Profile picture for LorrieWilkesDeringer

Is it unethical that our listing realtor sold our house to her cousin without revealing this?

  • July 23 2012 - US
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Answers (25)

Good agents know: Disclose, disclose, disclose, disclose..and when you've disclosed everything, disclose some more.  If familial relationships were not disclosed in writing, a call to the agents broker is in order. Sorry to hear of your trouble!
  • September 06
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Profile picture for jbautista082013
i forgot to mention that they stated having multiple offers over $800k with no contingencies. im curious how they can get the offer my sister provided for the seller to accept.
how is this possible when my sisters offer is the weakest with loan contingency be the one to be accepted by seller?
  • September 06
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Profile picture for jbautista082013
please help! i refered my sister to a listing agent to represent them in purchasing the house that their seller is listing so that they can have a better chance of getting the house. at the meeting the offer is 750k with 1% seller credit. 30 day close. they asked me for a copy of full credit report and paystubs which i thought was fishy because that had nothing to do with representing the buyer. an offer with a full lenders approval and bank statement should have been enough they stated so that they can present a strong offer. (i have never ever heard of such a thing) and right when i left my sister called me and told me that for them to get the house they have to do the loan as well which my broker is the loan agent. i know this is illegal and steering. what should i do? i dont feel right that they might be doing this to the ones that dont have the resource my sister has. oh and to top that they also wanted to be the listing agent / consultant for the sale of their condo which was was FSBO and my realtor who had a cash buyer client send an offer they wanted to negotiate with them and he gets 1% commission! the cash buyer is offering all cash at asking, what else can he negotiate when the condo is in litigation? my stomach feels sick knowing that there are agents like this to take advantage of people.

please help! what should i do?
  • September 06
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Profile picture for MBExclusive
Yes. This should have been disclosed, especially since it may have affected the price you received for your home.
  • August 03 2012
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In my opinion, yes it is. Realtors subscribe to a Code of Ethics that is above & beyond state law. Article 4 states, in part, that, "Realtors shall not acquire an interest in or buy or present offers from themselves, any member of their immediate families, their firms or any member thereof...." Even though a cousin may not be considered by all to be "immediate family", I always believe it is better to err on the side of disclosure vs. non-disclosure.
  • August 03 2012
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I believe it is and your Realtor should've disclosed this fact. Sounds like monkey business. How do you know that she even represented you fairly in this situation and didn't work harder on her cousin's behalf to get the better deal? Dual agency is always a tricky thing. I would seek the advice of your board.
  • August 01 2012
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Profile picture for SoCal Engr
Yes, it was unethical.
  • July 24 2012
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I would check your state laws.  I would personally disclose that because the buyer is not a disinterested third party.  It is not an arms length transaction in my book.  That's my opinion. 
  • July 24 2012
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We don't really know if this agent is a Realtor®, but there are at least a couple of good questions to have answers to before we let the dogs loose.

One is: did the listing agent act as a dual agent, or did they represent the seller in the transaction?

Another is: did the cousin have their own agent representing them?

Still another is: is there any evidence the cousin received preferential treatment from the listing agent?

  • July 24 2012
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Profile picture for emtjweber

Real Estate law and rules vary from State to State.  I would contact the board of realtors in your state and ask the question directly.   If you feel you weren't represented agressively enough because of a potential conflict of interest there could definately be an issue.  Did you suffer a loss because of your realtor's actions or inaction.  Ask to see the appraisal.   If you recieved a fair market value price for the property than you probably don't have a claim but if you sold for under market value to a relative of your agent and you were unaware of the relationship you might have a case.   I don't know ...check with the local board.

  • July 24 2012
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She wasn't obligated to do reveal that.Did she revealed some information to her cousin about your motivation for selling that you didn't want her to reveal? If so, you should be able to contact your local real estate board and/or state licensing board to file a complaint. If not, then congratulations on the sale!
  • July 24 2012
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Profile picture for SoCal Engr
I'm sure she would have disclosed this information, had she been aware of the familial relationship. However, the buyer did not inform the REA, and she was under no ethical obligation to discover the information on her own.
  • July 24 2012
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Profile picture for user5067347
In my opinion, the relationship should have been disclosed.  The listing Agent has a fiduciary responsibility to the homeowner.  Did the listing agent act in the best interests of the buyer or seller?  Disclose, disclose, disclose!!!
  • July 24 2012
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Profile picture for blue screen exile
The real question this produces is who established the asking price?  And did the agent talk the seller into accepting an even lower offer?

If the offering price was what the seller desired and selected, it appears that it was a "good thing" to have an agent that "brought a buyer" to accomplish a quick sale.  But if there was manipulation of the client for the amount being paid, that is an entirely different issue, which should be reported to the local board and to the State.

