When we look at what is happening the last few weeks in our industry, what is the number one concern? If
you were going to make an offer on a home to purchase it, what would be the one thing you would focus on?
- The financing
In the last three weeks I have received four of the worst contracts I have seen fired off by agents to my sellers.
The contracts were missing:
- A pre-approval or even a pre-qualification letter from a lender.
- Signatures stating they have an earnest money check.
- Signatures from their brokers stating that they reviewed the offers.
- Signature from the agent on the lead based paint addendums.
- Three did not have a cooperating broker's agreement. (I guess they did not want to get paid).
- Two of the contracts were marked N/A for special provisions and then had special provisions typed in.
- Two were expired before they even transmitted them and one gave my out of state client ½ a day to respond.
All of these agents must have attended or missed the same contract writing class.
With the lending industry going through their difficult times and real estate markets going through changes; it is not time for amateurs. If you do not know what you are doing, team up with someone who does or take up another occupation. I hear there are shortages in the hair cutting and fast food industries.
OK, I apologize for venting.
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Randy L. Prothero, REALTOR®, ABR, AHWD, CRS, e-PRO, GRI, SFR
Century 21 Liberty Homes
Randy Prothero is well established as an expert in working with military / VA clients and first time home buyers. His home seller's (listing) campaign is one of the most aggressive marketing programs in the area.
Based out of Mililani, Hawaii. Randy services the island of Oahu (Honolulu County) and the Leeward Regional Chairman of the Honolulu Board of Realtors. To improve overall professionalism in his area Randy also offers classes for real estate agents.
www.HawaiiRandy.com * Oahu (Honolulu County) Property Search * Hawaii Military Relocations
Now Have a Blessed Day,
John Occhi, Hemet CA REALTOR®
Mission Grove Realty
My favorite one these days (and we're seeing LOTS of this) is ZERO down, and x amount ($100 OR $250) UPON ACCEPTANCE. No money with the contract! Hello... what does that mean? An agent (she's the MOM of the buyer) submitted such a contract to me the other week.
$55000 house, with $100 UPON ACCEPTANCE and no preapproval letter. Nothing. When I insist on money before signing, she gives me $100 written on her own account (daughter forgot her check book, the n she says daughter cannot FIND the check book) 3 days after handing in the contract.
Then when I request $400 additional dollars within 14 days, she balks. I ask for $200 in 14 days... she balks. She says if I don't trust her daughter (who's supposedly preapproved with her company's inhouse mortgage guy... yet no proof in writing) then forget it. She'll find another house. I ask for the pre qual letter & she replies that she needs another week to get the daughter's numbers up. Ha! No deal.
How can buyer's agents even propose such deals, with the problems we're having getting loans? Any seller's agent has got to be cautious.
Many are looking for real jobs as we blog...
This business needs to rid itself of incompetents that give the rest a bad name.
Sally - I am not sorry for what I said, just that I was venting here.
John - that will be a Christmas present for unsuspecting consumers.
Joe - That is the truth.
Nicole - The problem is they will probably be replaced by someone just as bad.
Sue - Our market is much stronger than most. Being on an island we have a supply and demand issue that is not going away soon.
Laurie - Three of the offers were for properties in the $Million range. Absolutely scary!
Erica - Was that $55,000 or $550,000. I didn't know there were homes in that price range anywhere. Either way, you were smart to press the other agent.
Vicki - You must be kidding. It was not a licensed agent was it?
Armando -We used to call incompetence of others "job security".
Hey Randy, feel free to vent anytime. :) The last offer presented on one of my listings....the agent had never written one so he had the buyer write it up. Wow.
I feel your pain my friend.
Randy - Where are the manager's and brokers? I've seen some horrible contracts lately, too, and on top of that, I can't even get the listing agent on the phone to ask them what they meant. Some of the things I've seen in special provisions is a whole other post!
I was wondering why you have been quiet on AR lately...now I know where you've been...trying to train all these agents!
Stephanie - Many years ago, my brother was presented an offer on one of his properties. I was formerly licensed at the time and looked over the offer with him. It was full of mistakes. (This was when our contracts were much simpilar). His agent who was representing both sides wanted me to re-write it for him.
It was not going to happen. I told him to get his broker involved; which angered him, but got it fixed.
Stephanie - Many years ago, my brother was presented an offer on one of his properties. I was formerly licensed at the time and looked over the offer with him. It was full of mistakes. (This was when our contracts were much simpler). His agent who was representing both sides wanted me to re-write it for him.
