March 31, 2025 | 2 Minute Read
A few weeks ago, an agent submitted an offer on one of my listings. The contract seemed straightforward—no unexpected terms or conditions. It included a 10-day inspection period and close of escrow contingent on inspection approval, which was reasonable. After some negotiation, we agreed on the final price.
A few weeks ago, an agent submitted an offer on one of my listings. The contract seemed straightforward—no unexpected terms or conditions. It included a 10-day inspection period and a closing contingent on approval, which was reasonable. After some negotiation, we agreed on the final price.
The next day, I received a direct call from the out-of-state buyer. I reminded him that all communication should go through his agent as is required by the process, but he explained that she was unavailable due to an all-day continuing education class and had given him permission to contact me directly. I still made it clear that I would inform his agent of our conversation.
And after that, the deal went off the rails.
During our call, I asked about his experience with projects of this scale, as the property required extensive rehab. He assured me he had handled similar projects across the state, as well as in Florida and the Carolinas. Then, I asked if he was the direct buyer and would be signing at closing. After a noticeable hesitation, he said he had multiple companies and would decide which one would take title.
Sensing something was off, I pressed further: Was he a signatory or principal officer of the company that would take title? He dodged the question, only stating that it would be either him or one of his “business partners.” At this point, I suspected he was a wholesaler. When I asked directly, he denied it.
Inspections began, and a few days later, his agent emailed me: “Just a quick update—I’m not sure if you’re aware, but the buyer is assigning the contract. Is the seller okay with this?”
Seriously? This buyer had flat-out lied to me.
I informed the agent that the contract made no mention of an assignment clause. And, I don’t allow an assignment fee with a closing where there are agent commissions involved. The real estate commission frowns on this and during an audit, this may or may not be a red flag for a violation. It really depends on the auditor.
I told the agent it would have to be a double closing. The agents would be paid on the A-to-B transaction, and the wholesaler would profit on the spread from the B-to-C closing. Knowing this property would be challenging to sell, I decided to let it slide.
As expected, three investors arrived for the scheduled “inspection.” In the end, none were interested, and the buyer signed a release, walking away from the deal.
This “buyer” appears to be a new wholesaler who mislead both agents. It’s unlikely that I’ll want to work with him in the future.