Was the Sellers Agent Ethical or not?

Pittsburgh, Pennsylvania
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Was the Sellers Agent Ethical or not?

Catherine R.
Member since 2022 · 15 posts · 0 votes

So we were under contract for a house. Our closing date got pushed. My realtor had us sign extensions and sent them to the sellers agent. I believe they signed one of them. But the closing date got pushed 2 more times and both times we signed and they got sent over to sellers agent.

However the agent never told the sellers and they never signed. Our loan ended up falling through and the sellers agent sent me a contact for a lady who works at a bank who is good at “rescuing loans” I called that lady and I also called Amerisave where a close friend is a LO.

Within one day I was in underwriting and moving quickly with Amerisave. The other lady took 2 days to call me back. She was moving very slow. I continue to work with my LO at Amerisave up until they ask for the extension for the purchase agreement. My realtor reached out to the sellers agent and the sellers agent said she would not pass on the extension to be signed UNLESS I used her contact at the other bank.. even though I felt that was unethical/illegal for someone to be telling me/strong arming me into using a lender I wasn’t comfortable with I still decided to try to go through her contact just to keep her happy.

Needless to say her contact continued to take a long time to get the process started and I ended up losing the house today because they took another offer. 

Mind you no termination has been signed. We have a contract it’s just out of date because she refused to send it to the sellers to sign unless we used her friend/loan officer. 

I am furious with my realtor for not staying on top of the sellers agent about past extensions being signed. And I feel wronged/violated by being forced to use a lender I wasn’t comfortable with. 

Is this legal? Do I have a right to be upset at both of them for screwing me out of my dream house?

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James Wise
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
4y
Quote from @James Wise:
Quote from @Catherine R.:
Quote from @Russell Brazil:
Quote from @Catherine R.:
Quote from @Russell Brazil:

You are in default of the contract. No one is forcing you to use their lender. They are giving you a second chance after you defaulted to save the deal. They could simply say no extension and move on to the next buyer, which is what I would have done.

By saying the only way we will sign an extension is if you use this bank is absolutely forcing me to use their lender… 


 No it's not. You are free to walk away and should be greatful they are giving you a second opportunity. You are completely ignoring the fact that you defaulted on the contract.

I should be grateful? Your mentality is gross. Have a good one. Thanks for the input!

He is correct. You should be grateful. You screwed the sale up, not the seller. The market is hot and you were given an olive branch by the seller and their agent. I presume the reason for this, was they knew that lender would shoot them straight on you. Seller was being prudent wanting a shaky buyer to work with a lender they were familiar with. 

At the end of the day, even with that lender they wanted to use, you still lost the house so it's fairly clear here that the issue is what both lenders discovered during underwriting you, your credit, income etc. So in reality, if said seller came on here and was all upset about a buyer who dragged them along for several months without ever closing on the house, most people would understand why they have a bone to pick with you, not the other way around.


Ditto on Rocket. As a seller if I have two offers that are identical, except for one using Rocket and another using a lender whom I know can get to the closing table, I ain't going with Rocket...........And folks, that ain't unethical. It's prudent. 
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  • Catherine R.
    OP
    Member since 2022 · 15 posts · 0 votes
    4y
    Quote from @Jay Hinrichs:
    Quote from @Bruce Woodruff:
    Quote from @Catherine R.:
    That would be nice....but did they do anything illegal?

    And it's true that it's YOUR money and you should be able to choose YOUR lender.....but it is THEIR house and they should be able to choose also....

    there are times when sellers wont accept a contract based on who the buyer is using for a lender..  I know for me on my new construction I will NOT sell to a client that is using Rocker OR Wells Fargo way to much brain drain as the builder/seller to deal with those institutions and I have that right.
    Rocket is terrible and I don’t blame you! We got roped into them originally any switched to a smaller local company which was also not a good move for us. Hoping Amerisave will get the job done once we find a new property. 
    0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    4y
    Quote from @Catherine R.:
    Quote from @Russell Brazil:
    Quote from @Catherine R.:
    Quote from @Russell Brazil:

    You are in default of the contract. No one is forcing you to use their lender. They are giving you a second chance after you defaulted to save the deal. They could simply say no extension and move on to the next buyer, which is what I would have done.

