Anyone who has ever done business for themselves knows that you rarely get 100% transparency in most transactions.
Business people have their best interest in mind, even if a win-win would make things better for everyone.
Don’t get me wrong, there are honest people out there going the extra mile, but they are not the majority
Maybe they should be, sometimes you can be too helpful and honest. I’m guilty of it and it does lose me deals sometimes. I’d rather have the goodwill I suppose.
No Good Deed Goes Unpunished
Since I have gotten my real estate license for the purpose of selling some of my rental properties it seems I have stumbled into the retail side of things for people in my network.
Found myself in four deals, two of them are not closing because of me honestly looking out for folks.
I’d like to share one of them.
Figure out the financing yourself
Listed a property for an investor in my community I know. Had an agent bring his buyers, a soon to be married couple that needed to close and move into a property by March 1st.
They wanted to see anything I could show them. So I should them a three bedroom the investor also has that will be listed in a few weeks.
They fell in love with it, made an offer and after a little negotiation they and my seller agreed on a price.
All the information they need to know is in the listing. Financing options, etc. etc. However, just by the talk of their agent I could tell they were doing a low money down or FHA loan.
The condo community I leave in doesn’t qualify for those loan since it doesn’t meet minimum reserve criteria set by the state that the bank use as a benchmark.
This means you need to be 20% down, but with a little creativity can get away with 10%. I know a kick ass mortgage broker that helps people get in their homes in similar situations.
Anyway, they contract had been written up and all I had to do is get it to my seller to sign, but I asked about their financing and the restrictions there are. The buyer’s agent was clueless about it, big surprise.
So I told them to verify with the mortgage broker if they could actually get financing and then call my broker as well cus if she can’t find a way it is not happening.
Long story short, their broker said it wasn’t possible and they disappeared frantic to find another place.
What, sadly many agents do instead
Have seen this first hand. Since me, the listing agent disclosed the loan “types” in the listing I did my job. Why tell them anything else, being that once they go under contract and get the inspection and are emotionally and financially invested then they will do whatever they can do get the financing.
If they need to borrow money from a family member for down payment, things like that. However, there is no guarantee, they could also just not qualify and get any help and then have wasted two weeks or more and now be screwed with just a couple weeks to find a close on a place, which isn’t possible when financing with a regular bank loan.
A.) say nothing and see if the 50/50 at best chance of the deal closing comes to fruition. If not this couple about to get married is screwed.
B.) Do what I did and let them get out in front of it and most likely lose the deal.
The fun part is….
The investor decided he is going to keep the three bed as a rental instead of selling it now. Thus, I lost the potential commission altogether now.
No good deed goes unpunished.