Seller taking an offer before it hits MLS
We are seeing a lot of agents pre selling their own own listings that are short sales before putting them on MLS. I know we have a fiduciary duty to the seller not to the bank but this act of not exposing the property to the market to try to get the best offer drives me crazy. It not only potentially hurts the seller but drives down the comps in the neighborhood. I know some of you will say "I only had 2 days to get an offer to hold of the foreclosure" and in this case it can make some sense but usually it's a listing agent either representing both sides or trying to sell it to a colleague in their office.
I recently put on a short sale and got 11 offers after waiting the week to expose it to try to get the best offer for the seller. It sold for $43k over asking. I could have recommended that the seller take the first all cash offer at asking price or double ended it over and over for a lot less money but I felt an obligation to the seller to try to get the best one. Not exposing it to the market would have not only hurt the seller but also affect the comps in the neighborhood. I also thinks it's our job to try and get the highest price for the bank.
I am curious if anyone can tell me why banks with short sales don't require agents to expose the property for a period of time like REO's do?
I think we should have a standard of care not only to our clients but to the neighborhood and to the bank in some regards.
What do you think?
Replies to This Discussion
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Permalink Reply by Jeff Payne on
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Mark, you sure are an expert for the 2 short sales that you have been involved in.
I have a very good idea of what a property is worth and what the banks will accept based on nothing more than experience. Again, you want to make assumptions based on nothing. I have overpriced properties and had to make adjustments to get it within range of market value. I have also underpriced properties and got multiple offers just like the original post here stated, that property was underpriced and got multiple offers. I have also listed properties, REO, equity and short sales that got full price offers the first hour that they hit the market and in all cases the sellers had no reason to not accept the offer.
BTW, to answer your question, I closed 5 Bank of America short sales last month and only saw that addendum on one of them and I signed it. Bank of America gets a copy of the listing agreement, MLS number and MLS sheet and knows how long the property was on the market and knows when the offer was accepted.
I am still waiting for George to answer a question too. How many short sales in your market go under contract before they hit MLS? That is an easy thing to find out, simple MLS search will find it. Afterall according to George and his office mate Stephen, it is rampant which means that the numbers are easy to find.
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Permalink Reply by Mark on
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So on that one that you closed, was it put on the MLS?,
did you make a good faith effort to market the property?,
or was this a pocket buyer?
In other words, are you complying with that agreement, or not?
If so, why?
If not, why?
As for George's "rampant" comment, in my area it's pretty darn common, at least a couple agents every week are brazen enough to mark an insider deal as "pending" within minutes of sending it out - and contrary to what you posted, there is no way for me (as an agent) to search for that criteria.
Although a quick database run at the request of law enforcement could probably yield hundreds of hinky deals worth researching - certainly a couple of those agents have a legitimate reason for doing that, others, well...
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Yes I closed it, and it was put in MLS. Was not my buyer. I already told you that I only work with sellers. The bank has a copy of the listing agreement, the MLS sheet and the contract, not hard to see how long it was on market before a contract came in. If there is something on any bank addenda that conflicts, I either refuse to sign or cross out offending statement and sign.
Mark, again, you are talking out of your rearend, Pretty darn common? Should be easy to prove, Smitty just posted that it has happened 6% of the time in her area. If you have MLS access, you can certainly look it up. If it happens like you say, all you would need to do is pull up all of the short sales that went pending in the last 30 days and see how long they were on the market before going pending. That is IF you have MLS access.
Sure there are hinky deals out there but it is not rampant like you seem to think. If it were, the FBI would not have ignored your complaint, they would have been all over it.
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6% seems "rampant" to me - considering all of the dollars at stake.
And those are just the dimmest of agents, I'm sure the more experienced fraudsters have the sense to at least pretend to be accepting offers for a while.
I'm not sure where you're going with your "if you have MLS" comment, I already told you that I am an agent, and I do have MLS access - Not everyone's interface is the same, believe me - were it possible for me to review all of those deals, I'd do the homework *for* the FBI, wait for the deals to close, and cheer loudly as the agents were "frog marched" to tent city.
There were 1,966 short-sales closed in the past 30 days in my market, no way I'm picking through all those listings manually - using Smitty's percentage (6%), that would give you approximately 117 of the most brazen listings that ought to be looked at by law enforcement - in one city, in one month.
