The more listings you have, the more properties you will sell, and of course, potentially the more deals that will blow up. When deals blow up, there is always the aspect of having releases signed and having escrow desposits returned or negotiated.
Sometimes an agent needs to negotiate the end of the deal similar to the beginning. In Pennsylvania, for the escrow to be released it needs to be signed by both buyer and seller. There are many cases where a buyer can back out of a deal due to a contingency (home inspection, termite, mortgage) and have their deposits returned. Sometimes an emotional seller will refuse to sign the release. What do you do ?
The above situation rarely happens to us. What happens more often is the grey area. When a buyer defaults or they took long with their inspection period is over or they sabatoged their mortgage. What do you do ?
Or in some cases, the buyer simply defaults. In that case, if the buyer does agree to forego his/her deposit, do you split the escrow with the seller ? More often than not, we will put a 50/50 split in our listing contracts for deposit funds defaulted by the buyer. So for those deals, we will still get compensated something for some hard work. On other times, to negotiate a deal and just be done with it, we have agreed to forego the 50/50 split with the seller and have the entire amount to the seller out of goodwill. What do you do ?
An example that we had this week is that a buyer was under contract to purchase 2 properties, had $3,000 on deposit for each property, defaulted and agreed to forego $2,000 per property. Thus, as a result the seller agreed with the split on the listing contract and in turn will get $1,000 per property and the broker (us) would keep $1,000. Thus, we our compensated for the time invested in a complicated deal and the seller will be compensated something for the time lost.
Of course we will find another buyer for these 2 properties for our client and get the next job done as well !!!
What are your thoughts ?
Philadelphia Real Estate - The Somers Team
The Philadelphia Real Estate Blog
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