Why the Deadline?
Why as listing agents do we say that offers are to be submitted by a specific date and time? Does that mean your seller will not accept an offer before that cut-off? Does it mean that at the designated hour the seller will accept the highest/best offer without further negotiation?
The deadline concept was born prior to this market and for the situations where we knew multiple offers were forthcoming. By putting the competitors in a do-or-die mindset, we had our buyers go big to the extent possible. Who knew what cards other buyers were holding, so if you really want the prize you’ve got to go big.
Today, are there buyers who don’t know that they’ve got to go big? Big dollars-great terms-quickly submitted is the order of the day. So, listing agents, I ask again, why impose a deadline? Do you want buyers to think there’s no urgency in making an offer as long as it beats the deadline? Does your seller need more market time in order to get that great offer? Perhaps your seller just wants more buyers traipsing through her house.
And what if that spectacular offer comes in before the deadline, the one way up in the stratosphere that allows the sellers to remain in possession for as long as they need? That offer, like any others received before the deadline, must be submitted to your client in a “timely manner” as per the Real Estate Licensing and Registration Act, section 606.1(a)(3) [Note: If you want to know what a “timely manner” is, drag your feet and hire me to represent you before the Real Estate Commission, where we’ll get an answer.] And what seller will resist peeking at an offer you’ve delivered despite her promise to not peek before the deadline?
And if that great early-bird offer has life span ending before the deadline………. then what? It’s likely that your seller will do what makes sense by signing and having you deliver the executed agreement to the buyer’s agent. To the other agents who deliver offers at the deadline, the listing agent will say what, it sold, too late, the seller couldn’t wait? Some may claim the listing agent flat out lied. And does it matter that the agent never said that the seller wouldn’t jump the gun or that as the seller’s agent he had no choice but to follow his client’s directive?
Many of you have plenty of answers to these questions and those unasked. Yes, shorten the deadline, but if the seller doesn’t accept one in that window buyer agents who complied think you’ve lied or are being unfair. You could qualify the deadline with fine print: “Seller reserves the right to ignore the deadline” Or, you could even enter a written agreement with your seller that if you impose a deadline, she will not accept an offer prior to its expiration. Really?
I acknowledge that deadlines can work, or at least not create disasters. But I must be missing something in thinking that they don’t do anything more helpful than saying the property will sell quickly, get your best offer to me now. And isn’t that a given?
And while I’m already blue in the face, allow this favorite rant of mine (it too involves deadlines): why do we give five days for deposits? I’ve got the cases, the ones where the buyer backs out before tendering the deposit (or has stopped payment after tender) and where that deposit ($0.00) represents the seller’s sole remedy. You’ve probably not had that happen but if it does, will your seller, now unable to settle on his purchase, be ok. More likely, this will be the first time the seller learns the significance of liquidated damages, or that he could have waited to accept the offer after delivery of the deposit!
As always, share your thoughts and suggestions! Happy summer.
