Real estate agents know it’s all about negotiation. Until it isn’t.
Last fall, a lovely family approached Wilmette, Illinois agent Lisa Finks of @properties to list their North Shore home. It had been on the market the previous year without success. They were understandably eager to sell and move on with their lives.
After about a month and dozens of showings, they received their first offer. “It was good on paper,” said Lisa. “There was no home sale or close contingency. They had solid preapproval, and it was a good price. So my sellers quickly accepted it.”
Lisa reminded them they still had several potential buyers circling and another likely offer was waiting in the wings. But her clients were still a bit nervous from their prior listing experience. They wanted to take the bird in the hand.
And now for the bait and switch.
The inspection and attorney review proceeded without incident. Then out of the blue about 3 weeks later, Lisa learned that buyers had switched lenders to a “family member” in the business.
“Wait… what?” thought Lisa.
She promptly called the new lender and spoke with him about the buyers’ situation. He assured her all was well and that the loan was a “slam dunk.” But that wasn’t quite the case.
“When we finally received a loan notice from this new lender,” Lisa remembered, “we learned that a condition of closing on their existing home — which wasn’t scheduled until the day before our own closing — was now added to the condition of their loan!”
The buyers had managed to sneak in a home close contingency by tying their mortgage, after the fact, to the closing of their existing home. Lisa’s hackles went up. “I was livid and my buyers were completely stressed.”
Did we mention Lisa is a lawyer, too?
Whatever you do, you don’t roll over
Lisa called buyer’s agent. He tried to argue there had always been a home close contingency as part of the offer. “I pointed out that first, he never verbally told me about such a contingency. Second, it was not in the written contract that he prepared and which his buyers signed. And third, it was not in the original preapproval letter they submitted.”
The agent played dumb. So Lisa spoke with her sellers’ attorney, who said there wasn’t much to do but acquiesce.
“I disagreed. Strongly,” said Lisa. “And I told my sellers to call the buyers’ bluff.”
After all, the original lender had preapproved them for a loan with no home close contingency. “So they had to be qualified,” Lisa reasoned, “and were just looking to insulate themselves from all risk in the transaction which their so-called ‘family’ lender generously offered to provide — at my sellers’ expense.”
A few days later, the clear to close was due. The buyers requested an extension, since they had not yet closed on their existing home. Lisa was ready.
“I insisted we deny the extension unless they met our conditions. They needed to assume some of the risk in the transaction by either waiving the mortgage contingency or making part of the earnest money hard in order to keep the condition.”
Lisa’s sellers listened. They pushed back on the buyers.
“And voilà!” Lisa announced. “Magically, the condition dropped off the loan and a clear to close appeared within hours!” Her sellers were thrilled with the outcome, and they peacefully awaited closing, which proceeded without issue.
Was Lisa’s law background what helped her defend her sellers so vigilantly?
No, she says.
“It helps, of course, but the very nature of being a real estate agent means that I have to go to bat for my client’s best interest at all times.”