Profile picture for lucyand4more

Seller's agent got a verbal agreement to the sale and we aren't getting the house.

This morning I signed a contract on a home. At noon my agent received an email from the seller's agent saying we had the house. Later tonight another offer was made on the house. Logically, the seller's agent should have said the house was sold, right? Apparently, the agent did not physically go and get the contract signed. She got a verbal ok to the sale and told our agent we had the house. When the new offer came in she decided she needs to present both offers to the seller tomorrow. The new offer has to be better than our offer or she wouldn't be taking it to the seller. Has anyone had this happen? Our agent has tried to tell her that she's not behaving ethically and this has the potential for a lawsuit. Our agent is confident we will not get the house. What am I missing?
We have all of the papers signed and ernest money was given. The seller's agent said our contract wasn't signed. She never opened the attachment. Everything was signed and we have the time stamp to prove it. We also have her email saying our offer was accepted that was sent at noon. 
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November 08 2013 - US
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Answers (14)

So, how is this playing out?
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November 11 2013
I agree with many of the answers provided below... a synopsis answering your question is:

NO Contract/Agreement is "Legally Binding" unless ALL parties involved w/in the purchase/selling of the property have signed.  Electronic signatures are acceptable in most states in the US and other countries.  This is generally noted w/in the contract. One of the only exceptions is a "POA (Power of Attorney), allowing someone else designated to sign for a party involved in the agreement/contract. Verbal agreements should always be followed up w/ a legally binding agreement/contract.. ie signed.


Even though I am thoroughly exposed and knowledgeable of these types of situations, each state and any situation may differ.  I am not an attorney and would advise you to contact someone w/in the state (area) your purchasing.

If I can be of any further assistance let me know,
  Kevin
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November 10 2013
A fully executed is your proof that your offer was accepted. To have a fully executed contract, it must be signed not only by you, but also by the seller. Based on what you have written, there is no mention that the contract was signed by the seller, it was only signed by you, therefore, it seems your agent misspoke when she told you your offer was accepted. Diana
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November 10 2013
It is the Sellers Agent's responsibility to present all offers to their client. You are never considered Under Contract until you have that signed contract in your hand. Verbal means nothing even if the verbal response is emailed.
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November 10 2013
@Pasadenan
The only thing unethical is "your" agent telling you that "you got the house"...  your agent knows better; that no "verbal" is a binding contract in real estate.


The agent was duty bound to relay anything the sellers agent told them to the buyer.  I agree it should have been relayed with the caveat that "a verbal offer is not binding and we must have a signed contract".

I can't tell you the number of times this type of thing goes on.  From the buyers agent side - buyers are always hungry for news.  They will contact the agent 4 times a day - "any news"? - "Have you heard anything"?  "why is it taking so long"?.  You tell them what you have learned and they hear what they want to hear.

Not wanting to drive 20 minutes to get a signature is no excuse.  If the agent(s) don't utilize docusign they are working in the dark ages.  The seller can sign the contract in his PJ's.  I got a deal signed in a matter of hours with husband, wife and buyer all in different states. 

Once the buyers agent heard it was verbally accepted they should have insisted the selling agent forward it via docusign.  We all have it available to us IF we want to use it.  Not all agents want to utilize the technology we have today which is changing the way we do business.
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November 10 2013
Profile picture for Pasadenan
The only thing unethical is "your" agent telling you that "you got the house"...  your agent knows better; that no "verbal" is a binding contract in real estate.  Until it is signed by both parties, it is only "an offer".  Though the listing agent may have verbally told your agent that your offer was highly likely to be accepted, and your agent may have verbally told you the same thing, until it is "in writing", it is still only "an offer".  Without a signature, it is still "not accepted".

And you state your offer had no contingencies of any kind?   You were not planning on having a home inspection?  Your offer was not contingent on what you found in the inspection?  Most offers have some kind of contingencies, except for all cash, as-is offers, where the buyer already knows ahead of time what they intend to do for repairs/upgrades on the property.

But as far as your agent being "unethical"?  There is nothing in the NAR code of ethics that state they need to be 100% accurate in their verbal statements.  Sure, you could file a complaint with their local board, but nothing would come of it.  The NAR code of ethics is to protect the interests of members of NAR, not buyers nor sellers.

As far as "new carpet"?  "New" is a relative term.  To some people, it means "not used".  To others, it means less than 1 month old.  To others, it means up to 1 year old.  To others, it means bought within the past 5 years.  It certainly is not the "old" carpet that was removed.  If you don't ask, you have no clue what was "meant".

"Truth in advertising" laws may apply to used car dealerships, but they don't apply to private parties selling privately owned real estate, nor to agents attempting to represent private parties, especially when they use all kinds of disclaimers in their publications.
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November 09 2013
Previous responses have  addressed your concerns, so just a few comments

Let's start with this:

" Logically, the seller's agent should have said the house was sold, right?"

Wrong..............very wrong

Nothing was signed - a house isn't "sold" based on a verbal "yes".

As already mentioned, the listing agent works for the seller......seller is in the driver's seat.
Listing agent has a duty to encourage whatever offers may be out there.

This may not seem "fair", but it is business............and while I am not an attorney, I don't see any basis for a lawsuit.
Save your money unless you have a friend who is an attorney and won't charge you.

I understand you're frustrated and disappointed. It's unfortunate, though, that your agent didn't prepare you for what might lie ahead as these things DO happen.

