Loved the house, hate the agent, do I have to use him?

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Submitted by lulu on November 30, 2006 - 12:50pm

A random agent we found showed us a home we absolutely love, but we don't really care for the agent. Because the agent showed us the property does that mean we are now bound to submitting an offer through him or can we ask the new agent we found to submit the offer for us?

Submitted by zeropointzero on November 30, 2006 - 1:34pm.

I don't think there is any "agency" relationship that is established through the act of showing a home. If you didn't sign any paper acknowledging him/her as your agent, I think you're fine.

Of course - you should let the new agent know the situation, and don't be suprised if you get a testy phone call from the other agent if he finds out.

Still - it's a little unfair to the first agent if he unearthed the house for you. Also - is this new agent a friend/acquaintance of some kind? If so - that's also a little unfair. But, I don't think there's anything keeping you from doing it from a contractual/legal standpoint.

Submitted by Nancy_s soothsayer on November 30, 2006 - 1:48pm.

lulu -- Karma will get you.

Submitted by poorgradstudent on November 30, 2006 - 1:54pm.

Good question.

"Don't really care for" is pretty vague. I've had co-workers I didn't really care for but had perfectly functioning professional relationships with. You couldn't have gotten me to go have a drink with them for less than say $1,000, but we were able to function at work.

On the other hand, there are people you just don't get along with at all. There's no reason you should feel obligated to pay someone so you have to be around them. I don't personally think you'd be out of line switching agents if your dislike of the first one is more of an extreme distaste rather than mild annoyance.

Submitted by PerryChase on November 30, 2006 - 2:20pm.

I wish that we had a hybrid system where sellers would show their own houses. For example, buyers could search for houses on site such as ziprealty.com. Once they find and view the house they love, they could contract with an agent so submit the offer.

I believe that buying a house is much easier than selling one, especially in a down market.

Submitted by lulu on November 30, 2006 - 2:25pm.

Thanks. I probably should have also mentioned that this is someone who called me when I hit that famous "schedule an appt. to see this house" link through a website with access to the mls. This agent has not done any footwork at all for us and simply opened the door for one home. For me to say I didn't care for the agent was probably an understatement. I don't think his rude attitude should entitle him to an 18k commission.

Submitted by zk on November 30, 2006 - 2:40pm.

Lulu,

Obviously you didn't sign any papers. So if you had any obligation to him it would be a moral one. But I'd say you don't have any obligation to him, not even a moral one. Buying a house is a gigantic financial transaction, and if you think his bad attitude (or other shortcomings) would get in the way of representing you as well as possible and cost you money (and I'd say there's a good chance they would), then find somebody else.

Sure, he showed you a house. But you didn't know then that he had a bad attitude. Now you know that. So if he asks you why you went with somebody else (which he may), then just tell him the truth.

Submitted by sdcellar on November 30, 2006 - 2:55pm.

lulu-- Sounds like maybe you went through ZipRealty. In that case, you may have some kind of agreement. I'd recommend that you look at their terms of service (that you probably agreed to when you signed up).

That said, I think you can probably get out of most agreements with a buyer's agent one way or another.

You say this guy was rude. That seems odd. Was there any chance you hinted at the fact you might not want to (or felt obligated to) use his services? I can't imagine an agent being downright rude since he's got a vested interested in continuing to work with you.

Submitted by kaycee on November 30, 2006 - 3:37pm.

You can always call the mangaer of that agents office, explain the situation and then ask to be reassigned to another agent in the office. That way, the first agent will still probably get a referral fee if you end up buying that house. But you wont ever have to see him again. You may want to look up the office and see if there is any other agent that you might want to work with based on experience, etc. Then you can have some names to give the manager and you won't get newbie. Then the manager will run interference and He/She will get the nasty phone call from the original agent. Not you.

Submitted by Nancy_s soothsayer on November 30, 2006 - 4:05pm.

I tend to believe that once you punched button called "schedule an appt. to see this house" and provided your name, contact number, etc., they already got you logged as client IN WRITING. Your phone conversation with the agent could also have been recorded. I'm not sure, but could they come after you?

Submitted by kaycee on November 30, 2006 - 4:44pm.

They wouldn't come "after" the buyer. The agent could go after the sellers broker and say that he showed the house, he deserves the commission. HE could then cut out the agent that the buyers actually used to write up the offer. It depends on the rules of the local board. When I was an agent the rules said that the person who originally showed the house got the commission. Then it was later changed to "whomever controlled the buyer". That is, whover submitted the offer to the sellers agent. Don't know what it is today. I lost a commission because my buyer had originally stopped into an open house and signed the "guest list'. She later decided to buy that house and I submitted the offer. The sellers agent submitted the signature on the guest list and used it to demand both sides of the commission. Our brokers eventually worked out a deal and I got a part of the commission but not the full one. They changed the rule the following year.

Submitted by lulu on November 30, 2006 - 5:33pm.

Thanks to all who gave me good advice.
Kind of sounds like Nancy_s is an agent.
Also, for those interested in knowing, just looked over the agreement when registering with Zip, you are not bound to use them.

