My buyers put in an offer on a property a few nights ago, that I thought was pretty fair and good.The list price on the home was 179k we offered 172k and asked for up to $5,300 in buyers cc and prepaids and up to $1k in repairs. My buyers are receiving 5k in down payment assistance for the fha loan.

I was a little surprised to see that the agent typed up a totally new contract changing some of my verbiage for example.

1.Sellers only obligated to pay up to $1k in repairs only to satisfy FHA requirements

2.Binder deposit to be applied to cc and prepaids before sellers pay anything.


I spoke with my buyers regarding the changes and we were curious as to the motive behind the binder thing so I call the agent.........

First she goes on to tell me that her last 3 closings that the buyers got money back at the table and that she and her SELLER feel like this is the reason why we are in the financial crunch that we are in. "They" just want to make sure that the buyers don't get anything back at the table.

Has anyone else ever heard of such a thing? What business is it of the sellers?

By the way this agent and her seller followed us foot for foot through the home for the showing. I was so annoyed....I swore I could feel the seller breathing on my neck.

I've had people do things like that before...The financial crunch we're in has nothing to do with this deal at this moment in time.

You've got a buyer who wants to buy, and a seller who wants to sell...to throw silly terms into the agreement because of principle is just mucking up the works.

If I were the buyer I'd walk, leave it for a week, let'em think about it, then re-submit my initial offer.

But then again...I'm not the buyer and I'm not in love with the house...

What you received was a counter as you know. Your point is valid IMHO. It is absolutely none of their business if the buyer gets any money back at settlement. It might be worth it to remind the other agent that the identical house a few doors down is just as nice as there's and just see the reaction. I'm on my soap box today, but that sounds like BS to me.

Its a counter offer. Perhaps the seller is in a situation that he feels he can do so. My guess is the other Realtor is not on a mission but his seller is looking for a better deal.

I would take my buyer and move on down the road.

Ok so it's not just me that seems to think this is crazy. I really think the agent is over stepping her bounds.

I do agree that we are in a credit mess because of some shady financing but this couple actually has a "decent" score (670 mid) and plenty in reserves.

Isn't the agent supposed to be working in the interest of her client? This would be the seller--if you were representing the seller wouldn't you try to get as much as you could for them? You were asking for a lot for your buyers--as you should, since you are representing them. It's only fair that the other agent do the same thing for her seller.

My question to you is, if the buyer has a decent score, and plenty of money in reserves why are they asking for all of this extra $ (down payment assistance, cc and prepaids)? Why aren't they lowering the price of the home to save themselves interest? And, does the other agent know they have plenty in reserves?

I agree that messing with the terms you worked out with your lender is a bit out of bounds.

However, if I were the listing agent, I'd be very wary of any loan that had additional costs rolled into it. That could be the case, and the agent just isn't that great at communicating it. Whenever costs are inflated into the cost of the home, there is a risk of inflating the home's loan amount beyond what it is worth.

It is a listing agent's responsibility to make sure a contract is clean, and when a home includes thousands of dollars being rolled back into buyer costs there is a risk that the home won't appraise.

If you have 60 days before the appraisal deadline, the seller could be over a barrel if the house doesn't appraise. They will have effectively taken their house off the market with no recourse whatsoever. Given current market conditions nationally and the squeeze being put on mortgage brokers and appraisers, the risk of such a home not appraising is probably even higher.

It's a counter....why is that overstepping her bounds?

Joel brought up great points too....given the current mortgage situation, maybe they're wary the house won't appraise and it will be off the market.

And where are they getting "downpayment assistance"?...do you mean from a relative? Or is there some kind of local program in your area they are working with? Because with the demise of Nehemiah and Ameridream, that would sure make me wary also.

OK, "Out of bounds" was probably too much, but nothing irritated me more than when I carefully crafted an offer specifically worded in a way that I knew my buyer's lender was going to approve and then a listing agent goes and screws with the language without first calling me to discuss why certain provisions/credits were included. Getting highest price & best terms is certainly the listing agent's responsibility, but negotiating without picking up the phone and doing a little digging is just going to throw a wrench in the process.

In my opinion, not taking those steps is not helping anyone. That's all I meant by "overstepping her bounds."

I don't think you can immediately suspect that the other agent is recommending that type of agenda. But, if she's representing them she has to present their requests/desires in the form that they want.

Not a very smart way to counter in todays market. Laying a little ground work with an inquiry by the listing agent/seller, might have made the counter not seem as demanding.

The agents exact words were that she and her seller wanted to make sure that the buyer would not receive anything back at closing. She never mentioned anything about an appraisal. They are receiving state bond assistance.

She had such a snappy attitude and now she is blowing my phone up. Go figure.

It wouldn't be an issue is she had simply countered with a higher price or less in cc but that was not her deal. The numbers were basically the same, the verbage was just changed because she was worried that the buyers would get money back at closing.

If a seller is not walking away with anything, it could just be that they hate the idea of "paying" the buyer to take the home off their hands.

You and I both know that the seller isn't actually paying this cost, but this is probably an emotional time for the seller. Afterall - they are walking from the the most important investment of their lives, and have little or nothing to show for it.

It might help to point out that although it FEELS like the sellers are paying for it, it's still the buyers who are paying for the luxury of having cash back at closing. In fact, over the life of the loan, the buyers (not the sellers) will pay about $30,000 in extra P&I payments for the luxury of "putting $10,000 in their pockets".

Stepping on soapbox:

Given the current condition of the market, I absolutely hate this logic (because it's exactly this kind of logic that got the economy in the position it is in.) Buyers that need to get cash back at closing obviously can't afford to own a home, but they roll the dice anyway...

Buyers are treating their homes like an ATM machine, and when the market takes a slight turn, they are so highly over-leveraged, that they have no choice but to file bankruptcy. But hey - they were able to use their house to fund a car they couldn't afford, so what the heck...

OK, stepping off of soapbox now.

;-)