Real Estate

Buying with Selling Agent after previous deal fell-through?

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  • Jan 10th, 2020 11:21 pm
[OP]
Newbie
Dec 17, 2009
68 posts
14 upvotes
GTA

Buying with Selling Agent after previous deal fell-through?

Looking for some advice here.

A couple of months ago we were in initial offers on a property (only bidder as house had been listed for over 30 days with not successful offers). In shor,t we are about $15k apart on the deal and they subsequently removed the listing from the market (presumably to list in new year).

We are not currently under contract with our agent so my question is: would it be worthwhile to approach the selling agent to see if we can work out a deal if we use him for the purchase? Could we buy it even though it's not currently listed?

I understand there are some moral issues here but I am curious to know people's thoughts. We do like our agent but we were frustrated with lack of transparency in the offer process.
12 replies
Deal Addict
Mar 27, 2004
4620 posts
2265 upvotes
Toronto
its not about moral issues. its about the holdover period on your buyer rep agreement. if you go buy the house directly during the holdover period you are going to end up paying the buyer coop if your agent finds out. your former agent will bring it up with reco and you will lose in court. guaranteed.
Full-time Realtor
[OP]
Newbie
Dec 17, 2009
68 posts
14 upvotes
GTA
oasis100 wrote: its not about moral issues. its about the holdover period on your buyer rep agreement. if you go buy the house directly during the holdover period you are going to end up paying the buyer coop if your agent finds out. your former agent will bring it up with reco and you will lose in court. guaranteed.
Thanks but I don't have a buyer's representation agreement with current agent or any other agent for that matter.
Member
May 12, 2003
330 posts
204 upvotes
GTA
If thats the case, why not just go directly to the buyer? Since its not currently listed, assuming they aren't under contract either

see what they say...
sarkj wrote: Thanks but I don't have a buyer's representation agreement with current agent or any other agent for that matter.
[OP]
Newbie
Dec 17, 2009
68 posts
14 upvotes
GTA
ssj4_ootaku1 wrote: If thats the case, why not just go directly to the buyer? Since its not currently listed, assuming they aren't under contract either

see what they say...
Hmm..interesting idea
Deal Addict
Mar 27, 2004
4620 posts
2265 upvotes
Toronto
sarkj wrote: Thanks but I don't have a buyer's representation agreement with current agent or any other agent for that matter.
Did you have one before when you submitted the offer?
Full-time Realtor
Deal Addict
Mar 27, 2004
4620 posts
2265 upvotes
Toronto
sarkj wrote: Hmm..interesting idea
The sellers would also have a holdover period..listing agents usually put 90 days.
Full-time Realtor
[OP]
Newbie
Dec 17, 2009
68 posts
14 upvotes
GTA
oasis100 wrote: The sellers would also have a holdover period..listing agents usually put 90 days.
Understood, so it would still be in the interest of their agent to sell the property.

As an agent, have you ever been approached in this situation? Appreciate your feedback.
Deal Fanatic
Jul 3, 2011
5768 posts
2931 upvotes
Thornhill
As Oasis100 stated the holdover period in your Buyer representation agreement could cause you to lose any savings you get secondly, even if your offer is outside of that, you can still be successfully sued by the brolerage/Realtor who tried to get you the deal if they can prove they were substantial cause.

sarkj wrote: ... We do like our agent but we were frustrated with lack of transparency in the offer process.
What transparency issues do you expect to overcome this way? The listing Realtor is obligated to act solely in the best interest's of the buyer - as a customer they get to tell the seller everything you share about you that aids the seller but tell you nothng that about the seller that aids you. As a client, they and you and the seller have to deal with this - you will ithis wording or similar in your Buyer Representation Agreement:
The Buyer understands and acknowledges that the Brokerage must be impartial when representing both the Buyer and the seller and equally protect
the interests of the Buyer and the seller in the transaction. The Buyer understands and acknowledges that when representing both the Buyer and the
seller, the Brokerage shall have a duty of full disclosure to both the Buyer and the seller, including a requirement to disclose all factual information
about the property known to the Brokerage.

However, The Buyer further understands and acknowledges that the Brokerage shall not disclose:
• that the seller may or will accept less than the listed price, unless otherwise instructed in writing by the seller;
• that the Buyer may or will pay more than the offered price, unless otherwise instructed in writing by the Buyer;
• the motivation of or personal information about the Buyer or seller, unless otherwise instructed in writing by the party to which the information
applies or unless failure to disclose would constitute fraudulent, unlawful or unethical practice;
• the price the Buyer should offer or the price the seller should accept; and
• the Brokerage shall not disclose to the Buyer the terms of any other offer.

