buyers who can’t perform
On which hill is a buyer in Elk Grove willing to die upon? We all pick our battles, but the hill on which we choose to die is special. That’s a question I ask myself when I see an offer arrive for one of my sellers. Most home buyers and their agents are fairly agreeable upfront, but down the road once we’re in escrow things can change. If agents and buyers start out on the wrong foot, though, odds are that they will continue on that same path. This is what I warn sellers about. I tend to share pertinent stuff that happens.
I just closed an escrow yesterday in which we had previously lost a few buyers on the short sale due to no fault of the seller or my advice. Our short sale market in Sacramento has pretty much fallen flat, thank goodness, and it’s odd for me now to close a short sale versus the hundreds I used to list and sell. The first buyer was in contract for about 48 hours before that buyer freaked out and canceled. The next buyer canceled when Fannie Mae asked for another $5,000 in sales price. Finally, we secured a third buyer who was willing to pay the extra $5,000 and wait for approval. This was a smart buyer because by the time we received the approval letter, the property was worth more than that $5,000 increase.
That second buyer had decided to die over $5,000. Now, there is nothing available in that complex anywhere near the price that buyer could have paid to own a property. The sales prices are higher.
In another escrow, we received a full price offer from an Elk Grove buyer who wanted to use her own title and escrow company, even though she wasn’t paying for those services. We pointed that out and sent her a counter. This buyer demanded her own title and escrow, regardless, most likely at the suggestion of her agent and argued ad nauseam over the issue. That was the hill on which that buyer chose to die.
It’s good the sellers passed on that buyer because the thing is a few days later another set of buyers much more willing to work with the sellers came along and wrote a spectacular offer that the sellers could not refuse. This is exactly what I shared with my sellers would happen. Nobody says you have to take an offer that makes you uncomfortable, and a REALTOR needs to look out for the best interests of the seller. Sometimes, that means saying no to an offer and letting the Elk Grove buyer die on that hill.
This weird homebuying story has been turning over in my mind ever since it happened as I’ve been debating whether I should write about such a wild and wacky situation. Today I say what the hey. It might save another buyer’s agent in Elk Grove from humiliation. Certainly, it could put another Elk Grove real estate agent on alert as this criminal is still on the loose (he wasn’t reported to the police). Although, no seller wants to take her home off the market for a phony buyer who is playing a con game, either.
Most real estate agents in Sacramento and Elk Grove go about their business trusting other people to be who they say they are. We don’t normally need to verify identification or missions. If a buyer says she wants to buy a home in Elk Grove, typically she produces a pre-approval letter, specifies her wants and needs, and we show homes. It wouldn’t hurt for agents to be a little less vulnerable, though.
This particular “home buyer,” we’ll call him Clarence, hauled his group of kids and wife to see a home in Elk Grove. His agent — not me, of course — picked him up at his home because Clarence did not have a car. Clarence also did not have a computer so he could not look at homes online, but he knew what he wanted: a gorgeous home with 5 or 6 bedrooms in Elk Grove. Clarence negotiated, through a counter offer no less, to buy a home in Elk Grove for cash. Half a million.
Where was the money coming from, otherwise known in the industry as Proof of Funds? The purchase contract gives a buyer 3 days to produce it. The buyer’s agent promised the listing agent the funds were coming. Every day, same story. That was enough to make the listing agent suspicious but the buyer’s agent was still hopeful. Where are the proof of funds, the listing agent asked again and again.
Turned out Clarence’s brother had won the lottery. No joke! Not only that, but Clarence had bought two brand new cars from Elk Grove Ford and those vehicles would be delivered at the end of the week to Clarence’s present home in Elk Grove.
You might ask yourself who would believe such a story — but then you don’t know real estate agents and how gullible many real estate agents can be. There is an entire industry that sells books, tapes and seminars to real estate agents because they can be so easily snookered. Who better to sell to than another salesperson? Well, I guess one could sell to a con-artist.
To be fair, an honest person might have a hard time believing that another human being would pull such a stunt, in addition to asking what’s in it for the con artist? The buyer can’t close escrow if he doesn’t have any money. He is not getting the keys early so he can’t take possession. What’s the point? I suspect the point is to dream. Maybe drive by and tell friends that he is buying a home for half a million. Perhaps to cruelly punish the children when they don’t bring home A’s on their report cards. “I promised we’d buy that house if you got an A in Science, but you failed, so . . . “
Maybe there is no rationalization at all. Maybe the buyer is mentally ill? At some place one needs to stop hoping for the best, look at the excuses and piece the situation together. There is always Google, too. Turns out Clarence had been arrested for stealing cars. He gave a Mercedes dealer a fake check and had driven off in a Mercedes before the police nabbed him. Clarence had been arrested several times, and his alleged wife (he probably wasn’t married) has a police record, too.
Since when do Mercedes dealers take a check?
Maybe it’s not a bad idea to Google your Sacramento home buyers, check Facebook? Especially if something doesn’t seem right. Trust your instincts.