Will a California real estate agent get in trouble if he refuses to submit a low-ball offer?

Question

Jennifer was driving by one day in Los angeles when she saw a sign infront a house, "Bank owned" sale, price: $500,000, contact John at Re/max.

Jennifer immediately calls John using her cell phone and asked if house is still available. John says it's still available and no offer yet.

Jennifer then tells John that she would like to submit a low-ball offer at 70% of asking price of $350,000. John immediately gets upset and tells Jennifer that she can submit low-ball offers as many times as she wants but he won't allow any of his agents to help her because it would be wasting time and bank won't accept it.

John also advises that if she doesn't fill out the paper work correctly, he won't even consider it as an offer.

Remember this conversation was done entirely through a phone call and nothing was signed.

Is there any problem with this dialogue related to DRE's rules and regulation and contact between an agent and a potential client? Any problem for John with DRE?

Answer 1

I don't understand the attitude of the Realtor (if properly presented). A commission on a low ball sale is better than none on a full price offer.

Answer 2

It sounds like Jennifer was not John's potential client. It looks like John is the listing agent. Therefore, his allegience is to the Bank and he is justified in encouraging Jennifer not to submit an unrealistic low ball offer. Jennifer did not have an established relationship with John or the agents in his office, and agents have the right not to work for potential clients that they see as unrealistic, because doing so would be a waste of their time. If John were to refuse to pass on a properly written offer to the Bank, he would be violating his trust with the bank. However, there is nothing wrong with him telling Jennifer that he will only do so if it is a valid offer. For example, if the offer did not include an essential element of a contract for real estate, it would not be binding even if the bank signed it. Therefore, an incomplete offer is like no offer at all. Note that he did not say that he would not pass on a properly filled out offer.

Answer 3

I've had that argument a couple of times in the past. A licensed real estate agent or broker is bound by law to submit any properly formatted written offer regardless of the amount. They may hem and haw and try to dissuade you but in the end the offer MUST be submitted. They are under no obligation to submit a verbal offer since all real estate sales transactions are required to be in writing.

I often use low-ball offers to feel out the seller's true desire to sell. They usually are refused but I've had them accepted on two occasions, much to the shock of the agent that was arguing against it.

Answer 4

There is no obligation to submit a verbal offer. Jennifer can submit a written offer through her own agent. The agent can request a response in writing from the bank so that Jennifer knows it was submitted.

Yes, John is obligated to submit it.

Answer 5

any offer (as long as credit is good) is supposed to be presented to the seller, no matter if it is a low ball offer or not. in this case jennifer needs her OWN realtor to pass on this offer she would like to make, all future homeowners should have thier own buying agent which in my opinion makes the transaction go better . good luck to jennifer and yes john could get in trouble for not passing on an offer, even if it is a low offer, he is obviously just looking out for himself... figures if price goes down, there goes his commission.

Answer 6

An agent is required by law to submit any written offer.

Answer 7

Let me make it simple a licensee is obligated by law to present a properly completed and signed offer agreement even if it is for $1.00