Thursday, November 27, 2008

"Sly" Short Sale Buyer - A Cautionary Tale

My story takes place in Destin, Florida. I have modified parts ever so slightly to protect identities, but I write this as a cautionary tale for short sale listing agents and short sale sellers.

I received an offer on one of my Destin FL short sale listings. It was a well-done contract with a fair price- $270,000- just slightly low, but in the realm of "workable" for acceptance by the short sale lender, Chase. The selling agent said the buyer was a single school teacher, and he provided a pre-approval letter with the offer. My seller was excited and signed the purchase agreement right away.

The next day, while finalizing my short sale package, the seller called my office with potentially disturbing news. He said his neighbor mentioned to him at the mailbox, that she received an offer on her own identical floorplan short sale home- from the same agent on the very same day, from the same buyer, the "school teacher". The neighbor happened to be a real estate agent.

Concerned, I immediately called the buyer's agent. "Is this the same buyer? Does he really intend to buy two homes? Or is he playing games with my seller's time and my time, waiting to see which offer was accepted and a better deal from the respective short sale lenders? Would he use the ‘as is with right to inspect' clause as an out on buying the house he didn't want? Does he understand both of these properties had to go into ‘pending' status with our Board of Realtors?"
Very dismayed, I got uneasy answers from the buyer's agent. He said with a chuckle "Yes, he would buy both homes if both were accepted. (On a teacher's salary?) Oh, and don't you know, Wendy, that this is what you should do anyway, this will help you out to see what the bank will take. This is how short sales are done", he instructed me. I explained to him that both houses had to go under deposit per our board rules, and if the buyer was really playing games, there would be serious consequences for one of the sellers. I hung up the phone and called the neighbor, the real estate agent. She told me her suspicions were the same as mine, that the buyer was basically using each seller, and that she had unfortunately signed her offer, too. She was going to speak with her attorney. I called my seller, and he said he did not want to proceed with the contract unless the buyer decided "which home" he wanted, and to tell the agent to tear up the other contract, or he might have an ethics violation.

The analysis of this situation is indeed disturbing. The buyer has every right to make an offer on as many properties as he wishes to purchase. He also has a built-in "out" with the inspection clause, and can easily trump up an acceptable defect to nullify any contract. But, is his intent legal, if he cannot perform on all his contracts? This story has yet to be completed. When I left my last message with the selling agent, his voicemail said, "Thank you for calling Josh, your ‘honest' Realtor in Northwest Florida. God bless. "

It's Wendy!
Wendy Rulnick, Broker, CRP, CRS, GRI, ABR Rulnick Realty, Inc.

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Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204
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Wendy Rulnick specializes in real estate sales, short sales, traditional sales on Emerald Coast of Florida: Destin Florida real estate, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field. Wendy Rulnick, Broker and Realtor, has been selling real estate for almost 20 years. She has won numerous awards, including the coveted ADDY for advertising design. An expert marketer of real estate listings, she negotiates successfully to her dients' advantage. She is supported by a team of top buyer specialists. She lists and sells homes, condos and townhomes.

All Rights Reserved. *Sly Short Sale Buyer - A Cautionary Tale* Contact Wendy Rulnick regarding Destin Florida real estate and vicinity. Copyright © 2008 by Wendy Rulnick.
This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information

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