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Rules for Offers Made to Licensees in Alabama Real Estate

Instructor: Tara Schofield

Tara has a PhD in Marketing & Management

How do you handle an offer for your listing? Learn what an offer is, how to handle it, and what requirements are placed by the Alabama Real Estate Commission.

What is an Offer?

You are a real estate agent with a client looking to buy a home. They have looked at several homes and finally found one that interested them. They want to make an offer, a proposal to buy a home from a seller.

They feel the home is overpriced at $500,000 and wants to offer $460,000, closing in 30 days. You feel this may be a little low but is still reasonable. You meet with your clients to get their signature on a written offer that you will submit to the seller's agent, Rick, immediately.

The Agent's Role in an Offer

You let Rick know you are sending over a written offer for his listing today. You mention that it expires in 24 hours and explain you are looking forward to hearing back.

Had you made the offer verbally, Rick may have said it was too low and asked you to go back to your clients for a higher offer before presenting it to his. However, because it is in writing, Rick must present it to the sellers as it is presently prepared. The seller has the right to accept, reject, or counter the offer.

If the sellers reject your clients' offer, Rick is not required to get back to you, as the offer has a condition to expire if he doesn't reply within the stated 24 hours. As a courtesy, Rick knows it is professional to respond to you and let you know the sellers are not accepting and do not want to counter.

If the seller counteroffers, Rick will submit a written offer to you that you must present to your buyers. While it is common for counteroffers to be made verbally, it is in the best interest of your clients to keep all offers in writing.

Therefore, you ask Rick to send the signed offer over for you to present to your clients. When the offer comes back, your buyers agree to the $485,000 sales price proposed by the sellers' counteroffer.

Violating the Rules Regarding Offers

Verbal offers do not have to be presented to your clients, although you may choose to present those offers if they are reasonable. Written offers must be presented. You cannot withhold an offer based on your opinions of the amount, the terms, or any bias towards the potential buyer.

What happens if you receive a written offer that is ridiculously low and you are certain your client will be annoyed if you tell them? It doesn't matter, you still must show the offer to your client. If you do not, you are in violation of Alabama Real Estate Commission laws and can face fines or penalties for not fairly representing your clients.

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