Were CMA's provided?  Were these checked against other estimates?  Were the CMA's reasonable, or did they perhaps look "manipulated"?
  • July 24 2012
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In response to my last comment, It was intended to be taken as facetious. By all means don't take that literally. :-) It's just a harsh meausure that we as community service providers should be aware of when doing a service anyone. My apologies if it came across as something I would suggest. Hmmm! Good luck!
  • July 24 2012
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Profile picture for LorrieWilkesDeringer
Thank you, everyone.  This is helpful.  Thank you for your insight and expertise!
  • July 24 2012
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Profile picture for Connie Klemme
you already have answers - I agree that while it is cousin does not qualify as immediate family it would have been best to disclose.   We can only assume from that point if it was intentional or mistake or something else.  If you're concerned there was wrong doing start with the broker then the local board.   

The reason I chimed in when you already have answers is this advice.
 I would put an ad in the paper With his name in Bold letters. Defamimg him.
I sincerely hope that you don't follow that advice.   That would accomplish nothing for you except significant heartache and possible lawsuit.   When there is a legitimate issue (sounds like you might have one) there is a LEGITIMATE process to follow- which more than likely was spelled out for you in both the listing agreement and the purchase agreement- where to go for mediation, complaints etc.  No need to put yourself at risk by not following a given process.  regardless if you think there was harm by this lack of disclosure or not- slandering or attacking someone else is unproductive and dangerous.  Best of luck to you, I hope that you find it was simply an ommission and that nothing was intentionally hidden and that your home was sold for fair market value.
  • July 24 2012
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   This Realtor in my opinion made a very big mistake. I would surely check with a REA and if necessary I would put an ad in the paper With his name in Bold letters. Defamimg him. That sounds harsh but, we are suposed to help people not take advantage. There is no way that deal could have been negotiated with the sole purpose of personnal gain. Definetly a dishonest Realtor I don't care what state this occurred in.

Nathan E. Wright/REI

As for the post itself, I initially read it as, him selling it to your your cousin. As opposed to her (The Realtors cousin)
  • July 24 2012
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In response to the "Realtors" Ethics quote. Its obviously referring to the Realtor not buying or selling to a member of his/her fam ily. But, whether it is or isn't ethical in legal platform! From a personal perspective its baaàaad busines especially if intentionally kept undisclosed. NOTE: I am not a Realtor I am.a Real Estate Investor- The rules are different but the morals should be in.parallel. Nathan E. Wright/REI
  • July 23 2012
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Profile picture for SoCal Engr
Article 4 of NAR's Code of Ethics states:

"REALTORS®shall not acquire an interest in or buy or present offers from themselves, any member of their immediate families, their firms or any member thereof, or any entities in which they have any ownership interest, any real property without making their true position known to the owner or the owner's agent or broker."

So, technically your REA has two (2) outs...

#1 - It was her "cousin", and not a member of her "immediate family".

#2 - Even if the buyer was an immediate family member, if your REA did not present the offer (i.e., was not the buy-side REA), then she may be "technically in the clear".

Of course, the appearance of potential bias (i.e., might the REA have given information to her cousin that was not in your best interest? did the REA advise you in a manner beneficial to her cousin?) should have been enough for a person with a working moral compass to have said something.

So, the REA is likely compliant with the letter of the code, if not the spirit. Of course, it's another story if it turns out the REA and her cousin have a joint business venture.
  • July 23 2012
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Profile picture for Ofe Polack
At what time was the relationship disclosed?  Was your listing agent, her cousin's buyer agent as well as your listing agent? 
  • July 23 2012
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Find out if the listing agent was also the buyers agent and then go from there. It may be time to consult your attorney.
  • July 23 2012
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Profile picture for Cindy Quinton
She sold the home to the agent's cousin, not the seller's cousin.

Unethical? Hard to say, since that is subjective in many cases. However, in some states it may bea violation of the law.

You could check with the real estate commission in your state. Or disclose the state here and maybe an agent could say.
  • July 23 2012
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Did they represent both buyer and seller and did they disclose this to you?

Ideally they should've disclosed their relationship to the buyer.

And if they represented both buyer and seller and failed to disclose this relationship, it goes beyond 'ethical' and falls into 'illegal' in some states.
  • July 23 2012
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Unethical, well I don't know if that would be the correct term. As Realtor the main concern usually is to get your home sold in a Ethical manner. Who it is sold to as long as the asking price was obtained, shouldn't matter. But, as for the buyer being your relative, the ethics issue would (I would think) be on your relatives. Were they not aware that the home they were purchasing yours. Not likely a secret to them as they either chose the house or were made aware of a listing of homes that fit their particular buying needs. So I guess to answer your question, NO!

Nate Wright REI

Note: Personally if I were aware that I was dealing with relatives, I would have brought it to the attention of both parties prior to proceeding.
  • July 23 2012
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