A lot of people wonder what we do to earn our commissions in a multiple offer situation; after all, the property has sold quickly, often without even an Open House.
Here’s a brief summary of what goes on the day of a multiple offer situation.
We’ve done our market analysis, met with our sellers, prepared the paperwork to list, perhaps staged the property or stickhandled trades, taken photos, loaded the listing, set up the property instructions and then – bam, suddenly there are dozens of showing requests and it looks like we are heading into multiple offers.
We make note of who has requested showings. As soon as the first offer comes in, we notify our clients (sellers) that we have received an offer . Then we notify all the agents who have expressed interest in the property that we have an offer and when they need to get in an offer (this can be either before the irrevocable period on the first offer expires, or it can be the time we’ve set for presentation, whichever is earlier).
When the second offer arrives, we have to do the same thing. I had 28 agents interested in my recent listing on Echo Drive, so I put together a table with each of their names, brokerage info, contact numbers etc as well as an email list. Each time an offer came in (there were eleven in total), I had to send out that notification email to all of them.
Meanwhile, we answer calls from agents who have questions: Is there asbestos in the property? Is there UFFI? What kind of plumbing is there? and so on. Often it can be chaotic. I fielded some 400 emails over the two days that the property was on the market (there were 30 showings), and dozens of calls.
That included one from a gentleman who was angry with me because I told him I don’t double-end. He wanted to put in an offer, so I arranged to refer him to an agent who could represent him. It’s so important in a multiple offer situation to have that independent advice from your own realtor: remember, I act for the sellers; I can’t advise you on price. I also know what offers are coming in. It would be totally unfair to other prospective buyers for me to represent a buyer of my own: I simply don’t do it. (As it turned out, he didn’t follow through with the other agent but called me again the next day to again ask me to submit an offer on his behalf, and once again I declined.)
Once I had all the offers in hand, I completed the table I’d created to indicate the name of the buyer, offer price, deposit, closing date and conditions as well as the name of the agent. I arranged to meet my clients (sellers) and sent them copies of all the offers, which I also printed off, along with the table.
We then met to go through the offers in order that they had been received. Some were easy for my clients to turn down compared to the others, and in this situation, there can only be one successful bid. I had them write on each rejected offer p. 1 that “offer was presented on X time and date, respectfully declined” and then sign that.
Once we settled on the successful bid, we signed up that paperwork. Then I headed back to the office to notify the agents who had submitted bids of the outcome.
Each rejected offer has to be uploaded into our office system so that was 10 of them that needed to be scanned and uploaded. The accepted offer has to be dealt with as well: we have to update the MLS listing to show that the property has been sold or conditionally sold, depending on what applies, the price, the firm date (when conditions will be removed) and the closing date as well as the name of the agent who brought the successful offer.
In our internal system, we have to upload not just the rejected offers but the successful one and update our system with the same information as well as what conditions apply, if any, name of lawyers, buyer, seller, what the commission split is, and upload the documents. FINTRAC forms establishing that we have verified the identity of the parties and their occupations are also required to be completed and uploaded on both sides of the transaction.
Just because the deal has been signed doesn’t mean the work is over. I have to send copies of the paperwork to the seller’s lawyer and follow up with the buyer’s agent to make sure I get the deposit. I have to follow up on any conditions to make sure they are removed when they are supposed to be, and of course, keep the client in the loop as to progress.
With 11 offers to deal with, I worked from 7 AM to 11:30 PM from the time the property hit the market until I was done with these tasks. I tell my clients, it’s like synchronized swimming: you see what’s going on above the water but below the surface, there is a lot of frenzied activity!