Friday, September 12, 2008

My Real Estate Nightmare (Part 5)

With my brother-in-law now on a mission to destroy all evil-doings in real estate (ok, maybe just all the shenanigans that happened to us), things were finally starting to look positive. Over the course of a few days, we were able to determine very quickly just how negligent our previous agent was, and how with the right agent on your side, how smooth things should typically go when selling your home.

On August 4th, when it was clear that our buyers (who were being sued for damages at this point) were no closer to fulfilling their obligations, we decided to put our home back on the market. We had had the original Promise to Purchase officially declared dead, so my buyers were no longer responsible for the house, but they were responsible to pay any out of pocket expenses I'd have to incur by carrying 2 mortgages.

Lesson 7: Always read brokerage contracts in full. It is also the law that the agent must clearly "walk through" the contract at the time of signing so that you understand everything being written (even if a similar document had been previously drafted).

In order to relist the property online, my wife and I had to sign a new document listing the price and granting the rights to list. When my agent presented me with the paperwork to sign, there was no mention that the document was a new brokerage contract -- which would extend her contract to us until December! At this point, I thought I was only signing permission to list the property online, not to continue working with a negligent broker for 6 more months... It was an error on my part for not thoroughly reading what I was signing (working on her guise that "you've signed this before, it's the same thing"), however, by law, she needed to explain to my wife and I what exactly we were signing. There was no way I was going to be held hostage for another 6 months like that.

Upon the advice of my brother-in-law, we decided to release hell. We called the broker directly and demanded either a shortened (1-month), non-exclusive contract with our agent, or to cancel what we just signed immediately.

Lesson 8: When the agent is a bad seed, the broker is typically the bad apple.

The broker's response was to wait 2 weeks before making up our minds, and then we'd re-evaluate the whole thing. In real estate, you have 3 days from receiving a copy of a signed contract to cancel it without any legal penalty. So what was going on here? The broker was trying to goad us into a lawsuit. Had we cancelled our contract 2 weeks later, we would have been totally lible for any commission our former agent would have lost should we have sold our house under a new agent. We couldn't believe this was happening to us. Not only was our buyer screwing us, but now our own agent was trying give it to us too? This whole situation was completely insane.

Fortunately, my brother-in-law, well versed in the anals of real estate practice, advised us on how to officially cancel the new brokerage contract by submitting a registered letter to the broker himself, as well as one to the Quebec real estate commission.

What would prove to be another error in a list of errors that we're still tabulating, we also found out that the agent indeed had the house relisted, but had left the OLD listing online as well, indicating that the property sold for $298,000. Had anyone decided to make an offer at that point, they would have been fully aware that we settled on that specific price -- so how could we have ever sold the house for more?

With a negligent agent now officially off our backs, we were able to look forward and open a new chapter in the process of selling our home.