Provided by the California Association of Realtors, here is the top 10 list of mistakes that sellers make; and they can be easy to do. You get excited because there is an offer in hand and you think changes can be dealt with during the escrow process. That doesn’t usually happen.
The time to get what you want and need is before you get into contract. Your realtor should professionally navigate the way for you and advise on proper action in accepting the best offer and terms possible.
1. Acce
pting the buyer with the highest offer without regard to the other contractual terms.
Sometimes a buyer and their agent will bid very high to tie up a property, only to bail on it later. Anything that seems to good to be true, probably is.)
2. Not properly handling multiple offer situations with multiple buyers.
Agents owe honesty and fairness to all parties in a transaction. Agents need to make sure that sellers are treating all parties the same and giving the same opportunities.
3. Not properly handling back up offers.
It is easy to ‘sell a property’ to multiple people, so make sure to have the proper paperwork stating that your backup offer is not in ‘first position’ until signed contract and cancellation instructions are signed by the original first position buyer.
4. Entering into an agreement with no (or a small amount of) earnest money deposit from the buyer.
5. Entering into an agreement before verifying the buyer’s financial ability to close.
6. Not disclosing known material facts affecting the value or desirability of the property.
It is better to bring all the skeletons out of the closet.
7. Not providing the buyer with legally required disclosures.
8. Not obtaining the buyer’s written acknowledgement of disclosures.
9. Not considering whether to require the buyer to remove contingencies.
This goes back to item 1 above. No one really wants to rock the boat when you want to move on with your life. The issue here is that buyers have three days to review and consider disclosures and whether it will affect their quiet enjoyment of a property. You don’t want to find out right before close that the buyer has all of a sudden decided something is an issue. Two impacts from this: renegotiating at the last moment, or the deal blows up entirely.
10. Not excluding items from the sale that the seller wants to keep.
Where I have seen this being an issue is generally around light fixtures. If there is a light fixture you would like to keep, please take it out before you market the property. Why show the buyer something they can’t have? It just sets up the opportunity for bad feelings.
Bonus mistake
11. Listing agents representing buyers in a multiple offer situation.
This is my opinion. I don’t think it is ethical (although it is legal in California) for the listing agent to write an offer for a buyer when there are other buyers writing offers. It is too easy for the listing agent to have access to the other offers, prices and terms-having an unfair advantage, which is a legal problem. Agents owe honesty, fairness and full disclosure to all principals in a transaction.
Have any of these happened to you? Do I need to add any to the list?
