Shady Agent or is it just me?

Shady Agent or is it just me?

Pittsburgh · Member since 2019 · 3 posts · 3 votes

While out riding around the neighborhood I wanted to invest in I ran into an open house and met with the agent. The house was overpriced (she even said it that day) I decided to try and network, she was nice enough to give me her time a couple days later in which we sat for about 2 hours talking about my plans in real estate and how she could help. A few days later she showed me some properties that i asked to see and then she told me about a listing that she had. We went to see it, a 2/1 house that was "turn-key". It was listed for $39,900 but her listing paperwork from BH said it was valued at $28,000 and Zillows Zestimate was $40k. I offered $20k and we ended up at $25k. I was excited, ready to have my first real investment property. I am new to this so i messed everything up, I somewhat read and signed the documents (in which she included a contract between her and I that i didn't notice until afterwards, i thought it was for this unit) and deposited the earnest money before i was supposed to. the sale was contingent on a satisfactory inspection. After i had deposited the money she sent me the disclosures that she "had just received from the seller", leak in the roof, leak in the basement and "other areas". I was bummed about this because she had not mentioned any of this beforehand. I was able to pull the offer before the inspection because the seller had not signed the agreed upon offer. After further thought and talking to the seller I was told that the leak in the roof is a small one that can be fixed and the one in the basement is because of the door, not the walls. i figure I'd give it another shot because rents in this area are between $650-900 for a 2/1, 960 sqft. and if the inspection shows that this is correct it could probably be fixed for a reasonable amount. I re-submitted my offer but she said she was not going to submit it until the next day or so because she is supposed to be getting another offer in that night. In the meantime i requested a showing of another house that was already occupied and was about the same price but listed with someone else. Overall i just feel like she is in control instead of myself or the seller. She "snuck" in that contract with the documentation of the offer, she held on to my offer and the lingo in the new offer says i have like a week or so to get the inspection done which is difficult because the ones i spoke are busy, even the ones she sent me. Am i being paranoid or should i just move on? i like the potential of the property but not the feeling i get from the agent.

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Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
7y

At those price points you should expect lots of problems eith the property.

And nothing sounds shady, you just sound paranoid.

See this reply in the discussion

29 Replies

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  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    7y

    I don’t see anything shady, but....no reason for her to not resubmit your even if another is coming in.....seller’s often consider two offers at the same time.  There was no reason for you to knee jerk cancel your original offer, since you still had an inspection contingency.....you should have just got the property under contract, then renegotiated during your inspection period if you wanted to....maybe this is why she’s hesitant to resubmit your offer.

  • Real Estate Agent · Salt Lake City, UT · Member since 2018 · 247 posts · 247 votes
    7y

    It’s common for seller disclosures not to be shared until a formal offer has been submitted. That’s why you have your inspection period. What is the “contract” you said she had you sign? To me it sounds like it’s most likely a duel agency agreement, or something where you acknowledge that she represents the seller and you are representing yourself. 

  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    7y

    At those price points you should expect lots of problems eith the property.

    And nothing sounds shady, you just sound paranoid.

  • Rental Property Investor · Concord, GA · Member since 2015 · 3k+ posts · 3k+ votes
    7y
    Read everything before you sign anything.
  • Pittsburgh · Member since 2019 · 3 posts · 3 votes
    7y

    Thanks for the replies. Cason Acor, I found out afterwards it was a contract stating that she represents me as a buyer until December, so whatever I decide im buying until then has to go through her. I asked about it the next time we met. I should have read it better before signing or I wish she would have said that it was in there when she sent me all the other stuff. But again, I only see myself buying 1 property between now and then. Thanks again for the feedback. I will learn as I go. 

  • Rental Property Investor · Katy, TX · Member since 2013 · 417 posts · 171 votes
    7y

    @Ruben Vega Sounds to me like she may have violated here duty to submit offers to her seller-clients upon receipt, if that is in fact the what the RE commission in your state requires agents to do. That is what the Texas RE Commission requires of agents...That is also unless her seller-client specified to her to hold offers for some reason(s). On the Buyer Rep agreement, that sounds like bad business practice for her to slip that in the package of to-be-signed documents without mentioning the fact that it would extend to any property you buy through December. Are you sure that it applies to any property that you buy through December? Or perhaps just one specific property or neighborhood instead? If you speak to her (or her sponsoring broker if she has one) about it, she may let you out of the Buyer Rep or amend it in an effort to not muddy her business reputation.

  • Rental Property Investor · Katy, TX · Member since 2013 · 417 posts · 171 votes
    7y

    @Ruben Vega Also forgot to mention, if she (or her brokerage) represented the sellers of the home that she was holding the open house for , and if she did explicitly mention to you that the house was overpriced, then she at the very least is doing a great disservice to her seller-clients by not promoting their best interests and negotiating position. Again, I’m speaking from the perspective of a different state’s standards, but if all of this is plainly accurate then she seems to me to either be an incompetent, poor, or somewhat “shady” at least, agent and I would try to not do business with her representing me as her client at any point, now or in the future.