But I really don't need to "investigate" anything - several here, including yourself, have admitted to not making a sincere effort to market these properties.
I'll take you back to that language in the B of A addendum...
"“the subject property has been listed on the local multiple listing service at fair market value to provide open market competitive bids to present to the seller as per the terms of the seller/agent listing agreement, and that the marketing is in fact and ‘in spirit’ seeking to maximize the selling price of the property.”
In all but the rarest of circumstances, how does this language "harm" your client?
Seriously, HOW???
Why can't you "in spirit" "seek to maximize the selling price of the property"?
Time is a factor in a small percentage of these cases, certainly not all or even most of them.
Let me tell you straight, I don't like servicers, I know they're often stupid and unreasonable at times, but... the paragraph above seems kinda.. reasonable. fair, even. "Goes-without-saying" -ish.
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6% is ramapant, that is hilarious. Keep trying Mark, I have some really good friends in Phoenix who actually are agents, I will ask them to look it up and post it for you. I was getting at the "if you have MLS access" because I highly doubt that you do based on many of your posts here.
You continue to assume. So out of those 117 listings or 6%, do you know if they were FHA short sales that had the PFS approved price? How many of those had a looming foreclosure date? How do you know that time is a factor in a small percentage? You have the details from each sale?
How many short sales have you worked as an agent? I doubt any. You were on the buyer side of 2 and now you are an expert on short sales, MLS misrepresentation and fraud.
Please point me to the part that said I don't make a sincere effort to market a property?
the funny part of this is that you claim that you went to the FBI and didn't hear anything back from them, that should be a clue that what you think is happening is not actually happening or the FBI would have contacted you back.
Oh, I forgot to add in my last post that the 2.7% of the listings that were undercontract in one day or less, NONE of them were represented with the same brokerage on both sides.
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It's hard to say how many deals like this are happening but I would say that one deal is one too many.
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Sorry, I didn't respond to your BofA addenda that you found online. Last month out of 5 BofA short sales I saw that addendum once and I signed it. The property was in MLS and we got a full price CASH offer that the seller accepted. Remember that Bank of America is not the seller and the seller selected an offer from another agent that was full price, CASH with no contingencies.
Mark, if you were an agent, you would understand that highest and best offer is not always the highest offer. If I have to explain you would not understand
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Sure, I'm not an agent, I don't know *anything* about real estate, contracts, business, ethics or life in general. Your opinion is the only one that matters, I'm sorry to have offended the great and powerful "Jeff"...
please don't "smite" me.
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So Mark, what I am reading is that you say that we should "sit" on perfectly good offers for days, waiting in case someone else wanted to write, risking those buyers walking?????? Huh???? And you say you're an agent????
We are, by law, required to present offers in a timely fashion. Not only that, but our MLS REQUIRES us to present offers immediately. What you are suggesting is against our MLS rules. I don't think our MLS would have rules that would attract the FBI to investigate. (That sounds so incredulous I can't believe I just wrote it)
It is so obvious you do not understand the difference between a normal sale and a short sale. Our sellers do not hire us to "in spirit" market their homes. They hire us to "in reality" SELL THE HOME!
Get it through your head >>>>>> WE HAVE NO OBLIGATION TO THE BANK!!!!
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I never said "don't present offers", far from it. Please don't put words into my mouth.
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WOO HOO for Marcy. Mark is going to disagree because he is disagreeable by nature. He wont back up his claims with any facts, just his opinion. I gave him the numbers in my market, Smitty did as well and Mark thinks that 6% is rampant even though he has no clue of the circumstances.
Mark, how many homes have you sold? How many short sales have you done? Any agent can easily answer that question. I can actually answer that for you :)
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Nice Troll Jeff!
I never told anyone here I did thousands of deals.
I did provide facts, but you were so busy trolling you never noticed them.
We will have to disagree in regards to your insistence that I "would have to be involved in a fraud, to know what fraud is".
I know what drunk driving is, and I've never done it. I know what murder is, and I haven't killed anyone.
And I took the same ethics class you did "if you really ARE a Realtor®", Jeff, and obviously it was wasted on you.
Enjoy the troll-sandwich, I'm gone.
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