A couple of weeks ago, I received a call from someone referred to me several years ago.  The call was unusual because she already knew which home she wanted to purchase and had already seen it.  Sounds like a real estate agent’s dream, right?   



The home is in Altadena, on a large lot, a great location but a fixer.  The home is also a short sale.  Short sales are far from typical but there are many similarities.  Most banks pay a 6% commission, which is usually equally divided between the buyer’s agent and the seller’s (and of course each brokerage receives their portion). 

In this instance, the seller’s real estate agent is offering the buyer’s agent just 2% commission (keeping 4% for himself).  But what’s offered is offered and that’s that. We submitted a full price purchase contact and asked that some closing costs be paid by the seller (the bank).  The offer was emailed to him, with the prequalification.  Many hours later, I received a short email: “offer not acceptable please revise”.  I emailed him asking that he be a little more specific as to what was not acceptable and waited nearly 24 hours to get a response. 

Typically when an offer is not acceptable, the agent will prepare a counter offer.  But no counter offer, just the vague email and he requested that the offer be rewritten (not just a one page counter).   In addition he was demanding a 3% deposit to be delivered to an escrow company of his choosing and one I had never dealt with. 

There are many ways to manage a short sale but when I represent the buyer, I prefer that no money is deposited in escrow until the lender approves the short sale.  The approval process can take anywhere from several weeks to several months (or never happen at all).  Why would I want my buyer’s funds tied up?   And in the event the buyer cancels, the seller really has no damages as he doesn’t have any equity.  There really is no need for such a large deposit.

The buyer and I discussed what I felt were very unreasonable terms.  I also informed the buyer that although I thought the Altadena home was aggressively priced as the commission was only 2%, I didn’t believe anyone would be beating the door down, trying to deal with this idiot of a real estate agent. We decided to sit back and wait (play a little hard to get).

The next day he phoned the office, Lisa told him I was out.  He phoned again, she told him I was on the phone.  She entered into a conversation with him and he told her to stop talking and to listen to him.  He really is a piece of work.

Fortunately my strategy worked, and he was soon singing a different tune. We agreed to a $500 good faith deposit.  And have opened escrow and are waiting for short sale approval.

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