I recognize that it’s totally passive-aggressive of me to bitch on my blog about the failings of my fellow real estate agents. It would be way more mature to just call them and say, ‘Yo. That was scummy. If you do it again I’m going to report you.’ I also realize it’s against my National Association of Realtor’s ‘code of ethics’ to out another Realtor for acting in a non-ethical manner (hmm… Alanis Morrissette comes to mind. Isn’t it ironic, don’t you think?).
But what good is having a blog unless you can passive-aggressively bitch in a non-specific and totally hypothetical manner? Plus, I like to think it can be a teaching moment for all of us. Let’s all come together and learn how to be a real estate agent who’s totally going to get sued if they keep this shit up:
Case Lesson 1 – How Not to do BPOs
Broker Price Opinions are decent money these days. Agents who do BPOs are hired as an objective third party by the bank that owns the note of a house attempting to be short sold. They get $50 or $100 to go out to a house that’s listed as a short sale and give the bank an opinion of value on the property. I knew a guy who used to do 8 of these a day, five days a week a few years back. He was saving up for his sexual reassignment surgery. True story (5 of the people reading this just went, ‘Oh yeah… I remember him.’).
The proper way to do a BPO is:
1. Call and schedule the appointment to see the house.
2. Show up at the appointed time to photograph and take notes about the house.
3. Go home and fill out the valuation form using current comps and your newly garnered knowledge about the property.
The improper way to do a BPO:
1. Call to set up an appointment to see the house.
2. Half an hour before the appointed time send your husband and small child to the house with a camera. When the homeowner asks for his credentials because she was expecting a female half an hour later, tell him to huffily walk out to his car, and come back saying he doesn’t have his wife’s card with him.
3. Fill out the valuation form without ever having viewed the property using only the information provided by your unlicensed husband and four year old daughter. Resist the urge to include your daughter’s opinion that the house was boring because it didn’t have any American Girl Dolls for her to play with.
Case Lesson 2 – The Wrong Time to Release Keys to the Buyer
I know in some states (and in most theatrical representations of real estate purchases) the buyer, seller, agents, title officers and roughly 11 attorneys all sit down together at a big mahogany table to sign documents and exchange keys and large amounts of money at the close of escrow. In Arizona this is not how it works.
Here, the sellers sign the paperwork to sell.
Then the lender sends the paperwork the buyers need to sign to the title company.
Then the buyers sign the paperwork to buy.
Then the lender reviews the paperwork and sends the wire with the large amounts of money.
Then, when the title company has received the wire, they release the file to record with the County Recorder’s Office.
FINALLY AT THIS POINT AND NOT BEFORE the property will be legally owned by the new buyer and keys can be released.
I know this is annoying and completely anticlimactic. I know all of my buyers want their keys right after they sign and think I’m a just trying to torture them by withholding their keys until the title company calls me to say we’re completely official. It’s not true, I swear. I’m not trying to be the annoying bad guy. The fact is; you don’t own the property until the money comes through and the deed is recorded. There are way too many cases where things have gone wrong in those few hours/days it takes for all of this red tape to be cleared away. They scare us with those cases when we get our license. And then our brokers hammer it home on a regular basis.
So just to be clear, if you’re the buyer’s agent and the buyer signs at 3PM on a Monday, and the listing agent shows up at the property on a Tuesday morning at 9AM to check the final condition of the property BEFORE escrow closes, BEFORE the wire has been sent from the lender to the title company, BEFORE the title company has received the wire and BEFORE the title company has released the file for recordation, and the following things have occurred:
1. The key has been removed from the lockbox and given to the new buyers
2. The locks on the property have been changed by the new buyers
3. The new buyers have had a brand new washer and dryer and fridge delivered and installed
4. The new buyers have either had a party or treated the appliance install man to about 40 beers as evidenced by the full recycling container in the kitchen
Then YOU’RE DOING IT WRONG. Also, I may not be able to prove it, but I think all circumstantial evidence points to the fact that you didn’t give the buyers the keys after they signed at 3PM Monday, but likely the Friday before. I know you probably know the buyers and that they’re really nice people and maybe it’s even your sister and her husband or something, but DUDE. Just no. So much legally not at all ok. You’re lucky nothing wacky happened this time and it all closed escrow. Please don’t do it again.
I hope we all can take away something from this lesson. Even if it’s just ‘Don’t act shady when you’re doing a deal with Elizabeth Newlin because she’ll totally call you out on her blog and it will be kind of humiliating.’