Wednesday, October 7, 2009

Ethics in SHORT SALE process. Is there any????

Every new market condition creates new challenges for the realtors.

Buyers should disclose that are making multiple offers to the seller, because that my affect Seller's choice. But where? Is there any form approved by Department of Real Estate in any states?

There are debates if any action could be brought against the buyer making multiple offers on properties without full disclosure to the sellers for "lack of good faith". And for real estate agent representing the buyers for misleading information and manipulating the seller's decision of acceptance, according to a Code of Ethics.

How do we justify that? Agents representing buyers have a difficult time getting an offer accepted. Is it ethical for the Lender/Bank have no response for months? Certainly, it is ethical to a Seller, for whom the offer might the last chance to avoid foreclosure.

So, should you submit multiple offers on properties?

Every situation is different, and there are no blanket answers for a question like this. In the metro Phoenix area market, if you are interested in buying a short sale or foreclosure, you almost must submit multiple offers. It is not uncommon to submit an offer, and wait 10, 20, or more weeks to get an answer that lender/investor decided to reject the offer and foreclose anyway, so you are left off with angry buyer starting the process all over again. And buyer just want to buy a house, without waiting for months. It almost makes sense to secure offers on multiple properties and hope that at least one go through.

Without proper regulations and guidelines, the perception of today's market conditions is so puzzled, that is almost frightening to ask for correct answers. You put yourself at risk to receive to many different opinions.

Overall, I think that we have an obligation to a higher standards and the actions we take on behalf of our clients can never override our obligation to the Code of Ethics.

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