Hello everyone and welcome to another episode of Selling Greenville your favorite real estate podcast here in Greenville South Carolina I am your host as always Stan McCune and I'm a realtor right here in Greenville you can find all of my contact information in the show notes if you need a realtor in this area or outside this area I can help you understand Greenville when I say Greenville we're talking about the upstate right Greenville is just the main city of the upstate the main county of the upstate there are many counties fact that I recently had to drive two hours between showings in multiple different counties so that was fun and that's sometimes what happens we have to have kind of a broad area in just the way this market is the way the Greenville specific market is so anyway my contact info is in the show notes if you need a realtor in this area and just take a second to like the show if you're on YouTube to subscribe to future episodes hit the little subscribe button whatever platform you're on if you can leave a rating or a review I would appreciate that as well today we're going to be talking about real estate schemes that you need to look out for and when I say schemes I'm not necessarily talking about things that are illegal or even inherently unethical so I want to make that very very clear because there might be depending on who listens to this or watches this some people might think that that I'm calling them out I'm and I'm not gonna name names or anything like that but I'm not calling out anyone just to be clear these are just these are practices that are fairly common and sometimes the general public doesn't exactly know what's going on when it comes to these real estate schemes and these schemes are Greenville specific I wanna make that clear as well some of these might be in some other markets I'm not saying that they're not in other markets but this is a Greenville show and some of these things might not pertain to other areas so I just wanna make sure that you guys know that but if you're someone that's listening and you're looking to buy or sell a home at some point in the near future in this area you need to be aware that there are some things that that are that's being done right now in the real estate world in this area that can sometimes catch people off guard or they don't fully understand it and in some cases it is illegal or unethical what is happening in other cases it's just that realtors or other people practice real estate a certain way and have certain things that they do and maybe their system is not in the best interest of their clients which is fundamentally in in my opinion not right and they would argue they would say no this is in the best interest of my clients but I'm gonna build a case here for why it in some of these instances may not be and again a lot of it comes down to before I get into the specifics I'm gonna go through 10 real estate schemes here a lot of what I'm gonna get into again the schemes themselves aren't necessarily wrong a lot of it comes down to how it's explained to the public and I've noticed very frequently that things are not explained well in fact the Real Estate Commission has noticed this as well and has started to crack down on some of these things alright so with all of that in mind let's talk about the very first scheme and the very first scheme that I wanna talk about here is Realtors that put something to the effect of this in in the in the remarks specifically what we call these syndication remarks these are the remarks the notes on the listing that are sent out to other websites and some websites only pull the these notes like I believe realtor.com only pulls from the syndication notes it does not pull syndication remarks it does not pull from the other remarks okay and so what you put in there on some websites is the only thing that is out there and here's what I found is that there are instances where people will put in the standard remarks the description of the home and then in the syndication remarks they will put this listing is presented by XYZ Realtor or XYZ brokerage without any description about the property at all so what happens when people go to look up that property on realtor.com or an or a comparable website that only pulls from the syndication remarks they're not going to find the description of the property all that they're going to find is this listing is presented by xyz brokerage or by XYZ Realtor or by XYZ team whatever whoever you want to put in there is that in the best interest of the seller or even of buyers out there in the market that there is no description all that there is a way to get in contact and there's always a phone number in there a way to get in contact with the listing agent you know what that scheme is that is a scheme for the listing agent to try to get more business they're trying to get buyers to come and call them for in information regarding the property for showings etcetera that's the reason why they're doing that like don't let's be honest that's exactly what's happening there and I'm sure that the that the people that do this you know what their explanation would be is well if they call me versus calling someone else I represent you so this is in your best interest but if there's no listing description that they can look at very easily they might not even call that agent right they don't have the information the information that they need on the listing in order to place that phone call and again I'm not saying it's wrong there there's nothing illegal there's nothing inherently unethical about doing that the syndication remarks are the place to put the contact information for the realtor we they don't allow you to put it in the standard remarks so there's nothing wrong about doing that the question is it in the best interest of the seller and I think more often than not it it's not in the best interest of the seller you want to those listing descriptions are important I use my listing descriptions to explain things that you can't obviously see in the photos or to add color to what's there in the photos and so yeah if I were to just put this listing is presented by Stan McCune and then my phone number I could not do that with a clear conscience me personally I don't feel like that that is the best thing for my clients so be aware of that No. 2 on here we buy houses we've talked about this before but it's been a minute I feel like it's worth bringing this one back up you