Homebuyers have the clout and motivation money can’t buy

Q: We receive lots of offers on our rental property. Say half are from business types such as flippers, landlords and builders. The listing agent we hired is really pushing for the local flipper to purchase the property. We can’t tell who is really the buyer when the purchase offer lists a corporation. Nonetheless, this once was our parents’ home and our agent knows full well we all would like to see a family purchase the property. So why is our listing agent so adamant we choose a lower offer from one of the business entities? Something is amiss, and we want to know what gives before moving forward.

A: Some residential agents look at so-called cash offers or large down payments from business types as a quicker payday. Others see these kinds of enterprising buyers who have no plans to live in the home as strong buyers who can “close the deal.” What the agents don’t know is that someone who is not planning to live in the home has less motivation, not more. These tight-fisted businesspeople are also ready, willing and able to renegotiate, default, disappear or cancel. As a rule, they don’t care about you, your family or the home. They care about making a profit. In order to do so, they need to buy low or following a sale that’s ratified, renegotiate after the “lightning in a bottle” of multiple offers has flickered out. Speaking of “they,” I’ve had agents not be able to tell me who is in the corporation listed on the purchase offer. A business search on the secretary of state’s website (http://www.sos.ca.gov) will inform you who is in the corporation. To make matters worse, agents often have buyers and sellers sign an offer from a corporation without an Additional Signature Addendum (ASA form) from the California Association of Realtors. Meaning, they are cementing the fact that they did not verify if the person signing the offer for the corporation has any authority. Granted, many corporate homebuyers are legit. Regardless, if a dispute breaks out, the home seller has everything on the line. Conversely, the partnership of entrepreneurial buyers created a corporation ensuring they wouldn’t.