  • Real Estate Broker · Northeast PA · Member since 2017 · 2k+ posts · 2k+ votes
    7y

    Caveat Emptor.  Sneaking in an exclusive right to represent is a NO NO to me.  Professional brokers should disclose their assets off, especially with an obvious newbie.  But that's based only on your side of the issues.  Oh well, next.

  • Greg H.Pro Member
    Moderator
    Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes
    7y
    Originally posted by @Jordan Decuir:

    @Ruben Vega Sounds to me like she may have violated here duty to submit offers to her seller-clients upon receipt, if that is in fact the what the RE commission in your state requires agents to do. That is what the Texas RE Commission requires of agents...That is also unless her seller-client specified to her to hold offers for some reason(s). On the Buyer Rep agreement, that sounds like bad business practice for her to slip that in the package of to-be-signed documents without mentioning the fact that it would extend to any property you buy through December. Are you sure that it applies to any property that you buy through December? Or perhaps just one specific property or neighborhood instead? If you speak to her (or her sponsoring broker if she has one) about it, she may let you out of the Buyer Rep or amend it in an effort to not muddy her business reputation.

    There is absolutely no duty to submit offers upon receipt. In fact, I would argue that not waiting for the other offer to come might not be in the best interest of the seller as a multiple offer situation might benefit them

    I have no idea regarding Pennsylvania law as to whether she was acting as a duel agent or some sort of intermediary. Texas does not allow a duel agent however an agent can act An intermediary 

  • Rental Property Investor · Katy, TX · Member since 2013 · 417 posts · 171 votes
    7y

    @Greg H. Of course the seller(s) waiting to see the other offer coming in probably would be in their best interest. But that's not up to the agent to decide for the sellers unless they have been instructed to do so. I wasn't speaking from a bargaining-position standpoint. I was coming from the perspective that her/his state's RE Commission, state's association of Realtors, the National Association of Realtors, or even his local MLS board may require (in some form) that the agent not withhold offers because he/she is "waiting for another offer". I am sure that either TREC, TAR, NAR, or perhaps even HARMLS would disagree with you. And they are the ones that set the rules locally.

  • Greg H.Pro Member
    Moderator
    Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes
    7y

    @Jordan Decuir

    There is no requirement to immediately submit an offer or even submit them in order. I would probably send an email/text/vm to the seller stating that there is an offer but we are expecting another tomorrow and we can get together then.While I get that investors want their low ball offers answered first, I would do what is in the interest of my client and in this situation it would be to wait. So what if the agent is on vacation and can’t be reached for days?

    You realize the MLS is not an enforcement body right ? Reality is NAR and TaR are not either

  • Member since 2019 · 21 posts · 5 votes
    7y

    I wouldn't put much stock into anything coming from Zillow estimates. Nothing can estimate better than a local agent. 

  • Real Estate Agent · Princeton, NJ · Member since 2016 · 1k+ posts · 1k+ votes
    7y

    @Ruben Vega - from what you've said, you're inexperienced and don't know what you're doing (YET). As an agent selling a house, of course we're going to help you write up your offer to buy the house. Your inspection tells you what's leaking/damaged and then you go to seller to renegotiate price (if it's not already reasonably factored in) or walk away. When you call and ask agent to pull your offer before the inspection, I would think wow this guy is pretty high maintenance and really unsure of himself and what he's getting into (because houses with problems have cheap prices). Then I think: I DOUBT HE WILL CLOSE and I'd better find another buyer (for this property anyway). Then I'd think I'll put him on a property alert email and try to get him as a buyer on another property, maybe at a higher price / rent ready / in better condition. Truly, I don't know if you own a personal residence or any other rental property, but you haven't made it clear you understand how to comp an ARV, anticipate/estimate repairs, and determine mao (your Max offer to make the profit you want).

  • Real Estate Agent · Philadelphia, PA · Member since 2013 · 451 posts · 369 votes
    7y

    Just going to throw this out there, usually the agents representing extremely low price point properties like this are the most likely to act shady or unethical. The best agents typically aren't touching that price point as their time is too valuable for the money to be made.

    Get yourself an agent that represents you. If the first thing they tell you is that one of their listings would work best for you, that is a red flag, as this usually means that their primary goal is getting both sides of the commission at the detriment of (at least one of) their clients.

  • Specialist · Northeast Ohio · Member since 2018 · 12 posts · 11 votes
    7y

    @Ruben Vega You should have 7-10 days to schedule your property inspection. Get that completed and review the inspection report and speak with your inspector before you sign off on the final paperwork. And let the agent know that is how you want to handle it.

  • Pittsburgh · Member since 2019 · 3 posts · 3 votes
    7y

    I greatly appreciate all the replies. I didn't expect this much feedback but I'm glad I did get it. I will definitely take everything into consideration and read everything coming my way. I will get better at this. Thanks again for the help. 

