Expert: liznarr - 7/29/2007

Question
We actually have two questions regarding our realtor.  We just got to Texas and trusted our realtor to look out for our interests.

1.  We found a house on realtor.com that we were highly interested in a small town near here.  We even drove by it before we brought it to our realtor's attention.  When we asked him to take us to see it, he called the listing agent and told us that "the house was under contract and was going to close in a couple of hours."  I've begun suspect he lied to us.  It has been over three weeks and the house is still on the market.  As a side note, the house is also $50K less than the other houses we were looking at.  Is there any action that we can take about his lying to us?

2.  Because of his lying to us, we put a contract on another house.  Since we were using a VA mortgage, he placed a closing date two weeks later than we wanted stating we needed to allow more time for the inspections.  Since we had never used the VA before we trusted him.  We wanted four weeks for the inspections and he put down six weeks.  It turns out all the inspections were done within three weeks.  
We asked if we could expedite the closing date and he said there was nothing we can do.  However, the contract says we can't close later than the provided date.  It doesn't prevent us from closing earlier.  He also doesn't know that we ended up going to church with the current owner's daughter.  She has told us her parents are ready to move now.
What can we do about this realtor?  He is definitely costing us more money by his actions.  I believe some of the adverse actions were done knowingly on his part.  However, there have been a lot of other instances were he has shown his incompetence.

Answer
Hi Janice,

Sorry to hear that you are having problems with your Realtor.

For starters, I would call the listing agent of the house you were first interested in and ask some pointed questions:  (1)  When did the house go under Contract,  (2)  Was there an earlier closing scheduled that did not occur,  (3)  Why is the property still on the market, and (4)  Did your Realtor ever talk to him/her about your wanting to make an offer?

In defense of your Realtor, when dealing with VA Contracts there can always be delays.  He was right to allow you more time than possibly necessary.  As you pointed out, however, most Contracts state that a closing date is “on or before” whatever date was filled in for the closing.

Since you now have inside information from the owner’s daughter on the house you currently have under contract and you know the Sellers are ready to move now, I would demand that your Realtor have you sign an addendum for an early closing and that he then immediately present the addendum to the Sellers’ agent.  He cannot refuse to do this, since you are his client and you are giving him a legal instruction.  Insist that he do this immediately, ASAP!  Tell him in advance that you want the Sellers’ signatures on the addendum, either accepting an earlier closing date or refusing to close early.  This way, he cannot come back to you with any excuses of “why” the Sellers would not sign the addendum.

If he gives you any guff at all, drags his feet or otherwise does not act immediately, bypass him and call his Broker-in-Charge (BIC).  Explain your situation to the BIC and tell him you want your signed addendum for an earlier closing presented to the Seller’s agent TODAY.  Do NOT accept ANY excuses.  If the BIC balks, I would call the Texas Real Estate Commission and ask that they intervene immediately and call the BIC to act.  For your information, here is the web address for the Texas Real Estate Commission:  http://www.trec.state.tx.us/index.asp

Short of immediate success with any of the above, draw up your own addendum (or have your attorney draw one up for you) and present it to the Sellers’ daughter and ask her to have her parents sign it, if they are in agreement.

What must also happen if you want to close early are the following:

1.   The Certificate of Reasonable Value (CRV, aka appraisal) must have been done on the house, and the house must have appraised for at least the sales price.
2.   Your loan must be fully approved by the lender, and all other conditions of the Contract must have been performed.
3.   Your closing attorney (or title company) must be notified of any new closing date and agree to have all documents in place and ready to close on whatever date you and Sellers agree on.

As to what you can do about a bad/unethical/dishonest Realtor, with proper documentation, you can file a formal complaint with the Texas Real Estate Commission (go to the “Complaints, Consumer Info” tab on the web address I posted above.  

Second, if one is truly a Realtor and not just a licensed agent, you can file a complaint with the Realtor association that he belongs to.  

Third, if an agent/Realtor has cost you money through negligence and/or dishonesty – and you feel strongly about recovering your damages – you can file legal action against him AND his BIC to recover your damages.

Before taking the legal route, however, I would present your bills for damages to his BIC and give him/them an opportunity to reimburse you without having to go the legal route.

Good luck to you, and write again if you have additional questions.

Regards,
Elizabeth