    By saying the only way we will sign an extension is if you use this bank is absolutely forcing me to use their lender… 


     No it's not. You are free to walk away and should be greatful they are giving you a second opportunity. You are completely ignoring the fact that you defaulted on the contract.

    I should be grateful? Your mentality is gross. Have a good one. Thanks for the input!

    He is correct. You should be grateful. You screwed the sale up, not the seller. The market is hot and you were given an olive branch by the seller and their agent. I presume the reason for this, was they knew that lender would shoot them straight on you. Seller was being prudent wanting a shaky buyer to work with a lender they were familiar with. 

    At the end of the day, even with that lender they wanted to use, you still lost the house so it's fairly clear here that the issue is what both lenders discovered during underwriting you, your credit, income etc. So in reality, if said seller came on here and was all upset about a buyer who dragged them along for several months without ever closing on the house, most people would understand why they have a bone to pick with you, not the other way around.

    4Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    4y
    Quote from @Michael Deering:

    Sorry to hear this happened.   The industry is going to consolidate soon and these bad actors will be flushed out.  Help your fellow buyers and file complaints against the realtors and leave some bad reviews.



    What exactly did this Realtor do that makes them a bad actor? Buyer couldn't get a loan and did not perform on their contract with the seller.

    Even though the buyer did not perform on their contract the seller and the seller's Agent gave the buyer a 2nd chance. The caveat to this 2nd chance that did not need to be given to the buyer was that the buyer had to use lender whom the seller trusts.

    Nothing in this scenario from the seller is nefarious. Some of ya'll are softer than charmin.


     
    4Reply
  • Joe S.Pro Member
    Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
    4y
    Quote from @Catherine R.:
    Quote from @Michael Deering:

    Sorry to hear this happened.   The industry is going to consolidate soon and these bad actors will be flushed out.  Help your fellow buyers and file complaints against the realtors and leave some bad reviews.



    That’s definitely the plan once I get my hand money back. It was a sh*tshow on both sides. Learned a lot though and I won’t give up on finding a good home for my family. 
    Thanks for responding!!

    I think the gentleman that told you to give bad reviews did so in terrible bad taste. Look those bad reviews you give can bite you too.  The sellers can answer it and make you look foolish as well. Not only that it’s stooping pretty low.. 

    3Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    4y
    Quote from @James Wise:
    Quote from @Catherine R.:
    Quote from @Russell Brazil:
    Quote from @Catherine R.:
    Quote from @Russell Brazil:

    You are in default of the contract. No one is forcing you to use their lender. They are giving you a second chance after you defaulted to save the deal. They could simply say no extension and move on to the next buyer, which is what I would have done.

    By saying the only way we will sign an extension is if you use this bank is absolutely forcing me to use their lender… 


     No it's not. You are free to walk away and should be greatful they are giving you a second opportunity. You are completely ignoring the fact that you defaulted on the contract.

    I should be grateful? Your mentality is gross. Have a good one. Thanks for the input!

    He is correct. You should be grateful. You screwed the sale up, not the seller. The market is hot and you were given an olive branch by the seller and their agent. I presume the reason for this, was they knew that lender would shoot them straight on you. Seller was being prudent wanting a shaky buyer to work with a lender they were familiar with. 

    At the end of the day, even with that lender they wanted to use, you still lost the house so it's fairly clear here that the issue is what both lenders discovered during underwriting you, your credit, income etc. So in reality, if said seller came on here and was all upset about a buyer who dragged them along for several months without ever closing on the house, most people would understand why they have a bone to pick with you, not the other way around.


