What happens to a sales contract overall, if I (the seller) dont agree with the addendum of sale?

I think you are talking about an Amendment to the contract, not an Addendum. Addenda are usually included with the offer to purchase. Once the offer is accepted, the contract is changed via Amendment.

If a buyer submits to you an Amendment to the Offer to Purchase and you do not accept it, then the buyer has a couple choices. First, they can move on with the purchase as if the Amendment never existed. Second, they can submit to you another Amendment with terms you may find more favorable (you can also offer them a Counter-Amendment of your own). Lastly, they can send you a Cancellation and Mutual Release to back out of the deal.

As a Seller, you do not have to sign the Cancellation if you think that their reason for backing out is not provided for in the Offer. The discussion on this is a whole other blog post!

How often should our listing agent be in touch with us?

At MINIMUM an agent should contact you to set up showings (or let you know when one is scheduled if you have already moved out) and then to provide you feedback from the showings. If you are not getting many showings, the agent should at least touch base with you weekly, either a quick call or an email.

Your agent should also be watching your market and let you know about new listings, what other homes are getting offers and what homes have closed to help you price and market your home more effectively.

How do I know when my listing agent isn’t doing a good job for me?

There is no way to give a quantifiable answer to this question. My best answer is “you will know”. In fact, if you have to ask another agent this question, then you already know the answer!

When you first meet an agent, they should lay out what they do to market your home, to encourage buyers and their agents to bring an offer and also how they will stay in communication with you. This is also a good time to lay out your expectations of the agent.

How often should a listing agent follow up with showing agents?

Your listing agent should definitely follow up with every agent after every showing. If the showing agent doesn’t reply, your agent should hound them until they get feedback or a restraining order.

If a showing agent indicates their buyer has some interest, then your listing agent should keep in touch with that showing agent to try and prompt an offer. They shouldn’t hound them, but just stay in touch.

If you change your price or decide to offer incentives to either buyers, their agents or both then your listing agent should contact every agent who showed your property.

Lastly, if you decide to expire your listing with that agent and list with another, your old listing agent would be wise to stay in contact with the agents who showed your home while he had it listed. More on that in another blog post in the future.

Can a seller back out of a purchase agreement if the appraisal higher then selling price?

Buyers and sellers can do whatever they want in a transaction. It is just a matter of your return on the decision.

As a seller, it can be very frustrating to find out that your home appraised for more than the agreed upon selling price and I sure couldn’t blame you for wanting to back out of the offer. However, the contract is on the buyer’s side on this one.

Assuming that all other contingencies have cleared and the buyer has performed as expected per the contract, if the seller tries to back out because of a high appraisal, the buyer does not have to let you out of the deal and can sue you for what is called “Specific Performance” which is the legal way of saying they can force you, in court, to follow through with the offer and close. If the seller manages to prevail in the suit, they will definitely be out the attorney fees.

My question back would be if you do manage to break the contract, what next? Will you re-list at a higher price to reflect the appraisal? Know that the higher price will cause you to be on the market longer and could possibly wind up with you right back where you started – or even lower!

My advice to you is to be happy you sold your home in a tough market and enjoy your new home.

Our agent told us to not counter and accept the offer…why?

Because your agent is overstepping his or her bounds and likely putting their interests ahead of yours.

An agent’s job is not to tell you whether or not to accept an offer. An agents job is to give information and advice so that you, as the seller, can make the best decision possible for you and your family.

As a seller, do you think a home inspection done prior to the listing is a good idea?

Absolutely!

Doing an inspection prior to listing can give you a heads up to potential sticking points you may not find out about until you have a Notice of Defects in your hands and see your buyers off to the next house. Having a pre-listing inspection also shows you care about providing a good home to your buyers.

The downside of having the pre-listing inspection is that it may bring up defects that require disclosure on the condition report. If you choose to fix these issues, then you should have no problems.

Do incentives offered by sellers such as closing costs or gift certificates actual attract buyers?

As far as I know, no real estate sites offer an option to search by incentives offered, but they all do offer an option to search by price.

Buyers generally search for homes by location, number of bedrooms and baths and by price – some will get more specific, but the majority will use at least these criteria. When they input their range it is usually by multiples of $10,000 or $25,000. If your home is listed over their search range, you may never get on their radar, even if your incentives net your price within their parameters.

A home priced at $274,900 with no incentives will get more views and a quicker offer than a home priced at even $276,000 with $5,000 in incentives.

My advice to a seller would be to first get to or even under your markets closest $25,000 mark then think about incentives.

I have two CMA’s from different agent that are drastically different prices. Which agent is right?

“CMA’s” go by a couple different names, one being a “BPO” or “Broker’s Price Opinion”. The prices you get from different brokers are going to be as different as the brokers themselves.

You can pretty much separate brokers into two camps – listing buyers and listing sellers.

A listing buyer may give you a very inflated estimated listing price in hopes that you will think that he is a wonder agent and will get you a ton of money for your house. Sometimes they do while other times they will start campaigning for price reductions almost immediately.

A listing seller, on the other hand, will give you a lower price because his focus is to get your home sold quickly and the best way to do that is price it low. Your house will likely sell quicker than if you had listed with the listing buyer, but you may wind up selling your house for less than you could have otherwise.

Neither one is better than the other (however, I would argue that the guy giving you the low number is more brave than the guy giving you the high number). Both have the same motivation – to sell your house and get paid – they just have different ways of going about it.

Both agents should have provided you market data and should have also walked you through that data to justify their listing price. As the seller, your job is to look carefully at this data with the agent and ask questions. Look at the listings the agents present you and compare them objectively with yours – put yourself in a buyer’s shoes. Would you pay more or less for these other homes than you would for yours? A good agent will have shown you enough data that you can also come to an opinion.

My advice to you is to choose your agent based on everything BUT their list price since the list price is not their decision, it is yours. Some agents will walk away if your desired list price is too high, some will further counsel you as to why a lower price is better and may then either sign you up or pass on your listing and others will just sign you up and start campaigning for price reductions afterwards. It is up to you to make the decision on which scenario is best for you.

Can I cancel a residential purchase agreement if buyers do not remove the contingencies in a certain time frame?

The answer depends on which contingencies the buyers aren’t removing. When some contingencies aren’t met by the buyer, they just expire and things move on as if they never existed. Others require action and can cause a seller to cancel the purchase.

Contingencies that expire without consequence to the seller are the Home Inspection, Testing and Appraisal. They are worded to say that if the buyer does not act upon these contingencies by the given end date then things just move forward.

Contingencies whose expiration without action by the buyer can cause problems include the Deposit of Earnest Money, Loan Commitment and the Closing. If any of these pass unfulfilled by the buyer, the seller can cancel the offer at their discretion.

Other contingencies that may be added by the buyer and their agent are usually the second type. For example: “Buyer to provide loan commitment within 3 days of acceptance”. While this isn’t really the proper form for this contingency, it is assumed that if the buyer does not provide you the loan commitment you can cancel the deal.

Whether to cancel the deal or to try to keep moving forward with a buyer who missed their contingencies depends on the situation in your local market. If you have other buyers lining up for the house (or at least a bunch of good showings) then it may be wise to let the current buyer go. But, if the action on your house has not been so hot, then your best bet is to try and continue working with the bird in your hand.

Posted in: Sell Your Home
Tags: addenda, addendum, advice, amendment, cancellation, contingencies, follow up, home selling, listing agent, pre-listing home inspection, purchase agreement, Real estate, realtor, sales contract