listing agent upset about me (buyer) contacting the seller

5 Replies

Hello BP!! I am writing today in regards to a listing agent that got upset because I contacted the seller directly about their property. I apologize in advance for the long winded post, but I want to paint a clear picture.

The backstory goes as follows.... I was recently in escrow with the seller and I decided to cancel because of a few things that the seller was trying to change in our contract. This involved delivering the property with tenants in place at close of escrow (instead of it being vacant), and not paying for relocation fees. After consulting with the BP community, an attorney, and my agent, I decided that it would be best to walk away from the "deal."

From the time that we canceled escrow I've been thinking about how I could possibly make this deal work. The original idea was to move into 1 of the 3 units and use my VA loan in order to acquire the property. We canceled escrow mainly because the seller was not going to be able to perform as stated in the original contract, and given that the tenants weren't necessarily cooperating, we decided not to risk it. I've read a lot about seller carryback or "subject to" purchases and I decided to give it a shot.

I had previously spoken with the seller regarding the fact that HE wanted to cancel escrow because of what he had learned about rent control and relocation fees for his current tenants. I still had his number saved and I consulted with my agent (who is also a relative of mine) about whether there was a problem with me calling the seller regarding possibly doing a "subject to" transaction (I wanted to keep my agent in the loop and not overstep any boundaries). At this point there were no contracts in place and it had been about 2 weeks since we cancelled escrow. He had no problem with it and so I contacted the seller.

The text message I sent the seller goes as follows, "Good afternoon Joe (fake name). This is Antonio S. We recently cancelled escrow with you regarding the property on S.C. I am still interested in your property and I would like to ask you a couple questions. Please call me at your earliest convenience. Thank you for your time.

He called me shortly afterwards and we talked about possibly conducting a "subject to" transaction. He mentioned that he was more interested in a traditional sale and after speaking for about 20 minutes we left off with me wishing him luck on his sale and him saying that he will keep my offer in mind. It was a very polite and professional conversation. We left off on a good note.

A couple hrs later his agent writes a pretty nasty message to my agent saying to tell me to never call his seller again (he called me), and that the seller is very unhappy at this point, and that I should submit another offer if I'm still interest and follow the proper protocol.    

So, was I wrong for reaching out to the seller?

Is there a protocol that wasn't followed?

Might the agent be upset about possibly not making a commission on selling the house if it is a "subject to" transaction?

Might the seller actually be upset (very hard to believe given the conversation we had)?

I am just starting out in Real Estate Investing and I do not want to get off on a bad start.  

I want to text the seller back with an apology stating," I apologize for upsetting you during our conversation. Your agent made it clear that you are both very upset."

I truly feel that the agent is reacting this way because he wants to make the sale, but now the seller is inquiring about this other possible route. I almost feel like the listing agent is lying about the sellers reaction. If only you could've heard how polite and professional our conversation was you might understand why I feel this way.

Any help? Advise? Similar situations?

Thanks!!!

You were 100% wrong here. You violated a very understood standard of practice in the industry. I'd have your agent just reach out to the listing agent and apologize saying you didn't realize you shouldn't speak to the seller so there is no bad will in the future.

I also question the experience level of your agent/family member here. I can't imagine an experienced agent telling you this was ok. 

Thank you for the blunt and honest response. It is truly appreciated. 

Can you please clarify when it is ok to speak to the seller? I have listened to many podcasts and read many posts about contacting the owners of properties in order to find and acquire good deals.

When does it become a violation of a standard practice?

As an aspiring agent and investor, should I expect more lessons like this to occur via trial and error?

I am very motivated to learn everything I need to in order to pursue this career and investing path.

@Russell Brazil , I'm going to have to disagree with you a little bit. Can you imagine an average BP member, trying to explain 'subject to' to an average buyer's agent, who then has to explain it to an average listing agent, who then has to explain it to an average seller? Waste of time. Hell, I've refinanced 'subject to' deals simply because the borrower had spoken with dozens of lenders, and I was the first one that even knew WTF they were talking about. What are the odds that BOTH agents are in that "one in several dozen" category? Approximately zero point zero zero zero one seven percent, according to my HP-12C.

@Antonio Scerra , Russel is 100% correct above that this it's considered a big no-no to contact a seller directly, when they have a listing agent. So of course the listing agent is pissed, they think you are trying to steal their commission check (which is a stupid fear, that listing agreement still means the seller needs to pay that agent a commission, no matter the financing terms -- BTW did you include this very important fact in your conversation with the seller?). That being said, there's no point in talking to an average buyer's agent, average listing agent, or average lender for that matter, when you're trying to do a non-canonical transaction. 

Thank you for your input @Chris Mason . One thing I told the selller was that if he was interested in learning about subject to transactions, that I could gather up any information needed or he could  ask his agent about it. 

I think he asked his agent about it  and his agent felt.....threatened? I don't know. Just the agents response to our conversation didn't seem to make sense. 

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