see the signs all over the place we buy houses there's all the websites out there we buy houses here's what you need to be aware of with the we buy houses people they usually don't buy houses ha almost none of them that that put those bandit signs up actually buy house you know what they're doing they're wholesaling and wholesaling in the state of South Carolina is now illegal what is wholesaling is when you get a property under contract generally speaking you get a property under contract and then you market that contract to other potential investors with a markup right so you might get it under contract for 100,000 and then you reach out to other investors and try to sell it to them for 150,000 but you don't own the property yet and that therein lies the rub the state of South Carolina requires you to if you're going to market a property you have to either have a listing agreement with a you have to be a realtor that has a ratified listing agreement with the seller or you have to own the property this is the only two ways to market a property for sale wholesalers don't do either of those things the we buy houses people they're not doing either of those things what they're doing is they're getting a property under contract and then in some cases unbeknownst to the seller then marketing that contract for a for a markup you have to be super duper careful when it comes to this kind of stuff I've known a lot of wholesalers over the years they a lot of them you know when they used to do wholesaling did it the right way but there's still a lot of people out there that are that are putting up those we buy houses signs and websites and what not and they are doing this and it's illegal the this one is very much illegal if they have no intention to buy the property now what they could do theoretically that would be okay at least the way I understand the law talk to an attorney if you wanna fully understand this let's say that they go into a property with you know they get a property under contract and then they have a realtor do a CMA for them or they have you know a contractor walk the property to provide for them a quote and then that realtor or the contractor makes an offer on the property and says you know what actually I want to buy this I think that that would probably be okay because you're not marketing the property and then you know at that point you negotiate and then they can still assign that contract for a markup to the end buyer but the core thing is that they were never marketing that contract to those people they were just involving those people in order to try to better you know understand what they are purchasing as part of their due diligence but if they never ever had the plan to purchase the property that's a problem and that's a scheme that is still happening all around the place right now and people need to be aware of that number three on this list brokerage exclusive listings now this one this this is gonna be a controversial one OK because first off brokerage exclusive listings they they're very common in fact I do them sometimes and there is nothing inherently illegal or unethical about them what they are is they're basically if I take a listing I can choose to not put it on the MLS of course the seller has to agree to that we can choose to only market it basically within my brokerage okay now that might sound probably if you're if you're not aware of brokerage exclusive listings you're probably immediately like well that sounds awful why would I want to do that instead of putting it out there for the entire market why would I only want your firm to look at it that's a very very good question and there are some instances there's actually a big debate amongst realtors a big divide between realtors that work for big companies and realtors that are either you know owner operators of their own company or work for a small company big debates over whether these brokerage exclusive listings should even be legal or not I think they should be granted I'm with a bigger company and so you know we have more of these we this benefits my clients whereas it you know for it for me to have buyer clients it's beneficial that I work for a big company and we get some of these brokers exclusive listings and I've had multiple closings over the years where clients get these properties sometimes you can get them without having all the competition from the from the rest of the market that can be a great win for sellers it can be a win because maybe you know they do it off the MLS first while they're kind of getting the property ready and maybe they can get it under contract without even having to do all the work to get the property you know ready for photos and all of that that's great maybe it's a a seller that wants to you know like a celebrity or something like that that that they don't want their property their photos and whatnot to be out there on the internet it's great for that it's great for a variety of things like that investment properties right property that that is in like foreclosure well maybe not in foreclosure but a property that's in disrepair right sometimes brokerage exclusive listings can be great for that because you can kind of narrow I it can allow the realtor to market it to investor specific realtors versus putting it out there and having all of these agents from that are untrained looking at looking at a property that that needs a lot of work the thing is okay and here's where it's a scheme to be on the lookout for is that a lot of agents will do this specifically especially if they are the broker of their company or the owner of the company whatever they will do brokerage exclusive listings just so that they can try to represent both sides of the party both sides of the transaction both buyer and seller or at least so they can get their firm to represent both sides and if that's the only reason there's no benefit to the seller that's a problem and that's something that you need to be aware of you need to fully before you agree to broker's exclusive listing you need to be fully aware of the pros and cons of doing so in fact the Real Estate Commission recently produced a guidance letter and a form that they want people to be signing now for broker exclusive listings that really breaks down how you know this might not be in your best interest you need to be aware that that only exposing your home to a small portion of the market might not get you the highest price etcetera I'm