Profile picture for chimeynangchen

When is the buyer's agent and their brokerage at fault?

Another issue that points to our buyer's agent is that I was concerned that the house was overpriced when we looked at it. Our agent's response was "Don't worry, you will have to have an appraisal done and that will be your insurance that you don't pay too much for the home" When the appraisal came in too low for the seller, she changed her tune texting me (and I still have the text for evidence "You need to come up with $17,000.00 to honor the contract" as though the low appraisal was my fault!

Can I seek some retribution or at least a sanction against the realtor throught Weichert, her brokerage?
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January 09 - Hackettstown
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Answers (4)

Profile picture for SoCal Engr
a consumer's perspective...

Okay, you're not happy. The house did not appraise at your offer. You listened to some bad advice. Based on that advice, you made a bad decision.

You were already concerned that the house was overpriced, but you allowed yourself to believe that the appraisal would be a "magic parachute". Yes, appraisal contingencies in your offer provide you some protection from being stuck in a transaction. But, the cold hard fact (which you are now way too familiar with) is that this "protection" is after you've already spent money on things like inspections and appraisals.

When all-is-said-and-done, REAs are salespeople. Not a judgment, just a fact. REAs make a living when you spend money, when a transaction actually closes. Just like any other people, some REAs are more/less ethical than others, some REAs are more/less capable than others, etc.

This is why it is important for consumers to own their transaction. Everyone else (the REA, the mortgage pro) are advisors and facilitators. You've learned an important, if somewhat costly, lesson. It could have been much worse. Hopefully, it won't be one that you'll have to go through again.

If it makes you feel better, provide negative, but factual, reviews for the REA. Warn your friends. Write a letter to the broker, or to the broker's franchise board.

But, most important, put this lesson in your hip pocket and move on. Don't let this, or attempts to "get retribution", drag you down any longer than need be.

Good luck on your next offer...
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January 09
Sure, go ahead.

I do not think that an appraisal is mean to be "insurance that you don't pay too much for the home." It is solely meant to evaluate the property on behalf of the bank. 

I understand that you expended a good deal of cash attempting to purchase this property only to find out that the lender would not provide you the funds, based on the appraisal. That would even be true if the agent's market analysis justified your bid price, by the way.

- Next time a similar issue comes up, ask the agent to include a clause that says the seller will pay for the appraisal and other expenses incurred if you cannot come to agreement in the event of a low appraisal.

No, don't do that! This actually makes a contingent sale look good to a seller by comparison!
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January 09
Profile picture for hpvanc
I doubt there is anything you can do, they are pretty well protected from litigation and sanctions for making misleading statements to get the deal closed by state real estate authority regulations. Unfortunately you seem to have found a typical salesperson to act as your buying representative, and if you have signed a "buyer's" agency contract with them may be stuck with them for the duration on the contract. At this point you need a different agent, so if you have a signed agency agreement ask the agent to terminate it. If the agent won't terminate the agreement, perhaps you should wait until after the contract expires to resume your search.

Next time a similar issue comes up, ask the agent to include a clause that says the seller will pay for the appraisal and other expenses incurred if you cannot come to agreement in the event of a low appraisal. The seller doesn't have to accept the clause and may well not, but doesn't mean you can't try in situations where you are bidding at the high end of potential market value. I did it and the seller did accept it.
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January 09
Profile picture for wetdawgs
You are welcome to write reviews about the agent all over the internet.    Keep them factual to avoid being accused of libel.

Other retribution, see your attorney.
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January 09
 
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