Not sure what state you're in (wish zillow made it clear), but in NJ even AFTER the contract is signed by both the buyer and seller, there is a 3 day attorney review period during which time either party can cancel the deal.............. and yes, sellers can  kill the deal when/if they get a better offer.

Fair? No......... Legal? Yes......ethical? depends on one's point of view, but in these circumstances nothing that is actionable

I had a seller bounce back and forth between 2 offers before settling on the first one after those buyers were forced to increase their initial offer - even after thinking they "got" the house -   to compete with the 2nd offer.
As the saying goes - it ain't over till it's over............

Best wishes........





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November 09 2013
I'm sorry you are having such difficulties with your transaction.  I've been licensed and practiced in 3 states.  Every state I know of is the same.

There are no verbal agreements in Real Estate.  A seller can verbally accept an offer and 5 minutes later change their mind.  You do not have an agreement until the contract is signed by the seller AND the buyer has a copy in hand.

In PA if the buyer has not received the signed copy of the contract the deal can still be rescinded unless delivery has been effected.  

The listing agent did not do anything unethical if she/he is following the directions of the seller.  If the seller said "wait till tomorrow" then it's wait till tomorrow.  She can't force the seller to sign.  If the listing agent received a call that another agent that an offer was in the works - she is bound to tell the seller that.  If the seller wants to wait to see the second offer that is the sellers prerogative.

The sellers agent only owes a duty to the seller.  Not the buyer.  Your agent could have asked to present the offer personally to the seller and if it was acceptable - hand him a pen.  If your agent had made that effort to nail it down quick the situation might have been avoided.

I had two deals this week and our offers were presented to the listing agent and no other offers existed. Unbeknownst to me the listing agent was notified that another offer was coming in.  The listing agent is not bound to notify me.  We lost both deals.  In both instances I think the agents held the gate open for their friends to get an offer in.  One was an in house offer.  Can I do anything about it?  No.  

One of my offers even had an escalation addendum. In that instance the seller took an offer which was lower than our escalation would have been, because the seller thought that buyer made a higher initial offer and therefore was more worthy than my clients. Go figure.

We get up - brush ourselves off - and keep moving forward.

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November 09 2013
Profile picture for wetdawgs
I don't see a hint of "willful incompetence" in your description.  The listing agent is working for the sellers and the sellers also have rights.    If your agent doesn't recognize that the contract isn't accepted until there is a signature on the contract, your agent is not doing you any favors.

The seller has a right to review both offers even if you had been negotiating for three weeks, three months or three years.   It doesn't matter if you are offering all cash with no contingencies.   The seller still has the right to review all offers at their own pace.

Enjoy your visit with your attorney.
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November 08 2013
Profile picture for lucyand4more
If our agent had been told that the offer was accepted conditionally on the signature of the sellers, we could understand. There was nothing that said or implied that it was anything but a signed contract. We had no contingencies on our contract. We have funding in place and we do not need to sell a home before buying this one. 
The seller's agent did not want to make the 20 mile drive to get the contract signed today. My best guess is the other offer came in and she is caught in a trap of her own making. Maybe she saw the other offer is significantly better than ours or maybe she was pressured into making the offer. Either way she didn't do her job and she said she did. 
Maybe the seller's are more honorable than their agent. 
The agent also said in the advertising that the carpeting was new. It absolutely isn't new. There are red dye stains in one room and the other rooms have dirty carpeting. Tonight we found water damage so maybe it's for the best. However, we've been looking for a home for a long time and this is the first one that we can afford, at the right size, and in the right school district. It is a big deal to us.
I don't handle willful incompetence well. 
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November 08 2013
Profile picture for wetdawgs
Until your purchase offer has a signature or signatures from the seller on it, it is not a legal contract.       Until you see those signatures, acceptance isn't certain.     The listing agent may be responding to her client's wish to review both offers, which is certainly the seller's right.  While I can see it would be very irritating, the seller has that right.    Threatening a lawsuit at this stage may have made sure that the other offer wins (it sure would if I were the seller)  because you clearly aren't going to be buyer who is easy to deal with when other issues that come up.

If you are thinking of a lawsuit, spend some time and money with an attorney.   The time and money will be well spent.   Don't just swing the big stick thinking it will make everyone listen.



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November 08 2013
Your offer was accepted conditionally on the signature of the sellers and removal of any applicable contingencies. Unfortunately (for whatever reason) your offer didn't get the sellers signature. And the agent is now compelled to present the 2nd offer to the sellers.

Without knowing more, I can't say whether agent incompetence played a part in what happened. It's possible that the sellers were unavailable for signatures and the 2nd offer came in the mean time. But in the haste to make buyers happy, sometimes agents jump the gun.

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November 08 2013
Profile picture for lucyand4more
Thanks for your advice. We have been in negoiations for two days and had reached an agreement. Right now I'm feeling that a lawsuit may be our best recourse. Our agent agrees. We have conveyed to the other agent our legal concerns. Our agent has conveyed her legal concerns and the woman is still presenting both offers. 
I simply don't see how this could have happened unless it was gross negligence on the part of the seller's agent. Obviously, I'm not in the real estate business so I'm truly trying to figure this out. Our agent is as confused as we are.
She said she's never had this happen.
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November 08 2013
Unfortunately that happens, not to often thankfully,  Out side of your agent's strong remarks and maybe going to the managing broker it's a tough spot. You could think about what would your highest and best be and make amend your offer and see if you can beat out the other offer, it's gamble.  Good luck and hope it works out for you.  
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November 08 2013
 
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