Ask an Attorney IV - Picket Fence Preview Real Estate
Q. Is there any legal reason I can't advertise my property after I've taken a contract?
A. From a legal perspective, the reason why you shouldn't market your property once it is under contract is that you have an obligation to act in good faith to bring the purchase and sales contract that you have freely signed, to closure. Continuing to market the property when it is under contract can taint an existing deal and beg the question of whether the Seller has acted in good faith, potentially exposing one to litigation over a failed real estate transaction. One exception to this principle is the situation where the Buyer has a contingent sale clause and needs to sell property before they can buy, a Seller may reserve the right to market the property during the time period while the buyer is trying to sell another property, or for another reason, if stated in writing, in the purchase and sales contract.
Q. Can I choose not to show my house to someone? Or is that discrimination?
A. I think that a potential seller can opt not to show property for any non-discriminatory reason. If a seller chooses not to show property to a potential buyer, it may be advisable to document the non-discriminatory reason for refusing to show the property.
Q. As a seller, I don't need an attorney, do I? The buyer already has one, who will be doing the closing.
A. You really should utilize an attorney to sell real property. As a Seller, you want someone well versed in the process of conveying real estate taking care of the required State and Federal documents and tax returns. Additionally, the preparation of the property transfer tax return and your deed of conveyance should be done by someone who is representing your interests. Relying on the Buyer's attorney to handle all aspects of the transaction puts them in the difficult position, as they have an obligation only to their client; the Seller is essentially unrepresented.
Q. I have a buyer for my house. Is it okay if the buyer's agent holds on to the buyer's deposit? I told her I felt more comfortable with my attorney holding it in his escrow account but she was insistent.
A. I prefer to hold the deposit as a Seller representative. I would , in this situation, continue to insist that the Buyer's representative turn over the good faith deposit. It's the property of the Seller and the deposit really hasn't been delivered to the Seller if it is held by the Buyer's agent. If the Buyer's representative is holding the deposit, and the release of the deposit is in dispute, a Seller must take care to give all proper notices to preserve all rights, such as the right to mediation, or liquidated damages for non-performance, as may be included in the purchase and sale contract.
Q. My buyers found my house through Picket Fences, but had a prior arrangement with a buyer's agent who is now insisting that she is to be paid 6% for her role. Am I correct in thinking it's illegal for her to demand a full commission in a FSBO sale?
A. I'm not sure what the Realtor's Governing code would say about this situation, but I would tell the Seller that it is their choice whether or not they wish to contribute to the Buyer's Agent's commission. Some Sellers are happy to pay 3% or 1-1/2 % to a Buyer's Representative who brings them a favorable offer, others may feel that the Buyer's Agent's commission is solely the responsibility of the Buyer.
Answers provided by Peter Schubart, an attorney in Burlington VT 802-859-0059
