Seller's Broker Ethical Violations

both dirtbag moves, you have to very clearly spell things out for brokers and ask very specific questions. what did your attorney say about the first situation? both unethical in almost anyone's book but the first may be breach of a verbal contract if a deal was made/offer accepted. you may have legal recourse. i'd check with an attorney.

Without a signed contract, it would be hard to remedy the first problem - it is bs though. Same with the second - also bs on the seller's side. Very few verbal agreements can be enforced, but you should ask your attorney. Turn the situations around - if you offered $X, the seller accepted $X and then you backed out before you signed the contract, would you be forced to buy it. I don't think so.

I also had a bad experience with a broker where we put in an offer, she sat on it for a few days (the place had been on the market for 90 days already!) and then called for our best and final (she never countered). She said she had another offer. We did not up our bid. She waited 3 more days and called to say we won. By that time we found a different apartment. I watched that apt. on this site and corcoran and it sat on the market for 4 more months (she was replaced as the agent a couple weeks later). She never had a second offer, but tried to get us to increase anyway. I think that is unethical, but there is no recourse. Real estate is a weasely business.

My attorney had nothing to say about the situation because it would cost me too much. She just told me that it was an unfortunate situation that doesn't happen too often. However, she did return my $500 deposit which was a very honorable thing since she had already reviewed the contract.

As for the second case, the seller's broker was, as you said, a weasel. I haven't bothered to see what happened with the unit but, when I did put in my best and final ofoer, I did so with the condition that it would expire at noon the day after the open house. That way, they'd be forced to accept my offer before anyone else had a chance to put theirs in.

Thanks for your input.

Both moves are not necessarily unethical but unfortunately do happen. Unless there's a signed contract it's open game, and according to NYS law the seller can continue to show the apt until the contract is signed. The seller's broker has a fiduciary duty to get his/her client the highest sale price and often times buyers back out before the contract is signed, leaving the seller holding the bag.

I recently bought a place .... before I did I lost out of two places because I couldn't get the contract signed in time.

It's when the seller's broker plays games like the one described by the poster who tried to buy the place that sat on the market for 90 days.

vfr_ny, I'm surprised your attorney wouldn't even give you his/her view on it because it would 'cost too much'? This ain't rocket science...sounds like you should find another atty next time.

I second that, vfr_ny--that should have been a no brainer for your attorney. I have been in two situations with coops where the seller put out two contracts at the same time. The first situation they said, "Whoever signs it first wins." And in the second situtation they accepted our offer, our lawyer did due diligence, sent the contract back to them, and then the seller said, "Sorry, but we changed our minds and sent out another contract to someone who has a friend on the Board." From what I hear and see, despite my own broker saying that the sending out of contracts too two different buyers is unethical, it seems to happen often. It seems to be the standard method of operation, unfortunately. There doesn't appear to be any regulation amongst the brokers, except self-regulation. Not sure why the REBNY doesn't step up to the plate.

Call me crazy, but I don't understand why the first situation is an ethical violation. A verbal agreement on price doesn't constitute a verbal contract, since obviously a number of non-price issues haven't been settled. Exchanging contracts is just the next step in a negotiation, and unless you negotiated an exclusivity period, what's the problem with someone dual-tracking contracts?

Maybe it's somehow fundamentally different from any othertype of purchase and sale, but it seems to me that it's open season on a property until signed.

I had a buyer that agreed on the price but cancelled at the 11th hour and 59 minutes. She dragged contract signing for 4 weeks with a variety of petty questions/concerns. Finally, she advised us that she has signed the contract and we should get it tomorrow. Finally after a week of waiting for the contract, she sent an email backing out on the contract. Do I have any recourse? NO. People get screwed on both side.

I had a situation in which I sent a signed contract to the seller at the agreed-upon price and she sat on it for over a week. It was never entirely clear what was going on, but what I think was that the seller was just fishing to see what kind of price she could get for the place and was never serious about selling. Because I was doing a 1031 exchange, I had a limited amount of time to wait, so I asked to cancel the deal, and the seller's attorney sent back the contract and my check (which had never been deposited). I did end up finding another apartment, but this all cost me quite a bit in attorney's fees.

I understand the frustration with spending fees on a flaky seller/buyer.

Still, I think it's weird that in real estate that people consider going to a contract markup to be an exclusive process. In my line of work (mergers & acquisitions), it's just an extension of the negotiating process - you're still ironing out reps and warranties, disclosures, closing conditions, contract outs and the like. The only real good way to work them out is by actually negotiating a contract (rather than a term sheet). But it's still no different than when you're at the "I'll give you 3.6" and "No, I want 3.8" stage.

If it's important to you, just submit a term sheet or contract that puts a deadline on your offer, plus a demand for an exclusivity period.