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    dontknownuthin's Avatar
    dontknownuthin Posts: 2,910, Reputation: 751
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    #1

    Mar 4, 2014, 09:46 PM
    Conflict of interest
    I have an offer pending on a short sale condo. My realtor disclosed early on that she is colleagues with the selling agent as they work out if the same office, but assured me they would work separately and no conflict exists. I confirmed with her that each is independent.

    As the process has unfolded, I was mildly unhappy with inadequate attention and slow responsiveness to inquiries made of my agent. Without being rude, I let her know I needed greater attention to my questions from her. She took a hostile tone thereafter. I have felt recently that she seems to be advocating for the seller.

    An issue came to light in the inspection which required follow up by a specialized expert. For over a week I have not been able to get an answer to my request for access for the supplemental inspection. My realtor continued to behave like she is more loyal to the seller than me.

    I learned today that the seller's agent is my agent 's live-in boyfriend and business partner from a third party. I advised my attorney that I feel both realtors should have disclosed the to me and the seller and that I felt not advising us was a breech of fiduciary duty.

    Long story short, my realtor then resigned from representing me. In so doing , she stated that I may either withdraw my offer or work with another of her associates as my new agent... Yes, a third person from the same realty office.

    I want to use a realtor of my own choice who does not have a connection either the selling agent , nor with the realtor who fired me as a client. There are back up offers, but I have the primary offer, accepted by the seller and pending with their bank. As such, I don't want to withdraw and resubmit, and risk losing my primary position.

    Is there any legal reason I must either withdraw and resubmit, or use the realtor designated by my former agent when she quit? It seems crazy to me.

    Again, I did not ask her to resign.
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #2

    Mar 5, 2014, 05:51 AM
    Realtors most often represent the seller. I'm not sure what you even need a realtor for. A realtor is someone who markets and sells real estate. Some people will engage a buyer's agent to act for them in finding a property, but that's rare. Once you have found a property, you then engage an attorney to guide you through the process of going to contract, and a closing.

    So I would contact your attorney and ask whether you need the services of a realtor at all.
    ebaines's Avatar
    ebaines Posts: 12,132, Reputation: 1307
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    #3

    Mar 5, 2014, 07:11 AM
    I think you are misunderstanding what the role of the buyer's agent is. To support what Scott said - realtors are contracted by the seller and paid by the seller, so your realtor is not your agent, just someone who helps bring potential buyers to see properties. The selling agent essentially agrees to split half the commission he earns from the seller with the agent who is succesful at bringing in a buyer. It is not at all unusual for both agents to be members of the same real estate agency, and courts have ruled that this is not a conflict of interest. After all, once you have found a property you like all decisions about the amount you offer, contingencies, home inspection issues, etc are yours to make, not the realtors. A for working with an inspector - you are the one who has a contract with him- the real estate agent may provide a recommendation on who to use, but if you have an issue regarding a follow-up inspection that's your issue to work with the inspector, not hers. Really the only service she provides is to be a conduit for infomation flow between you and the seller. If you start using a different agent there is no reason why your existing offer would be affected. So I don't understand your concerns.

    However, selling agents often try to get buyers to sign an agreement stating that the buyer won't switch agents - did you sign such a deal? If so, you may be stuck having to take your ex-agent up on her offer. For future reference buyers should never sign such an agreement - unless you are paying for a service there is no reason to be restricted in what options you have for choosing agents to work with.
    talaniman's Avatar
    talaniman Posts: 54,227, Reputation: 10853
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    #4

    Mar 5, 2014, 08:14 AM
    Big mistake not having your own inspector before you tendered an offer. That's a better investment than committing your money into a deal that the seller and the banks profit from and can write off any repairs as YOUR responsibility.

    Cover Your Own Interests. I found this article to be quite good,

    Getting a Home Inspection | Nolo.com

    From experience though you hate to find out that the basement flood when it rains or the sewers back up in your house or any other condition that will cost you big bucks AFTER you have signed and made an offer. Of course the high bid gets more consideration, but their could be a reason the other bidders are lower, make sure they don't know something YOU don't.

    Jut being the high bidder isn't enough, being the smartest is.
    smearcase's Avatar
    smearcase Posts: 2,392, Reputation: 316
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    #5

    Mar 5, 2014, 02:55 PM
    "For over a week I have not been able to get an answer to my request for access for the supplemental inspection."
    Find a good certified independent home inspection agency and don't buy this property until you receive a satisfactory report.

    You may have to get your lawyer involved but I wouldn't buy this property under these conditions unless it was my only chance at financial survival.
    " I advised my attorney that I feel both realtors should have disclosed the to me and the seller and that I felt not advising us was a breech of fiduciary duty." What did he advise?
    dontknownuthin's Avatar
    dontknownuthin Posts: 2,910, Reputation: 751
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    #6

    Mar 6, 2014, 02:40 PM
    For clarification, I did hire an independent inspector at my own expense. He recommended additional inspection by a mold inspection service. The issue is not my willingness to get it done but the seller's or the respective agents frustrating the process of getting the inspector into the residence for the purpose of the inspection.

    As for both realtors working for the sellers, I do understand the philosophy behind that viewpoint and the fact that both are paid from proceeds by the seller. That said, in my state, the seller's agent must represent only the interests of the seller, the buyer's agent is to only represent the interests of the buyer. If they are crossing over or have a conflict of interest, it must be disclosed. Even if both the seller and buyer agree to proceed with that conflict in place, there are restrictions on what the buyer's agent can do. For example, if they are in a dual agency situation, they cannot recommend pricing - they can only share the comps with the buyer.

    So, my realtor had a major conflict and she did not disclose it. In fact, she lied and represented the opposite of the truth. When she was pressed on this by my attorney, she responded by calling me to quit her representation of me as the buyer's agent.

    Her agency is now claiming that unless I use another agent from their office, I will have to withdraw my offer. I could re-submit it, but if I did this, it would be cumbersome (Offer already accepted by the seller, inspection done, revised offer sent to seller, accepted, and now at the seller's bank for their approval). We are a couple months into this at this point. My specific question is whether there is any point of law in Illinois that would require me to withdraw my pending off on this home simply because my realtor quit on me and I don't want to use the replacement realtor she wants me to use?
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man
     
    #7

    Mar 6, 2014, 02:45 PM
    First, did you actually sign a contract with her as a buyer's agent? Again this is not a common thing to do.

    As to what the agency is saying, I would consult with your attorney. Since we don't know where you are or what laws apply, we are limited. But as far as I know, once a contract for sale has been extended and accepted, there is no longer any need for a realtor on the part of the buyer.
    dontknownuthin's Avatar
    dontknownuthin Posts: 2,910, Reputation: 751
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    #8

    Mar 6, 2014, 05:38 PM
    Thanks, Scott. The sellers bank hasn't responded... the also must accept. More negotiation is inevitable. My lawyer is looking into it but hasn't encountered this before.

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