However, it is understood that factual market information about comparable properties and information known to the Brokerage concerning potential
uses for the property will be disclosed to both Buyer and seller to assist them to come to their own conclusions.
[OP]
Newbie
Dec 17, 2009
68 posts
14 upvotes
GTA
licenced wrote: As Oasis100 stated the holdover period in your Buyer representation agreement could cause you to lose any savings you get secondly, even if your offer is outside of that, you can still be successfully sued by the brolerage/Realtor who tried to get you the deal if they can prove they were substantial cause.


What transparency issues do you expect to overcome this way? The listing Realtor is obligated to act solely in the best interest's of the buyer - as a customer they get to tell the seller everything you share about you that aids the seller but tell you nothng that about the seller that aids you. As a client, they and you and the seller have to deal with this - you will ithis wording or similar in your Buyer Representation Agreement:
Thanks for the feedback. As I mentioned earlier (see post #3), I never signed a BRA even when putting in the offer. Are you implying that there are legal grounds for suing a buyer outside of a BRA being signed? Can you point me to the case law on this matter? I've never heard of such a thing making its way through the courts. Of course anyone can sue for a baseless accusation but if there's no BRA, would an agent really waste their time?

You don't think there's a lack of transparency in the process? Two agents having conversations together and each relaying a message back to their clients without either client being privy to that conversation? Seems to me like dealing with the selling agent would almost be the same.
Newbie
Jun 25, 2015
89 posts
57 upvotes
Toronto, ON
This seems like a huge red flag, what competent agent would write an offer up without signing a BRA or at the very least BCA(Buyer Customer Agreement)...
Deal Fanatic
Jul 3, 2011
5768 posts
2931 upvotes
Thornhill
sarkj wrote: Thanks for the feedback. As I mentioned earlier (see post #3), I never signed a BRA even when putting in the offer. Are you implying that there are legal grounds for suing a buyer outside of a BRA being signed?
Yes, there is a thing called implied agency which is where, as it sounds, agency - the agreement that one will act in a fiduciary capacity for another, is not under a written agreement but exists by the actions of the two parties. In that regard it is possible that the Realtor/brokerage that you were dealing with can show you in fact hired them as your agent to act in your behalf.

That said, I've no sympathy whatsoever for any Realtor who, before putting in an offer goesn't get in writing the buyer's direction as to the capacity under which the Realtor/brokerage will operate - client (fiduciary) or customer (self-represented). The Act governing Realtors in Ontario is very clear that even though no consumer is required to sign any such document, a Realtor is required to get such in writing and that it is an important document for determining compensation. I know too that there are Realtors in here who say they won't ask a buyer to sign such a document or have in the past insisted they would never ask a buyer to sign such a document.
Can you point me to the case law on this matter? I've never heard of such a thing making its way through the courts. Of course anyone can sue for a baseless accusation but if there's no BRA, would an agent really waste their time?
Despite the Act's written requirement, and an uphill battle for the Realtor, the courts can intervene and rule in their favour. The case in the below link does a really good job of explaining the issue of "effective cause" which I referred to as substantial cause.

Prior to going to the seller, you should seek legal advice so that an attorney can review all of your actions and guide you properly.
You don't think there's a lack of transparency in the process? Two agents having conversations together and each relaying a message back to their clients without either client being privy to that conversation? Seems to me like dealing with the selling agent would almost be the same.
That's not a lack of transparency - not every conversation exchanged needs to be reiterated to the client, only anything pertinent. There is no profession where clients are required to or even are privy to conversations by their hires and I'd wager that's not what you meant. In real estate, having one Realtor only invloved doesn't make that any more transparent, in fact, it makes it less transparent because of the non-disclosure info I posted previously.

The link
https://www.canlii.org/en/bc/bcsc/doc/2 ... ultIndex=1
Deal Fanatic
Jul 4, 2004
5708 posts
1769 upvotes
Ottawa
If you are going to do this, make absolutely sure you don't have a contract for the property with the original buying agent. I suspect all agents will make you sign one at least for the specific property if they are presenting an offer for you. You might not even have noticed that you signed it as it might have been part of the offer.

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