There are several things to check under STATUS in our MLS that covers most of the state of Arkansas.
- Under contract
- Under contract before listing
- TBU for Take Backup Offers
- Price Change
- Back on Market
- ESCAPE CLAUSE
These options should be used and used truthfully. If we are going to show property, we don't need to have to hunt down the listing agent to make sure there are no hidden contracts. It seems to be common in our area to hide the ones that should be marked "escape clause". They will still show up as "active" in the MLS data and if we see the mark "escape clause" we know there is something that we need to check on.
Escape clause means that someone has a contingency offer on a house. The contingency is usually that they have to sell their house to buy or any thing other than financing. The listing agent who allows the contingency contract to be put on the house wants it to be "secret" because if the agents know it, they won't show it!
What kind of thinking is this???? And how is that fair to me???? They want to trick me and other agents into showing the house???? Then if we work all weekend trying to sell it to a buyer who wants to buy that weekend we find out that there is a contract????
The proper thing to do is check "escape clause" because that tells me that there is something there but it can possibly be broken. The contract makes a fairly long process of removing the escape clause and if the buyer is so willing, he can remove the contingency of selling his house but not the one of financing and he could hold onto the house, cause the homeowner to lose the new buyer, and still not be able to buy it because he can't get financing!
Are you listing agents who allow the contingency clause fully explaining this to the seller. I worry that you are saying instead that "We'll just keep this in our files and the agents will still show your house because they won't know there is a contingency clause. If we get another offer, we'll ask the buyer to remove the contingency."
That brings up the question of whether the selling agent, who often is the buyer's representative only, has the responsibility to tell that buyer what he can do. It may be dirty pool but if the buyer REALLY wants that house and REALLY wants to hold onto it, should the agent tell him how to hold onto it? All that buyer possibly has to do is remove the contingency of selling his house and if he can't get financing he still does not have to buy it and can probably get any earnest money returned.
And this would be after they assured the poor seller that he can still sell his house because agents will still show it. That is another good reason why I don't want to work around contingencies BUT I want to make my own decisions about showing and not be TRICKED into showing it.
Then there is the listing agent who tells the seller that when he gets another offer, the first buyer will remove his contingency and proceed to buy it. They are USING the second buyer to urge the first buyer to act! That is also what I call "dirty pool". We all need to be aware of where those contingency contracts are and they need to be marked as such in our MLS.