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Of Listing Agents and Langur Monkeys…
April 19, 2011, by Joy BakerOf Listing Agents and Langur Monkeys - Will Dealing Directly With The Listing Agent On A Foreclosure Property Really Give You A Leg Up Over Everyone Else?
I recently got a phone call from a buyer looking for information on a foreclosure property here in Southern New Hampshire. Our conversation was pretty short once I informed the buyer that I was not the listing agent (the property in question was actually not even listed by anyone in my office). This buyer only wanted to speak to “The Listing Agent”. This happens with a fair amount of frequency since many buyers out there seem to be under the impression that dealing directly with the listing agent will give them a leg up over any other buyer and allow them to purchase the property for “less”.
This apparently grows out of the school of thought that since Real Estate Agents are, at best, one step above Langur Monkeys on the food chain and most probably eat their own young; throwing out all legal and ethical obligations to his/her client if it means more money in their pocket would present no problem at all.
While I am sure there are some bad actors out there that would do that (every profession has them), most agents that I’ve run across will not; and for many reasons. So let’s take a minute or two here and look at why dealing with the listing agent directly is probably not going to give the buyer an unfair advantage over everyone else.
When an agent enters into a contract to list a property, they are agreeing to a set of LEGAL obligations, one of which is to put the best interest of the client ahead of anyone else’s interest, including their own. They have an obligation to obtain the best price for their client by fully exposing the property to the market. This means putting the property into MLS and cooperating with other agents who bring the buyer. So, on any given day there may be contracts coming in from any number of different agents on any given property. The listing agent is LEGALLY obligated to submit them all.
If it were discovered that a listing agent was giving unfair advantage to a particular contract because he/she would make more money…well, the doodoo would hit the proverbial fan. The agent would most assuredly lose that listing and any other listings from that client (if we are talking about an agent that does heavy REO listing, the loss of a single bank client can mean a huge loss in revenue). The agent could, and probably would, lose their real estate license.
Finally, the agent is now potentially open to lawsuits from either their wronged client or a buyer who feels they’ve been wronged because their contract was held back or not properly presented. All in all, it would be pretty foolish and short sighted of a listing agent to indulge in any hanky panky with a buyer who wants to buy one of their listings.
Does this mean you shouldn’t work with a listing agent? No, I’m not saying that. Some agents who only list a foreclosure here or there have the time to work with buyers and, although they will not give you an unfair advantage, they will certainly treat you fairly. The agents that list a large amount of foreclosures probably will not have time to work with you. Listing and maintaining their foreclosure inventory is their full time job. They will refer buyers to other agents in their office.
So, what should you, as a buyer, do? Find a knowledgeable agent that you like, that you trust, that you get a good vibe from and work with that agent. He/she will have access to the MLS and will know when new properties come on the market that seem to meet your criteria.
A knowledgeable agent will help you find a trustworthy and reliable lender to get your preapproval through (a critical first step), will help you to educate yourself as to what your dollar will buy in your market area, will review with you (ahead of time) the likely Addenda you will have to sign, and agree to, should you succeed in buying a bank owned property and will walk you through the entire process from offer through closing. This is a much more efficient way to find the best deal “for you” than running willy nilly from listing agent to listing agent.
For information about, and assistance with, purchasing foreclosures, short sales or (oh happy days!) non-distressed properties, contact me at 603-490-5344