Submitted by lulu on November 30, 2006 - 5:34pm.

I fully agree. My husband and I have actually been doing much of the footwork involved in finding a home ourselves. Many agents are so pushy these days, they can be worse than car salesmen.

Submitted by Mexico Resident on November 30, 2006 - 6:17pm.

This talk of contracts and obligations is ridiculous. Some of you are afraid that maybe indirectly through a website there might be some fine print somewhere? Give me a break! A house is a major investment. If your gut says someone is not working in your best interests, do not do business with that person. Even if you think you can ignore their advice it can get pretty strange if that person thinks they are the realtor controlling the client (as they often do). You need to think of yourself because YOU are spending the money and taking the responsibility. Do not let a salesperson control the situation. And I agree Nancy_s sounds like a realtor. She seems to be VERY concerned about the commission but doesn't care a bit about the person spending all the money.

Submitted by LookoutBelow on December 1, 2006 - 8:07am.

I agree with Mexico Resident....who cares what the agent thinks or feels ?  They ARE the same as a used car salesmen.

I certainly would not care what he thought if was getting ready to commit (foolishly in my eyes) to a million dollar mortgage, he'll be long gone by the time you figure out he wasnt working in your best interest.

Remember, he does NOT work for you, he works for the seller. You are HIS opponent, him and the SELLER are trying to make you spend as MUCH as possible. Keep things in perspective here.

Submitted by zeropointzero on December 1, 2006 - 8:18am.

Agency issues aside, Lulu ..... are you concerned about buying a house in this market environment? Care to share some other details on the potential purchase? (feel free to keep some details out, so no one else gets your dream home).

Just curious. Good luck in any event.

Submitted by lulu on December 1, 2006 - 10:41am.

Actually, we're very concerned about buying in this market. We're newly married and this would be a first home for both of us so we realize we may be a little bit eager. We also have a dilemma in the mix of having to move to the area we're looking in quite soon for school district purposes. So we've been weighing the pros and cons of buying or renting. Most people renting their homes understandably want a 1 year commitment though. We don't like the idea of putting a home purchase on hold for that long though since the market is quite unpredictable right now. Greenspan says the worst is over, other economists say its just begining!! We're planning on spending 600k-620k, we're only submitting offers on homes that are below their comps for quick for a quick sell. Any opinions out ther on how bad buying now in this price range may affect us long term? If we're buying 25k-35k below comps. how in the red do you think we'll really end up being by this time next year??

Submitted by sdcellar on December 1, 2006 - 11:28am.

I think the real thing to consider is what it would cost you to rent a comparable home. For the price range you've said you're looking at, I'm guessing you could rent the same thing for around $2000 a month ($2500 tops).

It is tough to predict what's going to happen to home prices, but it's pretty unlikely that they're going to start going up again any time soon, so that means they'll be flat or declining. That latter makes renting the easy decision, but even if prices stay flat, you probably come out ahead "throwing away money" on rent rather than doing the same thing on interest, property taxes, insurance and upkeep. The only part that's an investment is the principal you pay and that can easily be devoured if the decline continues.

Submitted by FormerSanDiegan on December 1, 2006 - 11:39am.

Lulu - "Most people renting their homes understandably want a 1 year commitment though. "

Suppose you leave your rental 6 months early. That'll cost you about $12,000 MAX. And that's only if the landlord does not fill the unit with another tenant. If you break a lease you are liable only until the landlord fills the unit with a new tenant. As a landlord, I think that most will gladly get you in their rental now (slow time of year) adn allow you to break the lease in the early summer (peak season for filling rentals,) no problem. The wost case penalty for breaking the lease is only about 2% of the price range you are looking at.

Another option is to offer a hundred bucks or so extra per month for a month-to-month lease. Even if the rentals are advertised with minimum 1-year leases, you can offer 6-months and more money or month-to-month. Some landlords will go for it. Everything is negotiable. Also, FB's who have pulled their home off the market and panning to re-list in the spring will gladly give you a month-to-month lease.

Submitted by poorgradstudent on December 1, 2006 - 12:38pm.

Even if (and it's a pretty big if) the worst is over nationally in terms of housing, SoCal still has a ways to fall, since the bubble was bigger here than nationally due to more speculation.

That said, if you love the house and the price is right, it's worth considering. But now is not the time to stretch your finances just to buy.

Submitted by PerryChase on December 1, 2006 - 12:43pm.

Lulu, when you say that you hate to put-off buying a house for that long (1 year), you're acting on emotions. One year is NOT long.

Since you're newly married, you probably have some notions of a perfect marriage that includes homeownership.

Try to think cold-hard cash and make your decision based on how much you'd save (for your family's future) if you rented. If you're prepared to pay $3500 in interest, property taxes and HOA each month, you can rent a much nicer house in a nicer neighborhood for the same amount.

Submitted by powayseller on December 4, 2006 - 7:12pm.

I was waiting for one of our realtors to answer this question, but they didn't, so I will do so.

