses on the market even if they have several offers.
Once I have an offer that I believe the bank will approve I will mark the property as deposited. Will ask buyer to do inspections - yes, before bank approval if they want to buy my short sales - and also require them to sign contract, subject to bank approval, and put money down. I need a buyer who is commited to the property.
If after having a deposit another better offers shows up I will tell we are under agreement. Very simple, exactly the way we do with regular transactions, no need to panic!
Short sales are not deals for everybody. Those who don~t feel confortable dealing with short sales would make a better service to their clients by referring them to someone who knows what they are doing.
Well said and I agree, thats the same way I do business.
I question if that board even has their story straight. This whole 'all offers' thing stemmed from a few agent/investors who would list a property and after receiving an offer, submit their own lower offer to the bank. When the bank approved their lower offer, they would flip the property to the buyer who was willing to pay more... walking away with $10-100k.
I have heard straight from JP Morgan Chases mouth at a Short Sale Seminar that the seller should only accept 1 offer and you should only submit ONE offer .. even if a higher offer comes in after the original offer is accepted. After all .. that is what a contract is for .. an agreement to sell.
I agree with many of the other agents. The seller is NOT the lender. The lender plays only a role as to if they will agree to forgive the seller the debt that can not be paid back. They do not have a role in what offer is to be accepted.