Real Estate News & Commentary

A Nightmare Closing Saga – Part I

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27 Articles Written
Last year, I bought a house, rehabbed it and finally sold it. When I got a contract to sell it, the experience I endured was simply gut-wrenching. I got “sand-bagged” just about every way possible until I fought back… And WON! Here is what happened… This house was the first house deal I had done [...] View the full article: A Nightmare Closing Saga – Part I on The BiggerPockets Blog. This content is Copyright © 2017 BiggerPockets, Inc. All Rights Reserved.

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    Steven Boorstein
    Replied over 11 years ago
    Interesting article. Lots of mistakes being made… Your article glaringly point out a couple of issues that I see… 1. Real estate agents often do not know what they are doing. The bull market from 1998 to 2005 infused a lot of new agents into the market. Many of them “part timers”. This and other factors, including the fact that in my state, for example, they do not have to have any continuing education and they are not considered fudiciaries but “salespeople” in the eyes of the law… has created an environment where it is a career that is easy to obtain a license in, has not ongoing educational requirements and has salespeople that can put themselves ahead of clients. Not a good combination at all. That’s not to say that a good agent isn’t useful. I think that there are agents out there whom I think add plenty of value to the transaction… but you have to be careful of the others. 2. In my state of NJ, for example, I understand it that most all of the costs associate with the Title/Settlement company are fixed. So, it is really service that becomes the major issue. I don’t know if it is the same in your state. I think I would have either approached the title company directly or gone to your original title company and ran the numbers by them to verify your suspicion that the numbers were “padded.” 3. I realize that you had a lot of people watching you on this transaction and as a mentor there was a lot riding on this outcome. So far, I think you handled it well, although a little confrontational. (Although I can’t really disagree, because I honestly don’t think I would have acted much differently.) But for guys like you and me… killing with kindness might be better than calling them “bullies”, and inciting Brokers, saying the title company is trying to cheat you, etc. The last couple of deals I have negotiated I have been tried to get the opposing side on MY side by telling them how I “really appreciate all their help” and try to explain how I know it’s not them but the process… the sellers… whoever. But this is how I need it to go, or it just ain’t gonna happen. I try and explain that I don’t negotiate and this is a fair deal for all parties… take it or leave it. (All the while, I really am negotiating, but I have brought the conversation to a different level under my control). I look forward to your conclusion and how you turn THEIR WRONGS into YOUR RIGHT. Deals like this that go awry are not uncommon and I think that the lessons you learned can help investors make sure their deals go off better. Steven Boorstein Landlord Business Insider
    Steven Boorstein
    Replied over 11 years ago
    Interesting article. Lots of mistakes being made… Your article glaringly point out a couple of issues that I see… 1. Real estate agents often do not know what they are doing. The bull market from 1998 to 2005 infused a lot of new agents into the market. Many of them “part timers”. This and other factors, including the fact that in my state, for example, they do not have to have any continuing education and they are not considered fudiciaries but “salespeople” in the eyes of the law… has created an environment where it is a career that is easy to obtain a license in, has not ongoing educational requirements and has salespeople that can put themselves ahead of clients. Not a good combination at all. That’s not to say that a good agent isn’t useful. I think that there are agents out there whom I think add plenty of value to the transaction… but you have to be careful of the others. 2. In my state of NJ, for example, I understand it that most all of the costs associate with the Title/Settlement company are fixed. So, it is really service that becomes the major issue. I don’t know if it is the same in your state. I think I would have either approached the title company directly or gone to your original title company and ran the numbers by them to verify your suspicion that the numbers were “padded.” 3. I realize that you had a lot of people watching you on this transaction and as a mentor there was a lot riding on this outcome. So far, I think you handled it well, although a little confrontational. (Although I can’t really disagree, because I honestly don’t think I would have acted much differently.) But for guys like you and me… killing with kindness might be better than calling them “bullies”, and inciting Brokers, saying the title company is trying to cheat you, etc. The last couple of deals I have negotiated I have been tried to get the opposing side on MY side by telling them how I “really appreciate all their help” and try to explain how I know it’s not them but the process… the sellers… whoever. But this is how I need it to go, or it just ain’t gonna happen. I try and explain that I don’t negotiate and this is a fair deal for all parties… take it or leave it. (All the while, I really am negotiating, but I have brought the conversation to a different level under my control). I look forward to your conclusion and how you turn THEIR WRONGS into YOUR RIGHT. Deals like this that go awry are not uncommon and I think that the lessons you learned can help investors make sure their deals go off better. Steven Boorstein Landlord Business Insider
    Marcus Red
    Replied over 11 years ago
    GREAT article. So many people allow themselves to get sandbagged, its great to see you were able to stand up and get exactly what you really deserved!
    Rick Marnon, Howell
    Replied over 11 years ago
    Very few people can stand up for themselves. Kudos to you. I just want to know where your real estate agent was in all of this? Shouldn’t he/she have been taking care of all this. In Michigan the agent is the one to speak on your behalf. The part that involved the agent saying she would cancel the contract was a similar problem I had recently on a deal. It was a foreclosed home, and the offer accompanied a 22 page addendum from the bank that superceeded any contract that we would have written. Because of the length of the contract who better to speak to than the listing agent to make sure everything is filled out properly. We spent over 30 minutes making sure it was right. I then had to wait 2 weeks to find out that it was not, and she then calls me telling me that if this is not filled out right, and my clients don’t start doing what they are told she was going to cancel the deal and put the house back on the market. What a nightmare. I knew she couldn’t do it, but we didn’t have a bottom line from the bank yet. Do I get pissy with her and ultimately lose the deal for my clients? Fat chance, so I had to go old school with the way that I talked to her. All levels of arrogance had to be put aside. I went Dale Carnegie on her, and eventually she calmed down and realized that it was a minor mistake, so we corrected it and finally closed a short while after. Great post, and hopefully part II isn’t as bad.