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A seller's agent is obligated to represent the seller's interest
By Edith Lank | Columnist
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Published: 7/24/2010 11:31 PM

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Q. My fiance and I signed a purchase contract. Five days later, the inspection determined the house needed a new roof immediately. Our contract gave us the right to back out if we weren't satisfied with the inspection. The seller offered to pay just $500 toward the cost of the roof. We said we'd take the weekend to think about it. Before all that, a friend of ours had seen the house himself. Now, he told us the selling agent called him to say our deal had fallen through and asked if he was still interested. Our friend understandably wanted to know why our deposit had fallen through, except it hadn't.

We ended up paying the original amount less $500 toward a new roof, out of fear of losing the house. We do feel, however, that we were backed into taking this counteroffer and that the right to any further negotiations or another counteroffer were taken away from us. My question is, was it fair play for the selling agent to contact someone else in the first place? What are our options at this point?

A. A seller's agent is required by law to put the seller's interests first. With your deal possibly falling through, the broker was acting properly. He was investigating other interested parties so no time would be lost if you did drop out. It would be wrong, of course, if he lied to your friend, but perhaps he said something along the lines of "it's possible the house may come back on the market."

As for further negotiations being "taken away" from you - not so. You were not manipulated. The agent didn't threaten you with other possible buyers. If the friend hadn't contacted you, you wouldn't have even known that he'd been approached. You could still have made a counteroffer if you chose to, knowing that if it was rejected, you had no enforceable deal. That would be true whether or not your friend was involved. Until a final binding contract is signed by everyone, it's always possible other buyers may show up.

My ex-husband paid off my mortgage, but I've never received any documentation to show that this has been done. Now that I'm getting the house ready to sell, will this lack of documentation be a problem? If so, who do I contact to get the "paid in full" statement?

A. Contact your county's public records office. It's possible the records already show the payoff ("satisfaction" or "reconveyance deed"). If so, everything's fine and it won't matter whether you have the document or not. But if the records still show a large debt out against your property, nobody in their right mind would agree to take it over. No lender would give would-be buyers a new loan, either. So yes, the matter will have to be cleared up sooner or later.

In that case, if you know what mortgage company received that last payment, contact them immediately. If you don't get any satisfaction, write to the CEO of the company and complain to the agency that regulates mortgages in your state (a librarian can help you find the phone numbers and addresses). If that doesn't work, contact a lawyer, preferably one who specializes in real estate. There are fairly straightforward ways to solve the problem, but they do require some legal action.

My husband and I are considering buying our first home. How do we begin?

A. This is a great time to buy. Prices in most areas are more affordable than in the past, and mortgage interest rates haven't been this low in decades. Start by visiting a mortgage broker or going directly to a local lender in order to apply for preapproval on a mortgage loan. You'll pay some fees, but you'll come out with a binding promise for a loan for a certain amount, dependent only on an appraiser later reporting the property is worth it. With that in hand, you'll be strong buyers and welcome to sellers because they know you won't have any trouble arranging financing. You needn't reveal the exact amount you could borrow, and you won't have to spend that much if you prefer not to.

Meanwhile, search the Internet, answer ads and visit open houses in areas that interest you. At open houses, most agents who are not busy will sit down and discuss your situation. You may meet a broker you feel comfortable about working with that way. Or you can just walk into local real estate offices and ask for financial analysis and advice. It won't cost anything or obligate you, and you may find the right agent while you're there.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (please include a stamped return envelope), or readers may e-mail her at

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