The New York Times has an interesting article about a couple in California who are suing their real estate agent (who is conveniently also a mortgage broker) for allegedly artificially inflating the appraisal on their home by $100,000. A few days after moving in to their new home, says the NYT, “they got a flier on their door from another realty agent. It showed a house up the street had just sold for $105,000 less than theirs, even though it was the same size.”
The case is of national interest because it may set legal precedent for thousands and thousands of other home owners who bought at the height of the bubble:
When buyers have sued their agents in the past, the cases focused on problems with the property itself, often alleging failure by the broker to disclose a known hazard or maintenance issue. After reviewing litigation records for the last five years, the National Association of Realtors could find no cases that revolved solely around the question of valuation.
Ms. Ummel’s original suit included the appraiser, who was accused of skewing his report to make the Ummel’s house seem worth the purchase price, and the mortgage broker. Modest settlements have been reached with both.
In a brief phone interview, Mr. Little called the case “ridiculous,” adding: “The lady’s a nut job. I didn’t do anything wrong.”
Mr. Little said that contrary to Ms. Ummel’s claims, the suit was motivated mainly by the declining market. “When people see their home values and assets declining, they always feel there’s someone to blame,” he said. “This is a dangerous time for all of us in the industry.”
Mrs. Ummel may be the first homeowner to sue about this issue, but she’s not the first to suspect shady dealings between appraisers and mortgage brokers. Researching home prices yourself is important, don’t you think?
Feeling Misled on Home Price, Buyers Sue Agent [NYT] (Thanks to everyone who suggested this!)
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No, but I doubt you’re interested in conceptualizing all a real estate agent’s commission really does entail. I already stated some of the expenses in my previous post. Your one-liner indicates that you’re not interested in a discussion, but rather taking swipes at real estate agents who explain the real estate process because you don’t like what is said.
Would YOU counsel someone who thinks he or she needs a lawyer that, “no, you don’t need a lawyer”? Would you tell someone that he or she should not bother with an appraisal if he or she thinks it is necessary? Not if you’re a real estate professional you wouldn’t.
If you don’t want to pay that commission to sell your property, then you have to do it yourself including advertising, marketing, showing, meeting people when it is convenient for the customer, negotiating a sale, and be sure that you’re not breaking any federal, state, or local laws in the process).
Finally, if you’re going FSBO (for sale by owner), don’t expect a real estate agent to show the property to his customer if you’re not willing to pay us a commission for our efforts.
Finally, commissions are not fixed and are negotiable and vary everywhere.
I apologize for my lack of subject and verb agreements. That’s what happens when one hits submit too quickly.
@danielftl: well, my one-liner was initially much longer, but it all boiled down to that. actually, i’ve always had excellent experiences with realtors & i took offense at your simplistic view of what a realtor does.
my buying agent spent countless hours finding a home for me, showed me ~30 properties, was in constant contact with me when something came thru the MLS that met my needs & used his connections to let me in on a price drop before it hit the MLS. he even saved the deal when it was about to fall thru last minute (goddamn mortgage companies always looking to make a buck). i don’t think a single question i asked was met with a simple “yes” or “no” – he was excellent at explaining the process. to be quite honest, it felt like we were partners in the deal. & he topped it off with a bottle of vodka on move-in day. =)
the only bad experience i had was riding in his car…for every second his eyes were on the road, he spent 10 seconds dialing his phone, looking at maps, & pointing out details on the list sheets.
THAT is what i’d expect for $34,500. considering my house only cost $150,000, i think i made out like a bandit.
I have a Toyota Prius with a GPS built in. It also connects to my phone over Bluetooth. When I am in an area that I don’t know, I let the GPS guide me. I can talk hands-free on my phone while driving.
However, I TRY not to use the phone when I am with a client because I don’t want them to think that they are not important to me. Sometimes that is not possible, but I do my best.
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