Buyer's Agent Disappears After Buyer Signs Representation Agreement

Written by Posted On Thursday, 28 December 2006 16:00

Listings don't sell without buyers, but representing buyers, especially in an era when buyers can get listings online and contact listing agents directly, can be hard duty for some agents. They don't want their time wasted, and many are beginning to ask buyers to sign representation agreements. But are they doing the buyer any favors?

One first-time home buyer believed that signing a buyer representation agreement with his agent would mean that he'd have more of the agent's personal attention.

He was wrong.

Dear Realty Times:

I'm a first-time homebuyer and found some homes I wanted to see while shopping online. I contacted one of the listing agents to ask to see his listing, and he responded that he'd be happy to show me some properties. He also asked me to sign a buyer's representation agreement.

I thought agreements were between sellers and their agents, so this surprised me a bit, but he explained that he carves out time and expends resources for buyers as well as sellers and wants to work with serious buyers. I said okay. My agent showed me some houses the day I signed the agreement and I haven't heard from him since. I've emailed and called but no response. What was the point of asking me to sign an agreement if he was going to bail on me? Am I stuck with this guy? Dallas

Realty Times responds:

I feel personally embarrassed because you had written privately and I recommended that you sign the agreement so you could find a home quickly.

I'd like to contact the agent personally and give him a piece of my mind, but let's hold up on that until we have a little more information.

First, I assume that you've called and emailed this guy without receiving a response. If more than a couple of days has gone by, there's no excuse. Even if he's in a coma, someone should have taken over his business and let you know that there's a problem.

I don't buy the excuse "too busy to call" because you signed an agreement. That should have moved you to the top of the agent's priority list. While he may be involved with other clients, he should spare a few minutes to contact other clients.

As far as keeping you abreast of listings, again there's no excuse because even the most Internet-phobic agents can get on programs with their brokers that automatically drip information to their buyers. In other words, if you have an email, you should have been getting listing alerts. That's a no-brainer service that has been around for a decade and any buyer's agent should have access to it.

In my experience, when people don't call back, there are a number of reasons, but none are good for you. Often, they don't want to tell the truth - like they haven't been working on your house. Anticipating that you'll ask what the agent's done to find you a home, he won't call you back until he can justify to himself that he's done something on your behalf.

People also don't call back when you simply aren't a priority. So let's delve into that for a minute -- why aren't you a priority? It could be a lot of reasons.

What I suspect is that your "buyer's agent" isn't a buyer's agent at all, and probably still favors the listing side. My guess is that he's busy with his listing clients, and has shunted you aside, contract or no contract.

I'm not trying to transfer blame here, but relationships aren't one-sided, so let's try to imagine what's going on from the agent's point of view. Think back. Did you possibly say something during your outing with the agent that may have led the agent to think that you aren't a serious buyer or that you'll be more trouble than you're worth?

Here are some possible comments that may have turned the agent off:

"I don't care how long it takes. I'm only concerned about getting the best deal."

The best deal? How do you quantify that? No agent wants to waste months showing you homes without a timeline. They also don't want to show you all types of properties while you crunch the numbers. They want to show you homes, that you'll move into in the next six weeks or so. The more move-ready you are, the harder they will work for you.

Now imagine how differently things would be going if you had said instead, "My lease is up in a month, so I would like to find something right away. I want a good deal on a condo in the $120,000 price range, and here's where I'd like to be located."

The agent now has information he can sink his teeth into. He has a limited neighborhood to search, a price point, and a deadline. What could be better?

"If we find something I like, I plan to offer at least 20 percent less than the asking price."

That sounds pretty cocky. And where are you getting your information that homes are 20 percent overpriced? Wall Street? It may be a buyer's market, but that doesn't mean that sellers are going to generously hand over 20 percent to you. Home prices have softened, so sellers are already getting the message loud and clear. The ones who need to sell are pricing their homes more aggressively, so the chances of finding a home overpriced by that much is just about nil. Overpriced homes should stick out like a sore thumb, and chances are the seller is so unreasonable, they wouldn't take even 5 percent less. In fact, if your agent shows you comparables, you'll see that homes are already starting to absorb more quickly, which means that they're being priced to sell. What's going to happen is while you overconfidently offer 20 percent less, another buyer is going to come in much closer to asking price and get the house you wanted.

Again, imagine how much better things would be going if you had said instead, "I just want to see homes that you feel are fairly priced. I don't want to waste time in an unreasonable negotiation."

That would be music to the ears of any agent.

"I only want to spend $120,000, but I want you to find me a place in High Real Estate Hollow."

We'd all like to live in the most expensive part of town where home values are as solid as blue chip stocks, but a price point that wouldn't buy a garage in High Real Estate Hollow is simply unrealistic.

What if you'd said this instead? "I'd love to live near High Real Estate Hollow, but I realize that I can't have everything at my price point. Which neighborhoods come closest that I might afford?"

Now the Realtor gets to show his market knowledge and take pride in the fact that he found you a great deal in Middle Real Estate Hollow. He wants referrals, and when all your friends see your new place, he'll be in high cotton.

If you feel that you've had a failure to communicate and can get things back on track with a phone call, do so. Maybe the agent simply doesn't know what to do to move your transaction forward, and a little boost from you could get things rolling again.

On the other hand, if you feel you are not to blame for any misunderstanding, then call the agent's broker and ask for an appointment in person. When you get there, state your case and that you would like to be let out of your agreement because of lack of interest on your agent's part. Be sure you can document when and how you contacted your agent.

Any decent broker will let you out of your contract with a profuse apology, but keep in mind these are businesspeople. She may try to save the deal by suggesting you work with another agent. It's up to you to gracefully accept if you want. I'll bet the next agent won't make the same mistakes.

But don't you make any mistakes either. Be clear in what kind of home you want, where you want to live, how much you want to spend and when you want to move and there should be no further problems.

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Blanche Evans

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