    Ditto on Rocket. As a seller if I have two offers that are identical, except for one using Rocket and another using a lender whom I know can get to the closing table, I ain't going with Rocket...........And folks, that ain't unethical. It's prudent. 
    4Reply
  • Dustin P.
    Realtor · Tempe, AZ · Member since 2017 · 541 posts · 442 votes
    4y

    It sucks but like others have mentioned, the property didn't close because of you. You couldn't get your lender to come to the table and close on time as per the contract. I would have done the same thing as the seller and wanted you to use a legit lender the 2nd time around. They didn't have to give you another chance

    0Reply
  • Catherine R.
    OP
    Member since 2022 · 15 posts · 0 votes
    4y
    Quote from @Joe S.:
    Quote from @Catherine R.:
    Quote from @Michael Deering:

    Sorry to hear this happened.   The industry is going to consolidate soon and these bad actors will be flushed out.  Help your fellow buyers and file complaints against the realtors and leave some bad reviews.



    That’s definitely the plan once I get my hand money back. It was a sh*tshow on both sides. Learned a lot though and I won’t give up on finding a good home for my family. 
    Thanks for responding!!

    I think the gentleman that told you to give bad reviews did so in terrible bad taste. Look those bad reviews you give can bite you too.  The sellers can answer it and make you look foolish as well. Not only that it’s stooping pretty low.. 

    I don’t plan to say anything out of pocket. Just what happened to me. I don’t plan to slander them but I do think sharing how my experience was is important for others making an important choice. 
    0Reply
  • Catherine R.
    OP
    Member since 2022 · 15 posts · 0 votes
    4y
    Quote from @James Wise:
    Quote from @Catherine R.:
    Quote from @Russell Brazil:
    Quote from @Catherine R.:
    Quote from @Russell Brazil:

    You are in default of the contract. No one is forcing you to use their lender. They are giving you a second chance after you defaulted to save the deal. They could simply say no extension and move on to the next buyer, which is what I would have done.

    By saying the only way we will sign an extension is if you use this bank is absolutely forcing me to use their lender… 


     No it's not. You are free to walk away and should be greatful they are giving you a second opportunity. You are completely ignoring the fact that you defaulted on the contract.

    I should be grateful? Your mentality is gross. Have a good one. Thanks for the input!

    He is correct. You should be grateful. You screwed the sale up, not the seller. The market is hot and you were given an olive branch by the seller and their agent. I presume the reason for this, was they knew that lender would shoot them straight on you. Seller was being prudent wanting a shaky buyer to work with a lender they were familiar with. 

    At the end of the day, even with that lender they wanted to use, you still lost the house so it's fairly clear here that the issue is what both lenders discovered during underwriting you, your credit, income etc. So in reality, if said seller came on here and was all upset about a buyer who dragged them along for several months without ever closing on the house, most people would understand why they have a bone to pick with you, not the other way around.

    That’s not true. I was in process and in underwriting with both other banks. I’m not sure why everyone is assuming I don’t qualify. I wasn’t given an olive branch when they gave me 24 hours to get approved through an entirely new lender. We’re Ignoring the 3 extensions they didn’t sign. And my realtor didn’t tell me they didn’t sign them. So you can imagine my shock as i hear the house is on the market with my belongings inside of it. I was under the assumption I was under contract. So there’s more here than just “you don’t qualify, you wasted these peoples time” there’s issues on both ends. 
    0Reply
  • Catherine R.
    OP
    Member since 2022 · 15 posts · 0 votes
    4y
    Quote from @Dustin P.:

    It sucks but like others have mentioned, the property didn't close because of you. You couldn't get your lender to come to the table and close on time as per the contract. I would have done the same thing as the seller and wanted you to use a legit lender the 2nd time around. They didn't have to give you another chance

    And Amerisave isn’t a legit lender? That’s my issue. I had a good bank flying through the application process to get me this house. But they refused to let me continue with Amerisave and told me to talk to their connect which took days to hear back from. Days in which I was sending every document they needed to Amerisave until I was stopped by them refusing to sign the extension. I could have had this house. They blocked the process. That seems to be what everyone is missing. 
    0Reply
  • Dustin P.
    Realtor · Tempe, AZ · Member since 2017 · 541 posts · 442 votes
    4y
    Quote from @Catherine R.:
    Quote from @Dustin P.:

