The One That Got Away ~ A Lesson Learned

A few months ago I had a buyer looking at homes in a 55+ community named Solivita in Kissimmee, FL. Solivita is a top notch community and there is some pretty stiff competition when trying to get an offer accepted. We saw quite a few homes and made a few offers that were not accepted. Well, we finally found “the one” and made an offer that was pretty generous. The buyers needed financing so their offer was not as competitive as it could have been and they knew that going in.

The home was being sold as a short sale and when we drew up the offer they decided to allow the sellers to accept back-up offers. During the time the 3rd party short sale negotiator (also a bad idea) was working with the seller’s lender a couple back-up offers were received by the sellers. One of them had no contingencies and was for $40k more than my buyers had offered. It was a damn good offer and very clean.

I wasn’t worried because...who in their right mind works for 4 months on trying to get short sale approval and then walks away from the current qualified buyers? Well this particular seller was not in their right mind apparently. When the contract was due to expire we sent over an addendum extending the short sale approval deadline. They wouldn’t sign it and canceled the contract. No one did anything wrong, unethical, or illegal. The deal just didn’t work out because the lender took too long giving approval and there was a better offer on the table.

The lesson I took from this situation is to advise buyers on a short sale not to allow sellers to accept back-up offers while we are under contract. Without the other offer I think the sellers would have just extended our contract and kept working at the lender. As it was, they had an offer that looked better to the lender and felt like they could gain short sale approval quicker with the offer executed.

This is funny because, if I’m the listing agent instead of the buyer’s agent, I would advise the sellers not to accept an offer unless they can take back-ups. However, I would not advise them to throw away a good qualified buyer’s contract. Either way I would advise whatever is in the best interest of my client.

This post is part of the ActiveRain contest “The one that got away - a contest for learning”. The point of this contest is to share our experiences with failure in the hopes that we can help someone else avoid the same failure by providing a lesson learned. As well as learn from everyone else’s experiences. On that note...I hope you learned something and have a great 2012!

Image courtesy of mikesansone at Flickr