SO, what’s the catch? A Realtor states that if they can’t sell my home within 90 days, then they’ll buy it. Is this a good deal or not? What’s the scoop?
Okay, as the old saying goes: “If it sounds too good to be true – it’s not!”
Run, don’t walk, away from Realtors that offer this service. In my opinion, this is a deceptive marketing tool that some Realtors use. The way it works is they’ll advertise, “I’ll Sell your Home in 90 Days or I’ll Buy It Myself”. Sounds great. They must just be SO confident in their sales abilities that they can afford to buy your home if they don’t sell it, right? You happily set the appointment with the Realtor and they go over the fine print in the contract.
Here’s what the contract says: You will be charged a seriously over-inflated commission to list the home (could be as high as 9% or 12% commission). Why so high? Because they are taking on the risk that if they don’t sell your home, they may have to buy it! The other fine print you’ll find in these types of contracts includes language that allows the listing agent – yes, once again….”allows the listing agent” to set the asking price of the home, not you, and the price will be a good 10-15% below market value or greater, in order to make 100% sure it sells and thus minimizing the Realtor’s risk in the transaction. There also may be additional price reductions built into the contract. No Realtor WANTS to buy your home if they can’t sell it. Frankly, most don’t have the money to do so and will simply just walk away, cancelling your contract.
SO does the thought of paying 9% to 11% commission appall you? It should! Once you start balking at this, the Realtor then says, “but wait, there’s another option we offer! We also have the standard contract in which we don’t guarantee the sale of your home, and you set the pricing at market value. And that commission rate is only 6% “ (or whatever they charge, being more in line with what other Realtors charge).
You are so relieved that you can get your home listed for less than 11% commission that you excitedly sign the normal listing agreement, thinking you got a deal. Now wait – think about this for a minute. The Realtor lured you in with what I would consider to be deceptive marketing practices, and then bait and switched you to the standard listing contract, at a lower commission rate. You feel like you won in this negotiation however you need to know that this Realtor never intended that you would really sign at 12%, their goal was just to get you to sign and list with them at the 6%, and not have to buy your home. Did you fall for it? And is this really the Realtor that you want representing you? What do you know about their sales track record, marketing programs, or anything else they do?
You are better off to use a good Realtor in your town who’s highly recommended, has a proven track record and has excellent marketing strategies and who sets a realistic asking price for your home. This is what will get your home sold in under 90 days. I’ve done it many times! Your Realtor shouldn’t need to rely on a deceptive marketing practice to get listings.
For a reputable Realtor, call Vicky Baker – Managing Broker – Dancing Star Realty – 877-488-2234