paraphrasing but yeah the Real Estate Commission is obviously concerned about it and that's why they are producing these letters and I suspect there will be more reform at some point within the realtor association with regard to brokerage exclusive listings but for now they they're here it's a good mechanism in certain instances I would not say that every single listing should have them No. 4 and this is one that frequently happens in like open house situations or other kinds of situations but when a realtor convinces a non client who is interested in said Realtor's listing to quickly sign a buyer agency agreement for them to represent them before putting an offer on the listing that honestly it is not it's not technically illegal but it's definitely unethical and I've heard people talk about this before so you know imagine I'll just paint the picture here imagine you're an unrepresented buyer you don't have an agent you walk into an open house you meet the listing agent you love the house you say I want to put an offer on the house what that agent should do is say well I represent the seller you need to be aware of that you have the option to take a buyer agent if you want but because I represent the seller I can't suddenly now bring you on board and now operate as a dual agent what they can do is they can work as what we call a transaction broker with the buyer which basically the buyer maintains their unrepresented status they're not represented by that realtor but the realtor the listing agent can write up offers for them can show the house to them etcetera on behalf of the seller but they have to give the buyer the opportunity to hire a buyer agent if that listing agent then bring basically then makes that buyer their client and then competes with the seller that's not in in their seller's best interest right they have just functionally broken their fiduciary relationship with their seller by doing that that's a problem and trust me this is something that happens very very often now what I'm not saying that oh the listing agent can't do I'm not saying the listing agent can't bring that buyer on as a client I'm just saying if the only reason they're bringing that buyer on as a client and so that they can represent both sides of a transaction they're not actually going to show that buyer any other homes that's an unethical that's unethical behavior and that's something that a realtor could theoretically get in trouble for in fact some agencies some brokerages in our area don't even allow dual agency at all my company does but we have to have a pre existing relationship with the buyer in other words the buyer let's say that I have a buyer client that's interested in one of my listings I can represent them I was working with that buyer client before I got the listing right and so that's a different situation all together but to for me to meet a buyer because I have a listing and then to quickly have them sign that agreement that's a scheme that you need to look out for and it's not a good one it's not a good one the buyer should remain unrepresented or should find another agent No. 5 on here sending a multiple listing change form instead of a release of listing okay this is gonna if you're not a realtor you're gonna be like what let's say that you have your home listed let's say I have I'm listing your home for you say Stan I wanna take my home off the market okay technically that listing agreement is a contract okay and so both parties have to agree to that in fact the in many instances the broker over the office depending on how the listing agreement is worded the broker may have to sign for you to release that listing however what happens in some instances is some agents will actually send an MLS change form taking the home off the MLS but not releasing the listing okay and so what that does is that changes it we just talked about these brokerage exclusive listings that's what's happening there is they are basically taking it from the MLS and making it now brokerage exclusive so that their office still has the listing it it's just not being marketed to anyone that one again there's nothing illegal about that and if the request of the seller was to do that there's also nothing unethical about it where I've seen it be unethical in my opinion and I believe in the an attorney would also agree with me on this is when the seller doesn't know when the seller actually just wants to be released the listing they no longer want to sell their home and they think that they have ended terminated their listing but in reality the listing is still active with the brokerage and I've seen this happen before and that is something you it's a sneaky thing right because you've signed something it appears that you've taken it off the market all of that but you haven't you've only taken off of the MLS be very very aware and be very very clear when you're talking to your agent you know what it is that you're trying to do and similarly No. 6 here you need to be looking out for situations where there is a client agreement being terminated without paperwork and here's what often times will happen here you'll have let's say that that you're a buyer you're working with a buyer agent and the buyer agent is you know part time for instance and you know their schedule just doesn't allow for them to be available when you need them I'm just throwing that out there that's this is not an example not pulling that example from a recent experience or anything like that I'm just making that one up and so you say you know what it it's really best for us to I really need another agent you know that's available during business hours or whatever you're not available during business hours because you work a different job you're a part time realtor can I can we move on from working together can I find someone that's full time agent says yep no problem go ahead this you know use this email as confirmation that we have terminated our agreement that is not a proper termination of the agreement that doesn't work you can't just send an email and undo a contract contracts don't work that way in a buyer agency agreement any sort of a realtor representation agreement whether it's a buyer agency agreement or a listing agreement to sell a home those are contracts between you and not just the agent okay this is very important it's actually not a contract with the agent at all the agent is representing the brokerage that they work for so it's actually a