What to do When Your Seller Relists With a Realtor

Sometimes when you’re dealing with an expired, your Seller might relist with a realtor on a whim. When this happens, don’t panic—they almost always come back!

In the terms business, we often find ourselves dealing with expired listings. They’re a great source for lease purchase or owner financing deals—or even subject to deals, but that’s a different topic for a different article!—as the seller is usually at a point where they’re not sure if they will ever be able to sell their home. We’re able to make the seller happy with a purchase price that makes sense and a guaranteed timeframe while also making the buyer very happy by getting them into a house they otherwise would not be able to afford!

In this case, we’re looking at an expired listing that we started to negotiate with… It seemed like things were going well, but then the seller relisted the property with a realtor overnight.

This happens every now and then, and when it does, don’t panic! These sellers often come right back when their house doesn’t sell with their new realtor.

Let’s look at the details of this particular case and how we navigated a tricky situation to come out on top with three great Paydays-as usual.

The Colorado log cabin

From the first sentence of this post, you already know this property was an expired listing. In this case, one of our associates was dealing with a beautiful log cabin-style home in Colorado that was owned by a retired Navy Officer. He had built this home himself and planned on retiring in it, but as luck would have it, he met someone and moved across the country with them.

He was using the house for a few months out of the year, but eventually decided that it made more sense to sell it. So he listed it with a realtor...and it sat on the market for a year.

When the listing expired, one of our associates reached out to him with our expired dialing process. This system uses a series of automations to reach out to hundreds of potential leads and automatically leave voicemails. If they are interested in what we’re doing, they can contact us and go through a series of steps that will automatically qualify them so we only spend our time dealing with prospects who will be a good fit. It’s always great when you can speak with sellers that you know want to speak with you.

When our associate got in touch with the seller, he was interested in making a deal. We looked at the property, went back and forth with some numbers, and things were looking good…

Then, the very next day, we noticed it was listed with another realtor!

How to handle a sticky situation

This might seem like a terrible situation, but it really isn’t. As we always say, it’s important not to panic when things look like they’re going wrong (because most of the time it’s no big deal!).

If this ever happens to you, don’t get upset. If the house doesn’t sell, they’ll come right back to you. ...And in most cases, the house doesn't sell!

There is one thing you need to do in this situation, however. You need to get in touch with them and use a simple script we’ve developed to keep you in the back of their mind. Here’s what it sounds like…

You want to call them up and mention that you saw they've relisted with a realtor. Ask them, “How long are you tied up for?” The words “tied up” here are key, because they really are tied up when they’re working with a realtor.

Then you can say, “Okay, well listen—if you don’t get your full price in the timeframe you want, or if you cancel, give me a call.”

And that’s it! You can adjust this as you see fit, but using the words “tied up”, “full price”, and “timeframe you want” are key! This will stick in their mind, and as soon as they’re not happy with the realtor, they’re going to pick up the phone.

Now, you can probably imagine what happened next…

Months later, we followed up with the seller once more. We always routinely follow up with leads, and in this case, our associate simply left him a voicemail saying, “Hey, it looks like your home is still on the market. If you want to have another conversation about selling it, give me a call.”

Lo and behold, he called back the same day. He told us that he hadn’t heard from his realtor in three months and that he was ready to make a deal…

See? It pays off to keep in touch.

The numbers

So, we covered how to overcome the potentially sticky situation of a seller relisting with a realtor. Now let’s look at the numbers to see why this was absolutely worth the time we invested into this property.

The seller had listed the house for $499,000 with his realtor. The realtor had actually suggested that he drop the price to $449,000—so that’s what we purchased it for.

The seller also owned the house outright, so the monthly payments were principal only, which is key. The monthly payment was $1,590 and we estimated we could get a $2,200 monthly payment from a tenant buyer. This is over a 36-month term.

As of the time of this writing, this deal is closing this week and we’re quite happy with the results.

With that said, let’s get into the Paydays…

Payday #1 is, as always, the down payment. In this case, the intended buyer is going to put down $15,000 up-front and $10,000 by April 2020. They’ll put another $10,000 down by April 2021 to lower their payments on a future mortgage. Payday #1 then, is $35,000 down.

Payday #2 is the monthly spread. As mentioned above, our payment to the seller is $1,590 per month, which is all principal! We’re going to rent this for $2,200 per month, giving us a spread of $610 per month. Over 36 months, that’s $21,960.

Payday #3 is the final profit on the sale, plus the principal paydown. In this case, we’re going to sell the house $499,000, which is the original price that it was listed for. That gives us a profit of $15,000 after you remove the down payment.

But the best part is, of course, the principal paydown. That’s $1,590 per month over 36 months—which is a total of $57,240. Giving us a grand total of $82,240 for Payday #3.

When you add up all three paydays, you’re looking at $139,200 for a property that looked like it might not work out. If you ask me, that’s a pretty good return from a few phone calls.

Have you ever run into this issue when dealing with an expired? How’d it go? Did you stick with it? I’d love to hear about it.