Need Advise Please!

10 Replies

You all helped me last year in assisting my disabled son to purchase his first home. You helped through the purchase, the rehab, and the renting of it.

My husbands health issues [as well as my own] has forced an earlier retirement of our business [by about 2 years] than we had anticipated. We were already planning to move to Pueblo to start an Autistic community, but this pushed it up a bit,

Our building is going to be purchased with cash in a few weeks by a friend of ours. Another friend[ who we borrowed the money for our business from in the first place] has some official form pledging to pay for the homes we purchase in the case that the closing takes place before we receive money for the business and building.

Okay, so I started looking at listings and saw a place that looked good. I called the same realtor who had helped with my sons purchase. Our realtor put in an offer for us. Their realtor put in a counter offer. We went to look at the house [ I know, but they go that fast here] I saw the house and told the realtor that we were not going to accept their offer because there was no backyard, and because the smell o cat urine was so strong  and I did no know how to get rid of it.

Came  home, and said to myself, but there are many of us [Autistic people] who cannot tolerate the outdoors and that house would be perfect for them. But the smell. So, I did research online on how to get rid of the stench[house needs new floors anyway] which I had confirmed by the sages of house renovation [ Home Depot employees] and,the next morning called the realtor and told him that we had changed our minds.

The realtor said that since we had not immediately jumped on then deal that then other realtor had been angry and wanted further proof of finances. I then called the  owners and told them that we still wanted the house at the agreed upon price if it was still available. The owners were super nice and excited that we were not your usual rental investors. It had been his grandmas house for 40 years before they had bought it after she died. We had an instant connection and they said that they knew that we were the people God wanted them to sell to.

So, the next day we get a phone call from our realtor. He said that my conversations with the sellers were extrememly illegal[ we did not make any changes at all in the contract, we just got along] I told him that there were messages from the sellers and h told me that Iwouldbe in big legal trouble if I returned the phone calls. So I did not.

So, we put in further proof of our finances, and signed and sent the contract.

3 days later, as I am packing [we had all agreed on a closing date the end of september] we get a text saying that they accepted another offer. We asked why we had not been given achance to outbid, and he said that I was lucky that I was not charged for illegal contact. [Colorado]

so wasthere a lack of ethics somewhere? Was Iillegal? Were the sellers who called me many more times than I called them, though I initiated, also illegal [ we were not making any changes] 

and, should we trust the realtor?

@Vicki Gleitz What an intense story. I'm assuming that the home you were buying was under contract, and you out a deposit on the home? I'm not 100% sure about Colorado but it seems to me like THEY breached the contract. As for you, it seems like you did not illegal (I'm not an attorney.) I would contact your agents broker and figure out what happened and why, and consider legal actions.

I'm curious as to what law your realtor is referring to when they say your actions are illegal. Out of place yes, but not illegal to my understanding. Is it illegal for him to contact the seller directly, yes.  You on the other hand technically are allowed to. Someone correct me if I'm wrong here. 

Dan Mackin, Real Estate Agent in CO (#FA.100056958)
720-971-7139

Ask them how God will feel about them not listening to him. Guess you'll find out how religious they really are..

Originally posted by @Nick Britton :

@Vicki Gleitz What an intense story. I'm assuming that the home you were buying was under contract, and you out a deposit on the home? I'm not 100% sure about Colorado but it seems to me like THEY breached the contract. As for you, it seems like you did not illegal (I'm not an attorney.) I would contact your agents broker and figure out what happened and why, and consider legal actions.

One thing I found strange was that when we signed the agreement, there was NO mention of earnest money. We asked our realtor, and were told that would come later. I had never heard of such a thing.

these houses go fast. we are considering a different realtor for a house just a few houses down from my sons house. can someone from Colorado please tell me if I was illegal [and he said the word in a tone that I had commited murder] 

Here is the line he is likely referring to.

 Buyer agrees to conduct all negotiations for the Property only through Broker and to refer to Broker all communications received in any form from real estate brokers, prospective sellers, or any other source during the Term of this Buyer Listing Contract.

The legality is technically there in the contract for them to be your buyers broker. If you didn't sign that then there is no legal obligation.

Dan Mackin, Real Estate Agent in CO (#FA.100056958)
720-971-7139

"he told me that Iwould be in big legal trouble if I returned the phone calls. So I did not."

Your realtor lied, lied badly.  You did absolutely nothing wrong. 

