Made an Offer - Time to Vent

[Jason@dvcstore]

Jason,

I appreciate your willingness to bring clarity to the process from your perspective. I just hope that people realize that you are going out of your way to offer this explanation and it is just that...and explanation and not a defense. The fact of the matter is that sometimes this business moves fast. If I were to be a seller (and I am not) I would take a hard offer that is on the table over a possible higher payout through a pending negotiation any day of the week. People need to realize that there are more people involved in this than just themselves and the seller and act accordingly. Nobody gets preferential treatment, time outs, or wait time. If you want a contract, bid to win. If you want a good deal, accept the fact that you might be outbid. Personally I have been outbid and have contracts closed on me without notice and I have won contracts thus shutting other people out. It's all fair and it's all part of the process. When it happens it's time to move on...win or lose.

Thanks again, Jason, for taking the time to explain the process.

Dan

PS In the interests of full disclosure, I have not purchased any resale contracts through The Timeshare Store Inc. Furthermore, I have no relationship with them and I do not have any bids pending with them.

You are welcome thanks for your helpful thoughts as well. I think you summed it up better than myself.

Jason Erpelding
Lic. Real Estate Broker Associate
From The Timeshare Store, Inc.®

 

[RayJay]

You're welcome. All offers are presented to the seller (if we have more than one). Then the sellers, of course, take the highest offer. The multiple offers situation typically happens when the seller doesn't answer their phone (we have to leave a message) or don't respond to our email ASAP or some sellers are on a cruise (lucky). For example, I took an offer tonight at 5:30 pm and I called the seller ASAP. The sellers wanted to think it over and said would call back before 9. I explained this to the buyers and also explained to the buyer that if another offer comes in it would have to be presented to seller or if another buyer called in to pay asking price it would be sold to them. The buyer understood. The seller called back at 7:30 and countered. The counter was given to the buyer and they accepted.

I hope that makes sense. My sentences might be running together.

Jason Erpelding
Lic. Real Estate Broker Associate
From The Timeshare Store, Inc.®

Thanks for the replies. I too appreciate the explanations, having bought and sold in the past I feel pretty confident on how everything works, but it's good for new folks like the OP to get the explanations of what truly happens in some cases.

Thanks
RayJay

 

[permavac]

...(2) This is not a "negotiating" process. You will have only 1 shot at a contract, so "Hit it with your best shot! And fire away!" ... (OK - I'm dating myself here ... )...

I guess this is what I learned but with a big caveat. Not sure how many points you're buying. I'm after small contracts. With small contracts, you really have to give it your best shot and that usually means a full-priced offer. Now, when I briefly toyed with the idea of getting a 150-point contract, I talked at length with my broker and we went through a bunch of properties that I would consider. I gave her my price and she said she would call all of the property owners (one by one) and make the offers. I did ask her how that worked and she said that if she didn't get the owner on the phone, she would leave a message with the offer but she would also tell them that the buyer (me) was actively trying to get an agreement in place and that I may have moved on by the time she heard back from them - so time was of the essence. One owner did agree to my price but I changed my mind and decided to go after a second smaller point contract. So, there is usually room for negotiation with the larger point contracts but, of course, if there is someone else interested in that particular contract then all bets are off...

And, of course, you already know that you need to be reachable ASAP when working on getting a resale.

Terri

 

[DougEMG]

You're welcome. All offers are presented to the seller (if we have more than one). Then the sellers, of course, take the highest offer. The multiple offers situation typically happens when the seller doesn't answer their phone (we have to leave a message) or don't respond to our email ASAP or some sellers are on a cruise (lucky). For example, I took an offer tonight at 5:30 pm and I called the seller ASAP. The sellers wanted to think it over and said would call back before 9. I explained this to the buyers and also explained to the buyer that if another offer comes in it would have to be presented to seller or if another buyer called in to pay asking price it would be sold to them. The buyer understood. The seller called back at 7:30 and countered. The counter was given to the buyer and they accepted.

I hope that makes sense. My sentences might be running together.

Jason Erpelding
Lic. Real Estate Broker Associate
From The Timeshare Store, Inc.®

Makes total sense to me.

