Attorney Bruce Aydt, ABR, CRB, SRS, is a national real estate educator, a Missouri real estate broker, and past chair of the National Association of REALTORS® Professional Standards Committee.
Be Open About Other Offers
Telling buyers about competing offers can prevent unpleasant surprises.
October 1, 2008
Q: I presented an offer from my buyer to a listing agent and asked whether there were any other offers for the property. The listing agent informed me that there was another offer. I wanted to know if the other offer was from a prospect of the listing agent. She said she didn’t have to disclose this. Did I have the right to know if the second offer was written by the listing agent?
A: Yes, you did, assuming the seller had authorized the listing agent to disclose the existence and source of other offers to buyers and cooperating brokers. Standard of Practice 1-15 was amended in 2006 to require listing brokers to make such disclosures, when authorized by sellers, in response to questions from buyers of cooperating brokers.
Standard of Practice 1-15 provides that "REALTORS®, in response to inquiries from buyers or cooperating brokers shall, with the sellers’ approval, disclose the existence of offers on the property. Where disclosure is authorized, REALTORS®, shall also disclose [when asked] whether offers were obtained by the listing licensee, another licensee in the listing firm, or by a cooperating broker."
The listing agent informed you there was another offer. Assuming she was authorized by the seller to provide you with this information, Standard of Practice 1-15 also required that she disclose the source of the other offer, since you asked. The listing agent’s failure to make this disclosure when asked violates Article 1 of the Code as interpreted by Standard of Practice 1-15.