It was not going to happen. I told him to get his broker involved; which angered him, but got it fixed.
Linda - I have been so busy that I haven't had time to be on Active Rain as much. Hopefully I will get caught up a little with my new assistant coming on board later this week.
The brokers are also part of the problem, they are not overseeing the agents.
Randy,
It is even better when the Broker writes it and you have to give up after a half dozen attempts to get it right.
Randy,
I would like to comment on: "The brokers are also part of the problem, they are not overseeing the agents."
I have been seeing some terrible contracts lately from some of our agents. After reviewing one I was so shocked I highlighted all the errors, printed it, and drove 3 hours to go over it with the agent that wrote it. I spent the whole day doing contracts and counters. Ok, so far so good.
Then yesterday I was reviewing another one, and lo and behold almost the same mistakes........I told the agent that she needed to go back to class and learn as obviously my teaching wasn't getting through. I also told her no more contracts are to go anywhere before I see them first......and this agent has been in the business for 23 years.
I already have a formal letter written, and a ban on any dual agency until and such time as this agent completes a Formal Contract class.....
Sometimes I wish I was still an agent :)
Randy... it just makes you wonder if they are lazy, lack common sense, or just don't know what they are doing. Yes, it's sad no matter what the answer is. Because each answer as a solution. Keep venting to make others aware of this.
This is all pretty much part and parcel of the current market climate. Like many say here in this comment trail, lets hope a lot of this kind of work falls by the wayside, and those that don't aspire to excellence along with it.
Just saw a comment you made on something of Nima's and agree with you. We just posted a different take on the mortgage climate and think we pretty much solved it. Or maybe not.
No need to apologize for stating the obvious. We recently read something of Lenn's about someone who worked for her that is a Lazy Boy salesman now. That wasn't venting either. And you are right on... it is no time for amateurs.
Randy, I am in the PA coal region! I usually sell high end homes, and have sold the 2 largest sales ever in my town ($425,000 and $435,000). And maybe the smallest: I did a row home for $5000 a few years ago. That's not a typo.
The $55,000 was for 2 houses! Twin homes being sold together in St. Clair, PA. It's my market. Average home sale county wide is approaching $100,000 ... we're almost there!
We have $10,000 homes in the northern part of the area, and $300-500,000+ in the southern part. We sell a lot more in the low end than the high end.
Needless to say, when an agent here says she's a multi-million dollar producer, that's hot stuff.
Mike - That is really bad.
Kathy - I guess years in the business do not guarantee quality work. I find that as I get older I have less patience with that kind of stuff.
Jeff B. - I see similar problems in every industry. Because of the value of our products, it is even more critical that those involved are professional at every level.
Thesa - Thank you
Gary - Absolutely, this is the time for professionals and the others need to get out of the way.
Sybill - I see the same thing with the pre-approval letters. I just had a transaction where the lender said they verified the funds; to later find the buyers did not have their cash.
Chris - I think that if ever office mad a policy of missing docs or missing signatures, no commission check. Most of these problems would go away.
Erica - That is a lot of work to be a Million Dollar producer. Here in Hawaii that is between one to three sales depending on if you are doing entry level condos.
Gary - I am always concerned that if we go into escrow with an agent that starts like that, where will this transaction be heading? Almost ever one that fell out of escrow started that way.
Lysa - I still look for professionals when I get my hair cut.
Tony - If not, possibly we can offer an hourly rate to walk them through the process. :)
Randy, I'm moving to your neighborhood.
Ha!
Randy...
Hold on to your boot straps.
This is going to get worse before it gets better but deep down you know that :)
My educated guess is that is will take a year to weed it all out.
Be glad you haven't received an offer written up in crayon :)
TLW...ROAR!
Randy, right on! As a coordination team that is often left to clean up the mess and close these transactions, we appreciate agent's that realize that if the contract is poorly written, chances are it is only going to get worse as the transaction progresses.
TLW, we have a saying in our office: "Nobody ever handed Picasso a box of crayons and expected a masterpiece". Unfortunately, we get a lot of crayons thrown our way these days.
Erica - I know a great real estate agent who can help you find the perfect home. :)
TLW - I am waiting for the offer in crayon. I have gotten more than a couple hand written.
Beth - On the flip side, clean contracts will get put your clients in a stronger position.
Kaye - Higher standards will always get my support.
David - I also got a bad one from an agent recently who has also been around for awhile.