Unless you signed a contract for an agent to represent you as your buyer's agent, you can switch agents at any time. This is something that realtors probably don't want you to know about. Imagine the disappointment of a realtor who showed you 40 homes, just to lose your sale to another agent you picked up along the way.

Of course, if one agent has worked with you, it's only ethical that you give him the business of the sale, in my opinion.

Beware also of low fee agents who cut costs by not taking you to showings. They try to tell you that you don't need to be shown any homes. "Just look at them over the internet" is convenient for the agent, but doesn't give you any idea about what the homes truly look like. Make sure your agent takes the time to show you lots and lots of homes, maybe 50-100. Only then will you know a good deal when you spot it.

Submitted by sdrealtor on December 4, 2006 - 9:03pm.

Nice advice but not necessarily right. There is something known as procurring cause. It's pretty complex and a challenge to prove or get compensated for but nonetheless it exists.

Submitted by SD Realtor on December 4, 2006 - 11:04pm.

Hi Lulu -

I am an agent as is sdrealtor. He is right about procurring cause however it does not sound as if they would come after you in this particular case. (that is just my opinion) Similar to a listing agreement (signed between a seller and an agent) when a seller is listing a home to sell, there is a buyer broker representation agreement that does obligate a buyer to be represented by a broker. If you have not signed such a document, then it is unlikely that representation would be challenged, IMO.

On the personal side I am renting right now. The 1 year lease goes by VERY quickly. Consider that the risk of the market appreciating 1 year from now verses depreciating 1 year from now is pretty low. (At least that is my hope) Also if you have downpayment money stick it in a cd for a year and grab 5% on it. So if I were you I would not fret much about waiting.

If you do have an agent who has done work for you then "the ethical" thing to do is to work with that agent. However if you have clicked on a schedule an appt or gone to open houses and talked to agents who were holding the open house, you are definitely not obligated, especially if you did not sign any agreement for representation. As a courtesy though you may want to tell them that you are already working with someone, (and that you very much appreciate thier time to show) if you do not intend to work with them.

I have spent many weekends with clients only to get scorched by mortgage brokers or other agents. It is part of the business. While we are considered fairly useless by most on this forum, many of us are helpful and can very much help people save time, money and find/sell thier home.

SD Realtor

Submitted by powayseller on December 5, 2006 - 11:14am.

Thanks for the procuring cause comment, although I wish someone would have explained what it is. A quick review yields this:

"The Procuring Cause Guidelines C.A.R. and SDAR adopted in the late fall of 2001 address how to determine which of the brokers involved in a transaction is responsible for its successful completion, and therefore entitled to the commission."

Procuring cause is an uninterrupted sequence of events that results in a sale. If a realtor feels a buyer unfairly deserted him by purchasing a house via a different agent, the realtor has the burden of proof that he is entitled to the commission.

A list of Factors was developed to help decide these disputes.

The following are in favor of the 1st realtor, the one who was deserted:
* he showed the property which was purchased
* the new realtor never showed that property
* the realtor spent a lot of time generating more buyer interest in that property, discussing financing, etc.

Favoring the new realtor are these factors:
* the 1st realtor is the listing agent, and the buyer wants separate representation (in my opinion, NEVER ever let the listing agent represent you - it's a clear conflict of interest, regardless of what the realtors tell you; they'd rather get the double commission than look out for the buyer's best interests!)
* buyer is dissatisfied with the 1st realtor for lack of professional conduct

Read more

Submitted by sdrealtor on December 5, 2006 - 12:55pm.

Good research! It is a very gray area and tough to prove as I mentioned early. Nonetheless it does exist.

Submitted by kiki on December 5, 2006 - 9:07pm.

What about Zip realty terms and conditions:

"Client" is a User that has completed the registration process and has agreed to these Terms of Use.

Section 3. Client Agreements and Representations. ZipRealty Clients agree to the following:

3.4 Client agrees that he or she will not contact the owner/seller of any property from information gained through the website. The Client will not attempt to enter the property or speak with an owner/seller without an appointment set by ZipRealty.

It is assuming that you HAVE to use them to set up an appointment. IF you register and agree will that bind you? That is why i have not registered.

I guess you can still set an appointment and still do not use them. Although that is really wasting their time. Technically, loggin in to their site and not planning to use them to purchase is also waste of their resources. They are not like Zillow that clearly is a free service.

What do you think?

Submitted by SD Realtor on December 6, 2006 - 1:02am.

Just my opinion Kiki but I do not believe that Zip would chase it down in court.

Like I said, I think many a Realtor has stories about buyers who have scorched them. It is just part of the business. Many seasoned agents will not even waste time showing homes unless they have a buyers representation agreement signed to remedy this.

SD Realtor

Submitted by SD Realtor on December 6, 2006 - 1:03am.

Just my opinion Kiki but I do not believe that Zip would chase it down in court.

Like I said, I think many a Realtor has stories about buyers who have scorched them. It is just part of the business. Many seasoned agents will not even waste time showing homes unless they have a buyers representation agreement signed to remedy this.

SD Realtor

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