Controlling the Date of Ratification
It’s the attention to detail, knowledge of the contract and control of a situation that combine to make an ordinary real estate agent, GREAT. Case in point, the very important detail of when a contract is ratified. Once a contract is ratified, sellers are contractually obligated to sell with only the right to say no in the face of requests by the buyer. Buyers, however, can void the contract under a number of different contingencies like HOA document review and home inspection. Makes it pretty important to know WHEN a seller is officially ratified.
The Northern Virginia Residential Sales Contract defines Date of Ratification as “date of Delivery of the final acceptance in writing by Buyer and Seller of all the terms of this Contract to Buyer and Seller.”
In my fifteen plus career of selling real estate, I have never left ratification date up to chance when representing a seller who would be last to sign. No way. There have been a handful of occasions where a better offer came in and if I had not been in control of delivering that final acceptance to the first buyer in and it was something that happened through an automated program like, say, Dot Loop, well, my sellers would be stuck in that first deal. In those cases, I hold that final acceptance back until my sellers are satisfied that they have done their best.
Not all agents work this way and some value convenience over the duty of representing their seller’s best interest. Today, when I left feedback for a listing agent that my buyer was interested in making an offer, he called to inform me, “My seller is ratifying an offer now.”
Based on the definition above, “ratifying now” could mean she is signing the offer, but that doesn’t mean it has been delivered to the other side yet. Just expressing this, you could hear the listing agent’s stomach pull up in his throat. He asked, though I’m sure he didn’t want to hear the answer. “What does your buyer want to offer? We’ve got a little less than list price and a low down payment buyer now.”
My buyer was a 20% down payment, conventional loan buyer willing to even give a $6,000 low appraisal guarantee.
You could hear the smoke pouring from the listing agent’s ears. He didn’t know what to do. What he HAD done was set up DotLoop to automatically send the seller’s signed acceptance directly to the buyer’s agent, which made it automatically ratified. That little bit of convenience probably cost his seller $6,000-$10,000 today. Whoops.
Hiring the right listing agent to represent your best interests is nothing to take lightly. The devil is always in the details. The best listing agents know this. Delivering a signed, seller accepted contract, making it ratified, is akin to looking both ways before crossing the street. Today, I played the part of the bus that hit this listing agent that crossed the street without looking. Too bad. Nonetheless, his seller is under contract…just for a lot less than she would have been with my buyer.