Offer over asking price - Posted by tyler davis

Real Estate Investing Real Estate Law
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Posted by Eric_MA on March 29, 2006 at 18:37:19:

If you offer a co-broke, you can only pay it if the seller pays you, and that doesn’t happen unless there’s a sale, and that doesn’t happen if there isn’t an accepted offer.

And the seller is under no obligation to sell even if the buyer offers one million dollars above list CASH.

The seller may also withdraw the listing from the market at any time. (which is not the same as canceling the listing.)

I know you know this, I’m just another REALTOR® who agrees with you, and I’m writing for the general public. :wink:

-Eric@woolhiser.com

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Offer over asking price - Posted by tyler davis

Posted by tyler davis on March 27, 2006 at 08:18:22:

We made an offer on a just reduced asking price of 480k. the home days away from going into default. we offer 495k seller to pay all occuring and reocurring closing costs not to exceed 15k, sellers agent informs us if we raise to 500k it will cover everything owed to bank and wont have to summit to bank for approval, we raise our offer to 500k with same conditions, and summit., Sellers agent counters to 505k now realizing closing date will have another payment due and wants to cover payment as well… My question is, If offer is summited above listing price already doesnt seller have to accept this offer, and not allowed to counter with higher asking price than what was published in mls, is it legal to raise his price like this or must he accept. buyers are now upset and walking away, and now Im out a client as well as a commission for a ligitamate offer over asking price with earnest monies of 10k put with it. Do I or my clients have any recourse here, thank you for taking my question.

Tyler Davis

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Re: Offer over asking price - Posted by Eric_MA

Posted by Eric_MA on March 29, 2006 at 18:54:24:

I see this all the time. An agent gets a listing with a property that is either upside-down or in forclosure, or both.

So the agent looks at the ammount owed, and adds his comission to it, and insists that that is the price the property MUST sell for.

In many cases, this causes the property to simply be overpriced, and it never sells. For my partner and I, it has created a niche market where we ask REALTORS® to refer such deals to us. We’ll list the property at the right price, negotiate a short sale with the bank and send a referral fee to the agent who brought us the deal.

That my friends, is being a true fiduciary for your seller. If you don’t know how to short sale, refer it to a REALTOR® who does. Oh, and you can get paid because it will actually sell this way.

Tyler, your obligation to yourself is simply to make the best offer on the market. If the seller can’t or won’t come down to it, find another deal.

I once represented a buyer for a house listed at 525K. We offered 400K.
The list agent then said perhaps the stupidest thing I will ever hear a list agent say:
“Well you know, we’ve had many offers. WE EVEN HAD ONE OFFER MORE THAN YOURS BUT THAT WAS SIX MONTHS AGO AND WE DIDN’T TAKE IT.”

So I pointed to my comps, and suggested to her that she advise the seller to either take our offer or get off the market.

They price reduced to 495, and then expired. It still hasn’t sold, and it’s been over a year. But I did my job, I wouldn’t let my buyer overpay, and end up being upside-down herself!

It’s not rocket science, it’s just real estate :wink:

-eric@woolhiser.com

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Re: Offer over asking price - Posted by Natalie-VA

Posted by Natalie-VA on March 28, 2006 at 20:49:45:

Tyler,

I’m a RE Broker. The MLS listing is merely an advertisement to sell. The Seller is not required to accept an offer. River City is right that the listing agent might have recourse, but it sounds as if the listing agent knew that the payoffs would be an issue.

–Natalie

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Re: Offer over asking price - Posted by River City

Posted by River City on March 28, 2006 at 14:10:26:

I don’t believe the seller is obligated to any purchasers to accept any offer. The seller’s obligation is to the listing agent. If the seller refuses to sell based on a contract agreement with the listing agent, usually the seller is bound to pay the commission due to the agent. My problem is with the seller’s agent continually increasing the sales price. It’s kind of like the agent is testing you to see how high you will go. Since this continues to happen, I would be tempted to submit my final bid and be prepared to just walk away. If you do submit a bid, make sure you have in the contract that the seller must convey clear and marketable title.

Good luck.

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Re: Offer over asking price - Posted by Max-Va

Posted by Max-Va on March 28, 2006 at 22:33:25:

Natalie,
If a property is listed with an agent for $200K and a buyers agent brings a full price offer with no contingicies, and the seller counters higher isn’t that buyers agent due a commission? I am in the same area you are and was just wondering how this worked.

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Re: Offer over asking price - Posted by Natalie-VA

Posted by Natalie-VA on March 29, 2006 at 08:40:31:

Hi Max,

I hope you are doing well. I could be wrong, but I’ll take my previous statement a step further…

As the listing firm, my offer of compensation to you is only an offer. Until we have a ratified contract, neither my seller nor I owe you anything.

I could be wrong…occasionally it happens! :slight_smile:

–Natalie