Selling house to tenants - real estate agent disappeared

Buying & Selling Real Estate
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Selling house to tenants - real estate agent disappeared

Christian Luong
Member since 2018 · 9 posts · 1 vote

Hi all

I found myself in an interesting situation:

Background:

- Rental property (SFH) is located in Northern Virginia and tenants are interested to buy.

- I get representation from my property manager as a real estate agent in Feb 2020 (signed agreement expiring Dec 2020). Commission is set to 3% because buyer is already found

- tenants agreed on purchasing the house as is ($30K worth of repair: roof, wood) for around $435K. Est house price is $460K at that time

Situation:

As of March 2020, there is no news from the real estate agent. I learned from second sources that she has had a serious surgery and she is recovering in a nursing home. I tried to contact her daughter but no answer . House is now estimated at around $500K.

Since a large portion of the groundwork from the real estate agent have been done (finding buyer and negotiating a price), how would you move forward? I still have an agreement signed with her expiring in Dec 2020

Thanks

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Patti RobertsonBusiness Member
Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
5y

@Christian Luong - The agent must have a broker. It’s the way real estate works. Send me her name and I’ll look it up for you. Do you have a copy of the purchase agreement?  Do you have a listing agreement with be agent?  Do you have the buyers contact info?  There is no reason you can’t move forward with or without the agent but my guess is you will still owe the commission. If it has taken this long, chances are, your tenant didn’t qualify for the loan and you don’t really have a viable sale.

757-472-2547
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  • Catherine Emert
    Realtor · Bend, OR · Member since 2018 · 323 posts · 224 votes
    5y

    My suggestion is to reach out to your Agent's office and see if someone is covering their desk. A lot of the time someone steps in to help in these situations to keep income coming in for the Agent that is unable to work. 

    1Reply
  • Christian Luong
    OP
    Member since 2018 · 9 posts · 1 vote
    5y

    I have checked that already and there is no one

    Thanks Catherine for your reply

    0Reply
  • Evan Cook
    Real Estate Agent · Napa California · Member since 2020 · 23 posts · 8 votes
    5y

    Christian,

    Sadly if it does get to the point where the listing does expire with this agent you can always wait for her to get better, depending on how motivated you are to sell of course. But if you don't want to wait you can always go through another agent, or you can sell it yourself and just hire a real estate attorney to draw up the contracts.

    Best of luck,


    Evan

    0Reply
  • Patti RobertsonBusiness Member
    Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
    5y

    @Christian Luong - The agent must have a broker. It’s the way real estate works. Send me her name and I’ll look it up for you. Do you have a copy of the purchase agreement?  Do you have a listing agreement with be agent?  Do you have the buyers contact info?  There is no reason you can’t move forward with or without the agent but my guess is you will still owe the commission. If it has taken this long, chances are, your tenant didn’t qualify for the loan and you don’t really have a viable sale.

    757-472-2547
    2Reply
  • Mike McCarthy
    Investor · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    5y

    @Christian Luong I would move forward with the transaction and use either another realtor or title company. Get the deal done - and hold onto the 3% since you contractually still owe it to the realtor.

    The title company may put it in escrow and send a letter to the broker. At some point either you’ll get that money back, or you an negotiate in good faith with the realtor to terminate the agreement or decrease the amount.

    Lastly, as the agent is working under a broker license, the broker may have the capacity to nullify/terminate the listing agreement - but the title company can probably help navigate that.

    1Reply
  • Ika Sargeant
    Real Estate Agent · Reston, VA · Member since 2017 · 295 posts · 163 votes
    5y

    @Christian Luong, the right call is to get in touch with the broker. After all that contract is actually between you and the broker. The broker office phone/address is made public.

    0Reply
  • Christian Luong
    OP
    Member since 2018 · 9 posts · 1 vote
    5y

    Thanks for all answers and apologies in advance for any dumb questions  as I am a newbie

    - My real estate agent and the broker are the same person. She is hospitalized and I have gotten her daughter information. Still no answer from the broker.

    - The listing agreement is expiring end of this month (12/31/2020)

    - Property was to be sold to the tenant AS-IS with a discount ($30K for roof repair and others) using a 1031 exchange

    How could I move forward?  Can I send to the daughter agent something like a agent release form and go ahead with the sale? Shall I let the listing agreement expire?

    I need to get moving with the roof repair or transfer that responsibility somehow


    Thanks 

    0Reply
  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    5y

    @Christian Luong The fact the the listing agreement is expiring is irrelevant.....the purchase agreement with your buyer was executed During the listing term, so the commission is earned. 
    You don’t need the agent to continue, just contact the buyer, verify their loan is in place and contact the title company....then proceed. 

    0Reply
  • Christian Luong
    OP
    Member since 2018 · 9 posts · 1 vote
    5y

    @Wayne Brooks I haven't signed any document (purchase agreement) with the buyer and at the same time house price has increased $30K - I am willing to pay the agreed commission to the real estate broker but I want her to finish negotiating the price/selling the house/getting the paperwork ready

    0Reply
  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    5y

    @Christian Luong Well, apparently she can’t. 

    0Reply
  • Lynnette E.
    Rental Property Investor · TN · Member since 2018 · 2k+ posts · 2k+ votes
    5y

    If I were you I would let the listing expire.  You do not have a contract with the seller.  Your contract with the realtor is expiring in 2 weeks.  You tried to contact the realtor to have her fulfil her part of the listing agreement and got no response.  She may never return to work, but allowing her 10 months in your contract was way more than I would give a listing agreement.  Generally I give 60 or 90 days.  Value of properties change, some agents work better than others.

    I am not sure what state you are in, but you can have an attorney draw up the contract and you can have him negotiate it, or in some states, get the sales agreement from the escrow company and negotiate it yourself, or lastly after the current listing contract expires, hire another agent, increase the property price, maybe fix the roof so the house will pass inspection and the tenant can get a loan.  Do you know that if you have active leaks, safety issues, etc. many lenders will not approve a loan?  You should discuss that with a new realtor, if that is the way you choose to go.

    I disagree with the others about owing a commission.  The realtor had a listing contract and did not even negotiate a sales agreement with a known buyer in ten months.  She has not 'sold' the house.  To do that an agreement of some sort would have had to be signed between you and the buyer.  That did not happen.  She had the opportunity, but did not fulfil the contract of selling the property.

    0Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    5y

    I would go ahead with the sale and have a lawyer draw up the contract.  If you can't get hold of her or her office (guessing you tried the general number of her office), there isn't much you can do.  Life doesn't stop because she is sick or not returning calls.  

    Keep the 3% commission aside should she contact you. Yes she is owed it, but if it has been almost a month and she hasn't gotten back to you or passed your info on to someone else, then she's also not doing her job.  I get if she's sick, but what if you lost the sale because she doesn't have proper representation in place?  She's had a month to get things sorted.

    0Reply
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