House #12: Upping the Ante

January 11, 2010 · 8 comments

The Mini House has been under contract for 10 weeks now. We’ve repeatedly told the buyer’s agent that the mortgage broker was not on top of things, and that if she didn’t take control, this deal would never close. She has repeatedly said that she trusts the broker and that things are under control.

Well, as of 11am this past Friday morning (the day the contract expired), the buyer’s agent was still convinced we’d have the house closed by the end of the day. Of course, title hadn’t been pulled, HUD statements hadn’t bee prepared, the closing attorney didn’t have the loan package, and a closing hadn’t been scheduled, but apparently the buyer’s agent thought all those things were minor details that could be resolved in 5 hours… 🙂

We told the buyer’s agent that we were greatly annoyed that she didn’t stay on top of things and said that we were refusing the extend the contract; we were planning to keep the buyer’s $500 deposit and put the house back on the market. The agent was horrified; she said that it wasn’t the buyer’s fault that the house didn’t close, and that the buyer shouldn’t be penalized. I reminded her that it was actually HER fault the deal didn’t close, and said that she could explain to the buyer what happened.

The agent asked if there was anything we were willing to do to extend the contract another week. We told her that if the buyer would put up the rest of her downpayment as a non-refundable deposit (another $2400), that we would extend the contract for a week.

The agent refused and said, “I can’t ask the buyer to put up another $2400 when we’re not positive the deal is going to close.” I told her that I could completely understand that, but that had she done her job, this wouldn’t have been an issue. I also pointed out that we had had the property off the market for 10 weeks and were only getting $500 for all our lost time and costs, and that if she really wanted another extension, I wasn’t going to be the one taking the most financial risk.

Ultimately, we got the buyer to agree to put up another $1300 for a one week extension to the contract. They have until this Friday to close the deal, or we will keep the $1800 deposit and put the house back on the market.

We’re generally the nice ones when it comes to giving in to buyer requests; but after being screwed over and over by buyers who don’t really appreciate our niceness, it’s time to push back and ensure that we get compensated when our buyers can’t follow-through on their commitments.

8 responses to “House #12: Upping the Ante”

  1. Matt K says:

    Sometimes you gotta play hardball in order to get things done. My partner is awesome at doing this… especially when it comes to dealing with agents and buyers. You gotta push hard enough so everyone knows you mean business, but not to the point where you are pissing everyone off. This will usually result in a successful transaction with no hard feelings.

    Good Luck!!

  2. Steve says:

    Good man! I remember I had $10,000 of one of our buyers money non-refundable at risk and they brought it to the last day. The buyer’s agent got to my escrow ladies office at 8am (before it even opened) and sat in the lobby for 6 hours, to work as a runner and make sure everything requires gets signed.

    Now the agent will be motivated!

  3. Luis says:

    On the positive side this gives you assurance that the buyer wants to go through with this.

    I’m curious, have you tried to contact the agents broker and see if you can get any help there?

  4. Bilgefisher says:

    Well done. Its not a reputation as a hard ass so much as a reputation of sticking to deadlines set. You already have a reputation of keeping your promises. Word gets out that others must keep their promises with you, it will make things easier down the line. You may have just calibrated this agent for future buyers as well. That may not help you directly, but setting a higher standard for RE agents ultimately does help you in the long run.

  5. PR says:

    After reading your blog and a few others, it amazes me how many people, agents especially, don’t keep up on things. I am an agent, and have only closed late on one deal because of HUD. What also surprises me is the agent wasn’t willing to help at all, for instance putting up her own money to get this deal extended. I think you did the right thing by playing hardball.

  6. Chris Ranney says:

    Great job J.

  7. J Scott says:

    Luis –

    In general, if an agent is bad, there’s not much a broker a can do about it. The broker isn’t going to pick up the phone to call the mortgage broker, drive over to his office and plop down at his desk until the issue gets resolved, but ultimately that’s what needed to happen here…

  8. chris says:

    hi have you been looking for more houses to buy? how is the market now going into spring are finding better deals good luck with the mini houses that makes you mad the people want it but everyone else is falling down on the jobs. good luck

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