Pickpockets work in pairs. One person is the “bumper”. Their job it is distract the victim while the other person lifts their wallet. It’s a concert of choreographed movement. A work of art—really.
Real estate has the same scam. The real estate pickpocket involves agents colluding with one another to poach a client’s signed contract. Work of art? Yes, but in the total sleaze-bag category. This is how it works.
The Listing agent looks for contracts from buyers who have not signed a Buyer’s Agreement with their agent. Any contract that doesn’t have a signed Buyer’s Agreement can be stolen or given to someone else. Once a closing date has been selected, the Listing agent can T&R the original contract and shop the contract to other agents who will come in and undercut the original agent. Sound wild? It’s not.
Agents; getting your clients to sign a Buyer’s Agreement should be as important as your next breath. Still, too many agents don’t get this agreement signed. I have long felt this to be a generational problem. Younger agents find it off-putting to ask someone their parents age or older to sign a Buyers Agreement. Sadly, Boomer agents know this fact as they prey on the inexperienced.
True story. A Wynd Realty agent was 7 days from a scheduled closing, when they found out their contract had been sold. Six days from closing, the Listing agent fabricated a T&R, brought in a new agent, created a new contract and closed on the property. All within a week, on a mortgaged property? Imagine that.
You can read the GREC-filed Investigation overview here. But, long story short; Michelle Sanders of Realty One had a listing, a signed contract and a closing date with our sales agent. Our sales agent did NOT have a Buyer’s Agreement in place which meant the contract could be stolen or sold. Was it? We don’t know. Those involved aren’t talking. But, six days prior to the scheduled closing, Steven Dickens and Kisha Key of Keller Williams got involved. Six days after our agent was given the T&R, KW Agent, Kisha Key was getting paid.
Boomer agents ganging up to take advantage of others is not new. It’s kinda their thing, and in many ways a franchise specialty. But, as bad and morally abhorrent the behavior of KW and Realty One was, it’s not really the story here. We have a mountain of documentation on this case. It clearly exposes a “new” problem within our industry.
For the most part, sellers in our industry have been individuals. Individuals will generally all react within a normal set of predictable parameters. But, what if the seller is nuts and making decisions wildly. Everything breaks down.
We now live in the new “i-buyer” world which means the new, “i-sellers” are actually people who read spreadsheets and analyze data. Some i-buyers are MBAs from New Haven. (Yalies need only mention the town they went to college in) But, some i-buyers are just stupid people. And stupid is unpredictable.
The seller in our horrific example is Zillow. And yes, it’s “Zestimate” technology on full display. Zillow buys a property in early 2019 for $390K. By early 2020 they are begging for buyers at $355K. I am pretty sure this isn’t the way the “i-buyer” market is supposed to work.
After nearly a year on the market, our agent finds this listing a buyer. As the closing date approached, the guy on the line to buy this turd tells our agent, he needs a kickback from their commission or he is going to walk from the deal. Where he got this idea, we don’t know.
In this case, our agent had the courage to say “NO”; they weren’t cutting their commission. Seven days from the scheduled closing, our agent told the buyer, NO. A day later they were cut out of the deal and replaced by Kisha Key and Steven Dickens of Keller Williams.
How did this happen? GREC let you know. What will those involved say under oath? We will let you know. Why did it happened? Greed. Boomer bullyism. Franchise entitlement. But, as more and more i-buyers make mistakes, look for an increase in the number of sales transactions driven by desperation. Increased Seller desperation causes many to act in ways they may otherwise not have.
Protect Your Work!
Always have your clients sign Buyer Brokerage Agreements.