 

[goldenears]

You're welcome. In hindsight I should have said to the buyer in the email (or when talking to them on the phone) "Be advised I am going to present your offer to the seller, however, at any moment a buyer may come along and pay full price in which case they would be then be the buyers of the property or another higher offer may come along before I am able to reach the seller and most likely the seller will accept the higher offer." That is what I should have said to the buyer so that they are aware. A situation like this rarely happens (typically happens with 25 to 75 point listings first hit the market so if these listings are not overpriced they typically sell at asking price) Majority of time when I say this to the buyers there response is "I totally understand." Again my mistake for not sharing that with the buyer this today.

We work as a transaction broker representing both buyer and seller. We are simply trying to get the two sides to come together. It has nothing to do with time = money. The seller has listed a property and if someone comes along paying their asking price we mark the property sale pending for that buyer.

Jason Erpelding
Lic. Real Estate Broker Associate
From The Timeshare Store, Inc.®

Thanks again Jason! From a business standpoint, this makes sense and I appreciate you explaining. For anyone looking to buy resale, this is certainly helpful information.

 

[marynvince]

and honesty, integrity and doing the right thing. From my perspective here is how it should work:

Prospective buyer 1 bids x for a property, seller counters with y
Prospective buyer 2 bids z for a property, seller counters with y

Since y is the same for both prospective buyers, buyer 1 gets dibs to respond yeah or nay since they were the first interested party. The property should not go to buyer 2 just because they are faster with their email response. In a situation like this I would hope the agent would honor the order in which the bids were placed.

If Prospective buyer 3 now offers y+1, before buyers 1 or 2 have responded above, I believe that 2 options exist:
a) Buyer 1 then 2 need to respond yeah or nay to the counter offer or if the seller is unwilling to honor their counter offer then:
b) Buyer 1, then buyer 2 should have the option to match the new y+1 price.

That's my opinion as either of the prospective buyers, I would be comfortable with any of the above vs. the you snooze you lose that happened in this case to the OP.

 

[kamik86]

and honesty, integrity and doing the right thing. From my perspective here is how it should work:

Prospective buyer 1 bids x for a property, seller counters with y
Prospective buyer 2 bids z for a property, seller counters with y

Since y is the same for both prospective buyers, buyer 1 gets dibs to respond yeah or nay since they were the first interested party. The property should not go to buyer 2 just because they are faster with their email response. In a situation like this I would hope the agent would honor the order in which the bids were placed.

If Prospective buyer 3 now offers y+1, before buyers 1 or 2 have responded above, I believe that 2 options exist:
a) Buyer 1 then 2 need to respond yeah or nay to the counter offer or if the seller is unwilling to honor their counter offer then:
b) Buyer 1, then buyer 2 should have the option to match the new y+1 price.

That's my opinion as either of the prospective buyers, I would be comfortable with any of the above vs. the you snooze you lose that happened in this case to the OP.

However if I was the seller I would not be happy with that because while I'm waiting on buyer 1 and 2 to answer if they want to match y+1 buyer 3 may move on and buy something else. Then if neither 1 or 2 choose to pay y+1 I lost out on a higher sale.

 

[Splashboat]

I am wondering, however, why the first person to submit an offer is not given the opportunity to pay the full price (if they choose) when a situation like this occurs? Is it simply that time = money and once you get the asking there is no obligation to any other willing buyer(s)?

Another way to look at it is that your scenario puts the seller at a significant disadvantage. If the seller is obligated to try to negotiate for full price, another buyer who is willing to pay full price might not want to wait and move along to another listing. The seller could end up forced to take a lower offer or miss out on selling to people who are willing to pay full price. Not fair to the seller.

Sorry, I somehow missed the whole second page of this thread - didn't see that others have already made my point.

 

[marynvince]

However if I was the seller I would not be happy with that because while I'm waiting on buyer 1 and 2 to answer if they want to match y+1 buyer 3 may move on and buy something else. Then if neither 1 or 2 choose to pay y+1 I lost out on a higher sale.

There should be no/minimal waiting. Couple of phone calls: "Just wanted to let you know we've had another offer, You need to let me know one way or the other" if the prospective buyer is unable or unwilling to make a decision, at least they've had the opportunity.

