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Before you read… This article by Mark Weisleder is actually directed at real estate agents but I believe it’s also valuable for buyers and sellers to understand what can happen in a situation when a deal goes wrong. Robert.
As a result of the changing market conditions, buyers may not be able to close their deals this summer. Here are 5 key lessons for agents to remember when things go wrong in any real estate deal.
It goes without saying that when problems arise, it is easy for buyers or sellers to try and blame the agents for what has happened. In my experience over 34 years, it is rarely the agent’s fault when deals don’t close. You may feel sorry for the clients, but that is all you should feel.
Buyers and sellers think that if they threaten a lawsuit, somehow the agent will agree to pay part of their damages to end the matter. Remember, as long as the agent has not committed fraud, they are protected against any lawsuit by their errors and omissions insurance policy, meaning that you don’t pay for your lawyers to defend you. The client will typically be asked to pay at least $5,000.00 just to retain a lawyer to sue you, with thousands more still to come. In my experience, once clients see how much this is going to cost them, they end any talk of lawsuits.
Somehow buyers and sellers are of the mistaken belief that RECO and other Provincial regulators are collection agencies for consumers. Not so. While RECO is supposed to investigate every complaint made against a salesperson or brokerage, they are for the most part looking at whether the salesperson or brokerage followed their duties under the REBBA 2002 Code of Ethics for the protection of consumers.
Always make sure that all your paperwork is properly documented and that you have a written record of it. This includes making sure that the Working with a Realtor, Buyer Representation Agreement, Listing Agreement, any amendments thereto and the Agreement of Purchase and Sale have all been carefully explained, signed and copies delivered to the client. Also make sure that you try and document any instructions in writing as well, to avoid any misunderstanding later.
It is always stressful when someone alleges that you made a mistake and that they are going to suffer a loss as a result of what you did, or trying to blame you for their situation. Resist the temptation to say something you may regret later. Try something like this as an answer: “ I am sorry you feel that way .. I will review my file and my notes and will get back to you.” Then go discuss this with your manager or company lawyer and figure out what your next step should be.
If you have any questions do not hesitate to contact me.
Watch the video: Click Here https://youtu.be/ZVnZ4rsmNlQ
Mark Weisleder is a Partner, author and speaker at the law firm Real Estate Lawyers.ca LLP. Contact him at email@example.com or toll free at 1-888-876-5529