    It sucks but like others have mentioned, the property didn't close because of you. You couldn't get your lender to come to the table and close on time as per the contract. I would have done the same thing as the seller and wanted you to use a legit lender the 2nd time around. They didn't have to give you another chance

    And Amerisave isn’t a legit lender? That’s my issue. I had a good bank flying through the application process to get me this house. But they refused to let me continue with Amerisave and told me to talk to their connect which took days to hear back from. Days in which I was sending every document they needed to Amerisave until I was stopped by them refusing to sign the extension. I could have had this house. They blocked the process. That seems to be what everyone is missing. 

     The seller probably didn't think so. They wanted a lender who was going to shoot them straight on whether or not this loan was going to close or not. I don't think you're seeing that they were under no obligation at all to extend with you. They could have cured you the minute it didn't close per the contract and then went with a new buyer. Maybe you thought Amerisave was great but obviously the seller didn't see it the same way. They lost something too, they lost valuable days on market during a hot time.

    You could have had the house if you closed on time per the original contract, but you didn't.

    1Reply
  • Eric James
    Investor · Malakoff, TX · Member since 2017 · 2k+ posts · 2k+ votes
    4y

    Only possible ethical issue I see (if you have not mistakenly described the situation) is if the listing realtor refused to provide information to their client.

    0Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    4y
    Quote from @Catherine R.:
    Quote from @Dustin P.:

    It sucks but like others have mentioned, the property didn't close because of you. You couldn't get your lender to come to the table and close on time as per the contract. I would have done the same thing as the seller and wanted you to use a legit lender the 2nd time around. They didn't have to give you another chance

    And Amerisave isn’t a legit lender? That’s my issue. I had a good bank flying through the application process to get me this house. But they refused to let me continue with Amerisave and told me to talk to their connect which took days to hear back from. Days in which I was sending every document they needed to Amerisave until I was stopped by them refusing to sign the extension. I could have had this house. They blocked the process. That seems to be what everyone is missing. 
    Amerisave has a rating of 1.4 out of 5 stars on google.  Looks like you chose another hack lender. I knew that was likely to be the case when I looked them up based on their name alone.  The seller would be crazy to give you a 2nd chance if you are using another lender of the same caliber as the first. Why wouldnt you use a reputable lender after the 1st bad lender screwed everything up? From a seller's perspective this answer is easy, it appears like you dont qualify to buy the house.




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  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    4y
    Quote from @Catherine R.:
    You're learning about this business and the next deal you will be fine. Get a lender lined up and get pre-approved....
    0Reply
  • Rick Albert
    Real Estate Agent · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    4y

    The criteria for buying a property is simple: Income, Debt, Collateral, and Credit Score. Something didn't add up when you had to keep switching lenders.

    Regarding the listing agent "strong arming you" to use their lender, you could have used this to your advantage. As long as you close, they won't care what lender you use. You could have gone down the route of working with multiple lenders, including theirs and then deciding at the end who to use.

    I'm in Los Angeles so 99% of properties have fences, but I would imagine you could have just made the building of the fence and the other work as "conditions to qualify." This means you could have gone through the loan process and get a full loan approval with the only exception being these outstanding items. Then you do work to it.

    This appears to be a messy transaction from the start and the risks were not handled correctly. I don't think you have legal recourse because it sounds like you never would have gotten the loan. 

    I don't think the listing agent was intending to do anything unethical, it sounds like the agent wanted to get this closed and protect the Sellers. I would have said, "in order to get the extension, you need to get pre-approved by X lender with no obligation to use." Then when you didn't perform, I would cancel on you because there was a lender willing to do the loan (assuming you qualified) but you chose another route. Sellers want a buyer who is going to close, not string them along.

    My recommendation is speak with an attorney about the improvements so you know your rights, otherwise move on. Keep in mind this entire transaction sounded messy but you signed off the terms.

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