 

[goldenears]

and honesty, integrity and doing the right thing. From my perspective here is how it should work:

Prospective buyer 1 bids x for a property, seller counters with y
Prospective buyer 2 bids z for a property, seller counters with y

Since y is the same for both prospective buyers, buyer 1 gets dibs to respond yeah or nay since they were the first interested party. The property should not go to buyer 2 just because they are faster with their email response. In a situation like this I would hope the agent would honor the order in which the bids were placed.

If Prospective buyer 3 now offers y+1, before buyers 1 or 2 have responded above, I believe that 2 options exist:
a) Buyer 1 then 2 need to respond yeah or nay to the counter offer or if the seller is unwilling to honor their counter offer then:
b) Buyer 1, then buyer 2 should have the option to match the new y+1 price.

That's my opinion as either of the prospective buyers, I would be comfortable with any of the above vs. the you snooze you lose that happened in this case to the OP.

From an honesty/integrity point of view, I agree with what you are saying.
However, from a business point of view, I understand why the asking price is simply accepted, regardless of whether or not there are other offers and subsequent counter offers on the table.
I think it all becomes confusing for buyers though, which is why I appreciate Jason clarifying things for us.

 

[permavac]

However if I was the seller I would not be happy with that because while I'm waiting on buyer 1 and 2 to answer if they want to match y+1 buyer 3 may move on and buy something else. Then if neither 1 or 2 choose to pay y+1 I lost out on a higher sale.

I agree with this and I do think it works best the way Jason described. There is no deal until there is a deal - especially when buyers and sellers can change their minds and you could be waiting on someone who has already moved on. If someone is calling and wants the property offered, they are not assured of getting it unless they actually take the property as offered - with no negotiating. If you are trying to get it for cheaper than asking price, you have to know that someone else may not be haggling and they will get it first. I think the common courtesy is the broker describing to the potential buyer, "As you are not making a full-priced offer I will tell you that there is the possibility of someone else coming along who does and the property will go to the person who is paying the full price or closest to full price." If I were selling, I would expect this to occur. As a buyer, I understand that this will occur. I did make a lower than listed offer on a contract through TSS and was told exactly that. Another buyer got that contract. Oh well.

Terri

 

[ELMC]

and honesty, integrity and doing the right thing. From my perspective here is how it should work:

Prospective buyer 1 bids x for a property, seller counters with y
Prospective buyer 2 bids z for a property, seller counters with y

Since y is the same for both prospective buyers, buyer 1 gets dibs to respond yeah or nay since they were the first interested party. The property should not go to buyer 2 just because they are faster with their email response. In a situation like this I would hope the agent would honor the order in which the bids were placed.

If Prospective buyer 3 now offers y+1, before buyers 1 or 2 have responded above, I believe that 2 options exist:
a) Buyer 1 then 2 need to respond yeah or nay to the counter offer or if the seller is unwilling to honor their counter offer then:
b) Buyer 1, then buyer 2 should have the option to match the new y+1 price.

That's my opinion as either of the prospective buyers, I would be comfortable with any of the above vs. the you snooze you lose that happened in this case to the OP.

The ideal situation you've described above sounds very nice if you are the first buyer. The problem is that it is disadvantageous to any buyer after buyer #1, the seller and the agent. Not to mention that it violates Florida law.

I think that a lot of the hurt feelings with this process come from a misunderstanding of how these things work. Under Florida law, timeshare brokers represent the transaction. They are not beholden to the seller or to any of the buyers. Their job is to make sure the transaction happens. That means that the first agreed upon offer is going to get the contract, regardless of when the buyer entered into the negotiations or who might be willing to pay more but just hasn't said so yet. To do what you suggested above could get the broker fined, or possibly have his license revoked.

The problem I have is that you use terms like "honesty" and "integrity" and "doing the right thing" but it seems that in order for a broker to meet these criteria they have to simply do what benefits you (buyer #1 in this case). Rules exist so that their is fairness for everyone involved in the game. It seems like in this case you want to modify the rules so that they are beneficial to only one player to the exclusion of everyone else.


