Handling offers

RESPECT Respond timely Deliver promptly Obtain signatures Handling Offers RESPECT Respond timely Deliver promptly Obtain signatures Be able to explain all the terms of the offer Initial and date all changes Show respect to agents who bring an offer. Respect that the agent took the time to put the offer on paper and encourage your seller to respond to unacceptable offers by using the “Response to Buyer’s Offer” form. If you represent the buyer, deliver the offer with original signatures to the listing agent as soon as possible. Make sure that you are able to explain all of the terms of the offer. Remember that any changes must be initialed and dated by all parties. 2

Earnest money: Who holds it? Qualification HANDLING OFFERS Earnest money: Who holds it? Qualification Use updated and correct forms Submit complete offers The North Carolina Real Estate Commission recommends that the listing firm holds the earnest money. This is not a requirement. However, it is not always practical to get the money to the listing office in a timely manner. Either firm can hold the earnest money; the requirements regarding how the earnest money is handled are the same for both firms. Buyer qualification prior to submission of the offer is expected. NCAR does not allow older forms to be used following the allowed grace period after new forms come out. Offers should be legible and fully and properly completed. Offers should be on appropriate current forms, and should include all addenda, copies of checks, proof of financing and other pertinent items. 3

Legible copies – but keep all originals Progress HANDLING OFFERS Follow up Keep parties informed Legible copies – but keep all originals Progress Follow faxed or e-mailed copies of the offer or counteroffer with signed originals. If several changes are made, or if the same item is changed more than once, complete a new contract form to avoid possible confusion or disputes between the parties. Remember, ALL changes must be initialed and dated by ALL parties. The buyer's agent should keep the buyer informed regarding the status of the offer. Listing agents must present all offers until closing unless the seller has waived this obligation in writing. Listing agents should not speak for the seller without first discussing the specific offer with the seller. Keep all parties to the offer advised of the status of any counteroffer or suggested changes, and deliver the paperwork promptly. Once an agreement is reached, it is recommended that a final, clean copy of the contract be prepared and signed by all parties to the contract. The North Carolina Real Estate Commission requires copies of the original contract to be attached and maintained along with the final, legible version. The buyer’s agent and the listing agent should be in regular contact with one another and with their respective clients to ensure that all parties are informed of the transaction’s progress. Agents who represent the buyer and who are not subagents to the seller, have a responsibility to inquire about the existence of other offers. 4

RESPECT Multiple offers Presentation of offers Unaccepted offers Handling Offers RESPECT Multiple offers Presentation of offers Unaccepted offers Dual-agency disclosure Remain objective Listing brokers, in response to inquiries from buyers or cooperating brokers shall, with the seller’s approval, inform all buyers or cooperating brokers of existing offers. All terms, conditions and prices are confidential and can only be disclosed when authorized in writing by the offering party. Shopping offers is not permitted in North Carolina without the written approval of the offering party. All offers must be presented to the seller in an objective manner as quickly as possible, regardless of the order in which they were received. Neither the buyer’s agent nor the buyer should ever receive preferential treatment or an unfair advantage in the presentation of offers. If the seller rejects an offer, the listing agent should have the seller either complete a “Response to Buyer’s Offer” form indicating acceptable terms, or at a minimum, write “rejected” across the first page of the offer, and initial and date nearby. A copy of the “Response to Buyer’s Offer” or the first page of the offer marked “rejected” should be sent to the buyer’s agent immediately. Whenever a dual-agency situation arises – whether the listing agent and the buyer’s agent are from the same firm or the listing agent and the buyer are the same person – remember that the dual-agency relationship must be disclosed to all interested parties. As a listing agent or a buyer’s agent, you should always remain objective, especially when negotiating offers. Remember that it’s not your decision. 5

RESPECT Seller’s options Buyer’s options Expiration Handling Offers RESPECT Seller’s options Buyer’s options Expiration Responsible for notifications When an offer is received, the seller has the option of: Rejecting all offers, Waiting for another offer to materialize, Responding to more than one offer using the “Response to Buyer’s Offer” form, or Accepting one offer and rejecting all others. The buyer has the option of withdrawing an offer until acceptance has been communicated. If an offer has an expiration date and time, the offer terminates upon the expiration date and time if there has been no response from the seller. The buyer’s agent should confirm to the listing agent that the offer has expired since no response was received within the specified time. It is the listing agent’s responsibility to keep all buyers’ agents informed regarding the status of the offers on the property. 6

HANDLING OFFERS Discussion Questions Must all negotiations be completed by the expiration date on the Addendum to the Offer? No. The expiration date in paragraph 1 of the Additional Provisions Addendum is a deadline for a response only. It can be extended by mutual agreement while negotiations continue. 7

HANDLING OFFERS Discussion Questions Must you contact agents who have already submitted an offer when another offer comes in? Realtors®, in response to inquires from buyers or cooperating brokers shall, with the seller’s approval, disclose the existence of offers on the property. Where disclosure is authorized, Realtors® shall also disclose, if asked, whether offers were obtained by the listing licensee, another licensee in the listing firm, or by a cooperating broker. It is important to note that the North Carolina Real Estate Commission says there may be times when an agent could be required to make such a disclosure even if the seller has not given permission. 8

HANDLING OFFERS Discussion Questions What should you do if the listing agent tells you there’s a verbal acceptance on a property? Should you still submit an offer for your buyer? Yes. A verbal contract is legal but not enforceable. If a listing agent tells you that there is a verbal acceptance of another offer, have your buyer submit his or her best written offer immediately. An offer does not become a contract until both parties sign and the signing is communicated to the other agent. 9