Email Elizabethcode of ethics
Commission-Gate and the Sacramento Real Estate Agent
Who knew that selling Sacramento real estate was likely to turn into its own little Commission-Gate? Over my past 40 years in real estate, this was a first for me. Now, we know buyers are a bit desperate vying for certain homes, and agents can be all over the map when trying to help them buy those homes, too. But holy moley, you don’t throw a bag of money at the listing agent, for heaven’s sake. No, I don’t want to see the gold watches pinned inside your coat, button yourself up and get outta here.
Let’s set aside the fact that it’s against the law, probably violates the Code of Ethics, and it breaches an agent’s fiduciary relationship with her seller, and look at what buyers or their agent — hard to say where the idea originated — were coming from. See, Mikey here really wants this house, see. Poor Mikey and his dame, they just wanna buy a house, and they know it’s uncool to be packing heat. They don’t wanna wear no bracelets, much less end up in the stinkin’ meatwagon heading off to the Big House; so, instead, see, they’re just gonna sweeten the deal with moolah.
I can’t believe a buyer’s agent asked this Sacramento real estate agent yesterday to accept a kickback on the commission. She offered 25% of her commission to me as a bonus if I would just get her buyers into that house. What?
Yeah, my jaw is still hanging open. I had to tell her to hang on her to cabbage and just write the best offer that her buyers could write. I’m nobody’s stool pigeon but I’m kinda floored that she had the gall to ask such a thing. Is this Chicago? What’s next? No, I’m not going there because sure as crap somebody will try to do it if I say it. I’m not putting ideas into anybody’s head, not even as a joke.
This market is not bringing out the best in people. Some real estate agents are becoming forgetful. To some, the Code of Ethics is something dark and murky, in their past; they’re too busy crawling over dead bodies to get to that pile of gold. We simply cannot set aside our professionalism because the market is hard or inventory is low. I find this kind of behavior troubling because it reflects poorly on all of us.
What Sacramento Buyer’s Agents Want to Know
As a listing agent in Sacramento, I hear almost immediately from a lot of buyer’s agents when any of my new listings hit the market. Ding, ding, ding, my phone rings, one call after another. Especially if the listing is priced well and a turnkey home. The first thing agents want to know is if it’s still available, even if it’s only been in MLS for 30 minutes. That’s not as unusual as it may sound because my photos look enticing, the marketing verbiage is attractive and, in our competitive market in Sacramento, sometimes buyers don’t view the home before writing an offer. With digital online signing services such as DocuSign, buyers can quickly sign an offer within minutes for submission.
Of course, I check the Supra lockbox online showings to determine if the agent representing the buyer has entered the house. But that doesn’t tell me if the buyer was with the agent at the time. The buyer could live in San Francisco for all I know, but I can get a clue from the address on the buyer’s preapproval letter or earnest money deposit check. I can also just ask the agent. This is part of the information I pass on to my sellers as together we analyze the purchase offers.
The second thing buyer’s agents want to know is how much their buyer must offer to buy the home, on top of how many offers we have received. I will answer the third question but not the second, unless the seller instructs me to do it. And since it’s not really in the seller’s interest to disclose how high a buyer needs to go, few sellers will give me the go-ahead, yet buyer’s agents will still ask about it. They need to study the comparable sales and act accordingly; do their job.
Buyer’s agents will say: My buyers really wants to buy this house, so tell me how much they have to pay to get it. Well, I don’t know because it’s not my house. That’s the seller’s decision, and the seller probably doesn’t even know. If there is financing, the home needs to appraise. Moreover, if I tell that buyer’s agent how much everybody else offered, then I have to go back to all of those other agents and tell them how much the other buyers have offered. I can’t treat one agent with preference over another agent. They wouldn’t like it if the tables were turned and it was done to them. I am a REALTOR, which means I have to abide by the Code of Ethics, and I must treat all parties fairly.
It’s not just a made-up code that nobody follows.
Agents Who Represent Themselves on a Short Sale
Trying to buy a short sale for yourself is like yanking out your own tooth with a pair of pliers. Some people say the whole experience of a short sale reminds them of a root canal. When I was a kid, my mother used to tie a string around my tooth, and she tied the other end around a door knob. Then, she slammed the door. Sometimes, it took a couple of tries. Yikes. But it beat grabbing the pliers and doing it myself.
I don’t know of a single lawyer who would try to practice law in a field in which the lawyer had no knowledge. Yet, real estate agents try to do it all the time. In fact, when I represent lawyers for short sales — and I work with a lot of lawyers — I always suggest they get legal advice from a real estate lawyer. If a lawyer is in corporate law, she doesn’t know the ramifications of a short sale. Likewise, agents who work in residential real estate should not try to sell commercial property. It’s bad for the clients. It’s probably a violation of the Code of Ethics as well because it’s not in an agent’s clients’ best interest to hire a novice who knows nothing about the field to represent them.
The only thing that’s worse than representing a client when you should not is when that client is yourself. Because that’s just plain stupidity at the worse levels. I have an agent from southern California who is trying to write an offer on a short sale for herself. She apparently knows little about residential real estate in Sacramento, much less a short sale. She is also not a member of our Sacramento Board of REALTORS, so we are not required to reciprocate with her.
I have explained to the agent that she was missing the correct forms in her offer to make it a short sale offer. In short, the offer she dropped at my office because she doesn’t “do the computer” is not written correctly. I explained some of this to the seller when I sent it to her and suggested the seller ignore it. The offer has not closing escrow written all over it. The proposed buyer did not follow instructions in MLS because she cannot read the instructions as she is not a member. Her loan is complicated, involving several community agencies, which makes her not a good candidate for a short sale, even if her offer was written correctly, which it is not. Short sale approval letters from the banks on this particular short sale stipulate a 30-day closing, and her loans would take at least 45 days. Her preapproval letter is outdated and does not include a calculation for HOA dues, yet she is trying to buy a condo. And to keep a small commission because she has a real estate license.
One in about every 35 people in California has a real estate license. Having a real estate license does not make a person a real estate agent. You know what makes a person a real estate agent? Earning your living as a real estate agent, year after year. It’s experience.
When it comes time for my husband and me to buy another home in another area, I am certainly not planning to represent myself. I will hire an experienced local agent who works with retirees. There is just too much that could wrong. This particular real estate agent is doing herself a grave injustice trying to save a couple of bucks. She should hire an experienced Sacramento short sale agent to help her to buy a short sale. When I told her in the nicest way I could think of that she deserves her own agent, she raised her voice, threatened to call the NAACP and accused all agents in Sacramento of discrimination. What?
I wanted to say: Lady, I can’t see you over the phone. I have not seen a photo of you. So, I do not know the color of your skin and even if I did, which I don’t, it would not make any difference. Moreover, to imply that this Sacramento short sale agent would discriminate is simply preposterous. It’s completely ridiculous. Insulting. The problem is this poor woman needs help. She says she has a friend who is a real estate agent in Sacramento. I sure hope she calls him.