More information about this particular law and how it works can be found here, if you're interested in reading legal mumbo jumbo.

http://www.leg.state.fl.us/statutes...ng=&URL=0400-0499/0475/Sections/0475.278.html

 

[marynvince]

The ideal situation you've described above sounds very nice if you are the first buyer. The problem is that it is disadvantageous to any buyer after buyer #1, the seller and the agent. Not to mention that it violates Florida law.

Read the law and I'm not seeing where this situation violates Florida law in regard to a transaction broker.

Why shouldn't the first prospective buyer hold an advantage over subsequent prospective buyers as they were in an active negotiation with the seller? If I were the seller I would have had the agent go back to the other prospective buyers in order and said: "There is a new offer on the table, If you are still interested the price is now y+1" No laws being broken here, just doing the right thing.

 

[goldenears]

The ideal situation you've described above sounds very nice if you are the first buyer. The problem is that it is disadvantageous to any buyer after buyer #1, the seller and the agent. Not to mention that it violates Florida law.

I think that a lot of the hurt feelings with this process come from a misunderstanding of how these things work. Under Florida law, timeshare brokers represent the transaction. They are not beholden to the seller or to any of the buyers. Their job is to make sure the transaction happens. That means that the first agreed upon offer is going to get the contract, regardless of when the buyer entered into the negotiations or who might be willing to pay more but just hasn't said so yet. To do what you suggested above could get the broker fined, or possibly have his license revoked.

The problem I have is that you use terms like "honesty" and "integrity" and "doing the right thing" but it seems that in order for a broker to meet these criteria they have to simply do what benefits you (buyer #1 in this case). Rules exist so that their is fairness for everyone involved in the game. It seems like in this case you want to modify the rules so that they are beneficial to only one player to the exclusion of everyone else.


More information about this particular law and how it works can be found here, if you're interested in reading legal mumbo jumbo.

http://www.leg.state.fl.us/statutes...ng=&URL=0400-0499/0475/Sections/0475.278.html

With all due respect, ELMC, I don't read marynvince's post as wanting to be beneficial to herself and I agree with the question she has raised. When someone makes an offer, it may simply be a starting point. In OP's case, the seller made them a counter offer, which is essentially a verbal contract saying they will sell it to the buyer for the counter offer price. It does not then seem ethical for the seller to then walk away before receiving an answer and accept someone else's offer. I don't see why first come first served can't apply and I don't see how this would be unfair to anyone.

 

[ELMC]

Read the law and I'm not seeing where this situation violates Florida law in regard to a transaction broker.

It violates the law because the broker's responsibility is to close the transaction. As soon as they start giving preferential treatment to specific buyers they are then acting as an agent of the buyer and not the transaction. It's a conflict of interest.

Why shouldn't the first prospective buyer hold an advantage over subsequent prospective buyers as they were in an active negotiation with the seller? If I were the seller I would have had the agent go back to the other prospective buyers in order and said: "There is a new offer on the table, If you are still interested the price is now y+1" No laws being broken here, just doing the right thing.

The reason the first prospective buyer shouldn't hold an advantage is because this is business, not the schoolyard. Calling "I saw it first" doesn't work in this case. But you do make a good point about what would happen if you were the seller. Remember, as a transaction broker, the broker is not responsible to represent the interests of any one specific buyer and they are also not responsible for getting the seller the maximum price possible. All they are responsible to do is present all offers to the seller. If I were the seller I would ask my broker to contact all interested parties to try to create a bidding war situation (something I am guessing brokers try to avoid because it can get ugly). I think we're going to have to agree to disagree on this point of what is "right".

With all due respect, ELMC, I don't read marynvince's post as wanting to be beneficial to herself and I agree with the question she has raised. When someone makes an offer, it may simply be a starting point. In OP's case, the seller made them a counter offer, which is essentially a verbal contract saying they will sell it to the buyer for the counter offer price. It does not then seem ethical for the seller to then walk away before receiving an answer and accept someone else's offer. I don't see why first come first served can't apply and I don't see how this would be unfair to anyone.

First off, I have to say that I really appreciate the tone of these conversations and the fact that we are able to disagree and be polite at the same time. I hope I wasn't being accusatory when I said that marynvince wanted the rules to benefit her, because that wasn't my intent.