This realtor should be reported to the Colorado Department of Regulatory Agencies, Division of Real Estate: https://www.colorado.gov/pacific/dora/division-rea...

Ideally, this Realtor should never work in this industry again.  I have rarely seen misbehavior by a Realtor this bad.

Originally posted by @Dan Mackin :

Here is the line he is likely referring to.

 Buyer agrees to conduct all negotiations for the Property only through Broker and to refer to Broker all communications received in any form from real estate brokers, prospective sellers, or any other source during the Term of this Buyer Listing Contract.

The legality is technically there in the contract for them to be your buyers broker. If you didn't sign that then there is no legal obligation.

 Okay, I just skimmed the "Contract to buy and sell real estate" that we signed. I could have missed this in there, but if not, that is the only contract we signed. Nothing else

@Vicki Gleitz did you sign a buyers' agency with the agent representing you? If so, this is what he is probably referring to. It's item 9 in the standard Exclusive Right to Buy contract (the contract between you and the Broker). It reads as follows:

9. BUYER’S OBLIGATIONS TO BROKER. Buyer agrees to conduct all negotiations for the Property only through Broker and to refer to Broker all communications received in any form from real estate brokers, prospective sellers, or any other source during the Term of this Buyer Listing Contract. Buyer represents that Buyer Is Is Not currently a party to any agreement with any other broker to represent or assist Buyer in the location or Purchase of Property.

If they didn't have you sign that agreement then you are not bound by that clause. It is not a "law". If you signed it, you broke your civil contract with the agent. I don't know what the penalty for that is. Obviously, one is you now have a mad agent. BTW a lot buyer's agents don't have their buyers sign these until closing which is NOT what the real estate commission wants.

There is a similar clause in the contract between the sellers and their agent which the sellers clearly violated by talking to you. They should have told you, "Call my agent." I'm sure their agent wasn't too happy about them talking to you. Again not too sure what the "penalty" is for breaking their civil contract with the sellers' agent. 

These clauses are in the contracts to keep communication straight and to make sure that a back room deal is not cut that short changes the agents their commissions. 

So I would say the term "illegal" is a bit strong but you certainly went out of bounds of conventionality. The expectation is that if you use and agent, you don't go outside of that relationship to get a deal. The idea being if they spend time and money (gas is not free) meeting and showing property to you then they are providing a service to you for which they expect to be paid for if you find a property. The service they provide goes beyond the writing of contracts and filling in forms it goes to the knowledge they impart to you while you are "shopping". That knowledge is part of what brings value to the table. While you may think that you didn't gain anything from them, you did use their time. Since agents gave you time, the custom is that you pay them if you buy. Now you are not bound by that but you should know that a lot of agents will feel you are bound. If you don't follow that custom there will be social ramifications (agents won't work with you).

If you want to continue working with the broker, go fall on your sword and say we didn't mean to step on any toes but since we hadn't signed an agreement with you we didn't know how things were supposed to go. We won't do it again. 

If you don't care. There are lots of agents. Find a new one. Remember Pueblo isn't all that large of a community. There are probably less than 20 brokers that make a full time living from real estate there. If you make one of the big dogs mad it could have long term ramifications.

I would primarily agree with @Bill S. here, but this is not "illegal" in the sense of police officers showing up at your doorstep. If you signed the Buyers Agreement then you are technically in violation of the contract. In reality most decent agents would just tell you that it is not customary for the buyers and sellers to talk directly because it can cause confusion when the agent is out of the loop. And generally if you violate the terms of the contract, unless their is a specific penalty laid out it just means the contract can be voided by the agent. Of course if you did sign one and you purchase any house within the timeframe specified in the contract, then you owe that realtor their commission. But I would say that to me this seems to be a very unprofessional approach on the part of the agent to, in essence, try and intimidate you into remaining silent when you established a connection with the sellers that could have benefitted you. I would not personally want to work with an agent like that but I don't know about the agent situation in Pueblo and will defer to Bill S. and others on that point.

@Bill S. - "go fall on your sword and say we didn't mean to step on any toes but since we hadn't signed an agreement with you"

I must completely and totally disagree with your perspective on this scenario.  According to OP, the buyer's agent said "I would be in big legal trouble" and "he said that I was lucky that I was not **charged** for illegal contact." [emphasis added.]

This is threatening criminal prosecution for a civil contract matter, when there wasn't even a contract in place! 

This is illegal extortion. 

The buyer's agent should no longer be a Realtor(TM).  And I look forward to helping OP make sure that happens.

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