Outbidded on a house, now what?

Question

We found this house that has sat idle for a year. We loved it, has family history, we put a bid on it. Apparently, out of nowhere somebody else is interested, puts a bid on. Sellers agent tells us we're going to do a better and best for the bank, so we offered over the asking price and agreed to pay the closing costs. Our offer went in first (thats what she said atleast) and then two weeks later, we got outbid.

Here's my first part of my question...one day she said we were first, the next day she said they were first...she said she held onto to our offer until the other bidders turned theres in (is that legal). Anyways, the whole situation is weird. Do you think this lady screwed us out of this deal somehow? she was so wishy washy.

Next...somehow we got outbidded...so what do we do now? We really need a house. We looked at two other ones and one was sold the week before and the other one isn't in liveable condition. Is there a still a chance we could get our first house?

Thanks, any advice would be great

Answer 1

The agent shopped your contract for a higher commission.  No ethical, not cool.  Next time get a buyer's agent.

Answer 2

I've known of real estate agents who claim there's a higher bid to try to get you to bid more.  It's certainly not ethical but it does happen.  The inconsistencies in this agents story is something to be concerned about.  Get your own agent so you're represented and not going through the sellers agent.  They're out to make the most for the seller, and themselves as they do that.  

  

    

Answer 3

Your first mistake was not getting your own agent to represent you. You're basically being represented by the selling agent now, which sets up a conflict of interest that usually favors the seller.

When you submitted your offer with her, she probably sat on it until she got another offer. Now when you submitted your best and final offer, she sat on that on, too, to see if she could drum up a bidding war (she gets paid a commission based on the sales price of the home).

Is it illegal? I'm not sure. But, it is unethical.

There's a lot of flakes out there posing as real estate "professionals" that will do anything to squeeze one more buck out of the buyer. In this case, she knew there was another potential offer out there. Since she was unethical in the first place, I wouldn't be surprised if she hinted at - our outright told the other buyer - what your offer was, so they would be sure to come in with a higher one.

If you want to follow up on this, contact your state or county real estate board and file a complaint. In the mean time, get yourself a buyer's agent. Their commission is paid for by the seller. So, you have nothing to lose and everything to gain by getting your own representation.

Answer 4

Sounds like a bidding war that may or may not exist.  The brokers love them but a bidder should walk away!!  Make it clear that you will not participate in a bidding war if the subject of a second bid comes up during any discussions.  Brokers don't like that attitude but it does keep them honest.

  It is unethical for her to hold onto your offer(but it is not illegal).  My advice is WALK AWAY!    It is the only way you can protect yourself from an unethical broker.  You have no proof that another bid even exists--just her word for it.  If this is an REO call the bank and inquire about the status of the property and how many bids have been placed on it.

Another piece of advice is don't fall in love with a property.  You wind up overpaying because you just absolutely must have the property and will do anything to get it.  There are properties coming on the market every day and now there is is a whole bunch of them out there.  Good luck!!

Answer 5

It does sound like she shopped your offer.

First, as the others note, you really need your own agent. There were all sorts of things that could have been done to protect you. First, how long was your offer good for? You say "two weeks later, we got outbid." Your offer should have been valid for a short period of time--say 72 hours. After that, it would have expired. It would have forced the sellers to decide quickly. If you were dealing with a foreclosure (you refer to a bank), then the time limit wouldn't have worked, but there would be other steps you could have taken.

You can keep an eye on the one property. But get a Realtor to represent you and start looking for other properties.

Answer 6

Well, the seller is the one who makes the final decision on which offer to accept.  The seller's agent is obligated to show all the offers to the seller and the seller can hold on to the offer and select a date to read all offers together so it doesn't matter of when did you turn it in. The seller's agent also by law not allowed to disclose the bidding price to buyers so you won't know how much the other buyer had overbid you.

If you really like this one, keep an eye on it while shopping for another one on the market. In case, this buyer cannot close the loan you can submit the offer again.

Answer 7

Sorry to hear about your situation. It sounds like she was a little shady. If you feel in your gut that she is, I would suggest dropping her out of the loop and finding someone else. Before you do, consult the Better Business Bureau and take a look of the backgrounds. When it comes to your finances always trust your gut instinct. ALWAYS.