Anyway, to give you my thoughts on your comments...the problem with this situation is that it isn't as cut and dry as we try to make it sound. In Mary's case, she proposes a situation where there are two buyers and the seller makes a counter offer to both. Buyer #2 accepts the counter offer but if things went the way she suggested, the seller would need to wait to hear back from Buyer #1. Let's say that it takes half a day or so to respond and Buyer #1 does not accept the counter offer. So the broker goes back to Buyer #2 who has moved on and purchased another contract. Now the seller is left either without a buyer or is forced to take a lower price. Furthermore, this adds to the time it takes for the contract to close, so the broker is not fulfilling his duties to the contract in the best way possible. This is just one example of the many things that can go wrong.

As an aside, although it sounds nice, what you are suggesting would create an extremely difficult situation for the brokers. I have been involved in bidding on a contract that had at least three bidders (but I suspect more than that). So not only does the broker have to keep track of all the bids, but they also have to track the chronology of the bidders and communicate with each of them in the proper order during every step of the offer/counter offer process. That would be completely unmanageable.

Listen, as a buyer I would love for your suggestions to be the way it is. I have done exactly what you said...offered a low starting bid in the interests of opening negotiations...only to never hear back. What has happened in the meantime was that someone else came in and made an offer higher than mine that was accepted. The broker I use was under no obligation to let me know that I was outbid, and so she didn't. I didn't get the contract. Did I feel bad about that? Sure I did. But it's the way it goes. I would much rather accept that than being denied the opportunity to purchase a contract because someone called dibs.

I guess what I'm trying to say is that I see your point, and in theory it would be a good thing...but only for buyers (specifically the first one in). It would be worse for sellers, worse for brokers, and I'm not even sure it would work in real life the way it has been laid out here in theory.

But as always, I could be wrong. Thanks for your thoughts!

 

[marynvince]

Thanks for replies and it's actually the Vince in the marynvince that is the poster here. I am a big fan of dibs as well as calling shotgun when I'm out with my buddies.

While I've been a proponent of the dibs argument for this discussion, i would be more in favor of the bidding war. Give everyone interested an equal opportunity, not just the last guy as was the case with the OP.

I do believe an agent could manage the process better by making timely phone calls...emails is easier and often the path(of least resistance) taken.

 

[goldenears]

First off, I have to say that I really appreciate the tone of these conversations and the fact that we are able to disagree and be polite at the same time.

I absolutely agree! I understand that what you and Jason are saying is the way that it is done and I appreciate you making this clear for anyone wishing to buy resale.

 

[Deb & Bill]

Maybe it is turning back into a seller's market from a buyer's market.

 

[RayJay]

Maybe it is turning back into a seller's market from a buyer's market.

Yikes, I just said this in the other thread, that is what a broker told me last week.

RayJay

 

[LisaS]

As an aside, although it sounds nice, what you are suggesting would create an extremely difficult situation for the brokers. I have been involved in bidding on a contract that had at least three bidders (but I suspect more than that). So not only does the broker have to keep track of all the bids, but they also have to track the chronology of the bidders and communicate with each of them in the proper order during every step of the offer/counter offer process. That would be completely unmanageable.

I agree. An additional complication is that the contract could be listed with multiple brokers. If offers are coming in through more than one broker, would they be obligated to check in with each other, produce a combined list of bidders in chronological order, and then keep that list updated as offers and counter-offers are made? That is too much overhead for something that should be pretty straightforward. If you really want the contract, offer the seller a reasonable price. If you want to try to negotiate a better deal, then you must accept the possibility that someone else will outbid you and you will have to start over. Until there is an agreement on both sides, there is no deal and the seller should be allowed to accept a higher offer.

I don't agree with the idea that the first person to make an offer has "dibs". It wouldn't be fair to allow a potential buyer to make a lowball offer that, until it is officially withdrawn, prevents the seller from knowing about or accepting higher offers. Imagine if you were desperate to sell and your contract was held hostage by someone trying to force you into accepting a lowball offer because you couldn't afford to wait it out until they withdrew.