  • Real Estate Agent · Scottsdale, AZ · Member since 2011 · 471 posts · 296 votes
    7y

    @Ruben Vega

    Run don't walk!!!

    Find yourself an agent who is also an investor.

    Good luck Ruben! ;)

  • Lender · Wildwood Crest, NJ · Member since 2017 · 317 posts · 56 votes
    7y

    @Ruben Vega due diligence is key in this industry. That is one of the best ways to protect your business assets.

  • Bernadeau C.Pro Member
    Rental Property Investor · Orlando, FL · Member since 2014 · 540 posts · 230 votes
    7y

    @Ruben Vega if you don't feel comfortable with the agent then it's okay to find an agent that you really connect with, especially someone with an investor mindset. Remember the agent works for you, not the other way around.

  • Mike CumbieBusiness Member
    REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes
    7y

    Personally I think you need to find a buyers agent. You are trying to use the sellers agent because you think you will get a deal. You will get nothing but headaches if you do not know your local contracts, customs and values doing it that way.

    Just my 2 cents and good luck! 

  • Matthew DennehyPro Member
    Concord, NH · Member since 2016 · 86 posts · 82 votes
    7y

    It definitely sounds like you’re not getting the right representation. As an investor, you should always expect surprises with the property, but not from an agent that supposedly represents you.

    Material defects with the property should be disclosed right away. Also, you should be made aware of any document binding you into an agreement. Agents have gotten into trouble for not explaining their agency agreements, which typically don’t hold up in court as a result.

    If you aren’t getting what you need up front from the agent, do yourself a favor and get someone interested in your best interests.

  • Real Estate Agent · Gainesville, FL · Member since 2019 · 63 posts · 52 votes
    7y

    In my state, seller's disclosures are usually right on the listing in the MLS so I always take a peek at them when vetting a property for a customer. I would advise them not to make an offer till we get them (they are required in this state but sometimes it doesn't happen bc the seller refuses) but if it's a rehab project that is in obviously terrible shape, we already sort of know what they're getting into. The extent of it will be discovered on inspection.

    Next time ask for the disclosures before you make an offer. Here I have seen major items such as leaking pools and foundation problems so as an agent I can inform my buyers of what I know and they can make an informed choice. Anything less is unethical IMO.

    Never go to the listing agent bc that person works for the seller and already has a relationship. The agency relationship can be changed if the parties agree so the agent then represents the transaction instead of one side or the other. But it sounds like this agent is jerking you around and I do feel there is way too much shady business going on. Unless instructed to do so, an agent is legally required to present all offers in a timely fashion. Makes no difference if there is another offer expected to come in, time is of the essence (in my state) and having two offers on the table at once is a great thing for sellers.

    Personally unless you are hard pressed to find other deals, I would walk away from this one and also from this agent. Read the contract you signed word for word and figure out how you can fire her. THEN (and only then) find yourself an investor-friendly buyer’s agent who represents YOU.

  • Property Manager · Raleigh, NC · Member since 2014 · 728 posts · 596 votes
    7y

    @Ruben Vega

    did you sign the contract? if so, did you read the contract? sounds like it was probably your mistake by not doing your due diligence before signing. I have worked with agents and signed similar documents.

    as for the house, why would you cancel contact before having professionals inspect issues? how do you bhut a 30k property without expecting issues?

    after all that, all is not lost. you just received some of the best instruction in real estate. by making these mistakes now, you will be much better prepared in the future. no more signing without reading, no more freaking out when getting bad news. continue learning and you will one day be a real estate invester.

  • Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
    7y

    @Ruben Vega The agent didn't do anything shady here. We see this a lot where newer investors automatically jump to "the agent is shady" rather than looking at themselves and thinking "maybe because of inexperience, i misplayed this scenario". 

    Inexperience is not a bad thing by the way, it is just a part of the process. Every investor has a moment like this early in their career where they will look back and say "gees, I was in over my head". If this deal does not work out for you there will be others. 

    Also, just in general people tend to look at the lower end price points in a given market and think that their risk is less because the purchase price is less. That is not always the case, these lower end properties have their own significant challenges that come with them. There are several articles and forum posts in this very topic here on BP if you are interested in learning more. 

  • Member since 2019 · 45 posts · 19 votes
    7y

    @Ruben Vega

    Hi Ruben!

    Real estate transactions can be EXTREMELY complex. As a result, Your realtor has a legal obligation to always represent your best interest in the contract as she is the “real estate expert!” If she does not do this, you can fire your realtor and/or report her to the local realtor board for complaints. 

    It’s also important that you read and understand EVERYTHING you are signing in a real estate transaction and don’t be afraid to ask questions!! 

    From the facts you presented, the realtor didn’t seem shady but maybe a little unorganized and having a lot of clients that she may or may not be able to manage effectively. Don’t be afraid to be 100% honest with your realtor and let her know your concerns! You can flat out ask her why she didn’t explain a certain contract page to you. 

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