contract between you and the brokerage the agent cannot on behalf of the brokerage send out an email that terminates that contract that is not legal okay that's not how this works and so you could actually be on the hook for owing the brokerage a commission in that instance you go and sign on with another realtor you still have an active contract to be represented by a realtor with another brokerage you could owe two commissions okay you don't wanna do that and I have seen this many times I've had many instances where people have come to me where they were working with an agent they couldn't they no longer want to for whatever reason and the agent just doesn't want to do the paperwork to terminate the contract for whatever reason maybe they don't think it's necessary maybe they're still trying to like hang on for dear life to that client I don't know like whatever the case may be you've got to get that agreement that contract terminated in writing not in an email with signatures okay what signatures docu sign dot loop whatever it's got to be done that way so that's a that's a big one that that I see quite a bit and that's definitely a scheme to look out for No. 7 this is gonna be another controversial one listing a home initially as temporarily off the market before switching it to active status later alright this is another in the weeds one and this one is again a a great area where it's not always unethical it's not always against the seller's best interest but in some instances it is here's what's going on here we have a a status in the multiple listing service called temporarily off the market we call it as Realtors t 0 OK you can take a home t 0 like let's just say that you've got your home listed and you know we're about to enter the holiday season and you're just like you know what I still wanna sell my home and I still want people to know that I want to sell my home I just don't want to have I have family coming over for the holidays and what not I can't be doing showings can we just take it temporarily off the market for a couple of weeks to get through the holiday season absolutely that's where the MLS change form that we just talked about comes into play you can change it from active to and then after the holiday season is up you can change it back from to back to active here's what some agents do because currently which may change in the near future but currently we don't have a coming soon status okay coming son's are likely to happen in different pockets of South Carolina where previously they weren't because there's a lot of there's a lot of stuff in the backdrop with Zillow and Redfin and homes.com and what not having these pre marketing options I'm not gonna get into all of that right now but what people have been doing as a workaround for coming soon is listing a home as temporarily off the market so that it shows up in the multiple Listing service it shows up on websites as you know with all the photos with the description with everything but it's not active okay here's the tricky thing you can't show a home that's in t 0 status additionally some of the market doesn't know what temporarily off even is right everyone knows what coming soon is but to list something as temporarily off like not every buyer understands they're they pull it up and they're just like okay it looks like this home just came on the market but it's saying it's temporarily off the market like what's going on there I don't think often times that that's in the best interest of the seller it's sending out mixed signals it can look like maybe there's something wrong with the property because sometimes t 0 status is people are trying to fix up a property as well like that could be a reason why you have to take it off the market and so it's very confusing and then it opens the door for unethical behavior as well because you can't legally according or according to MLS rules you can't show the house while it's in to status well what happens if someone calls up the agent and says hey I want to look at the house technically that agent's not supposed to show it to him are they doing it hmm some might and guess what this is another way for the agent to collect more buyer leads are you seeing are you sensing a theme here with some of these that it's not about the seller's best interest in some of these instances that it often times it can be about the listing agent or the listing brokerage's best interest and that's why you need to be aware you need to ask questions about like OK but what if people think this or what if people think that do the pros outweigh the cons here especially when the only very obvious pro is to the company that has the home listed and so be aware of that that one that one's probably the most controversial one on here right because some people because we don't have that coming soon status at the moment and this is you know it can help a seller in theory you know you can maybe generate buzz ahead of time but again it's confusing it's sending out mixed signals I would be very very wary of that when I do it you know if I have a client that's just like hey I really want to put this out there and kind of you know do kind of a coming soon kind of kind of concept this is really the best way to do that you can also do it as brokerage exclusive and start pre marketing it to your firm that's another way to do that that's another way that the brokerage exclusive listings can be useful but some people some people abuse these things and just do it for every single listing I don't think anything I'm saying or anything that I'm listing out here should be done for every single listing I think it should be case by case realtors that say I do this for every single listing be wary of that ask questions number eight we're gonna talk about lenders for a second here okay not I've been beating up on Realtors how about lenders sending rates like a percentage you know we'll do 6% in terms of your mortgage rate we'll do 6% whatever the percent is that they're throwing out there five seven five something that's eye popping without disclosing what their fees are and man I cannot tell you how often I have seen this that lenders will do this and they put a bunch of fees a bunch of junk fees in there to offset the fact that they are giving you a quote unquote lower rate it's not a lower rate you're paying for the lower rate by virtue of paying all of these upfront fees but because they don't disclose the fees upfront you get hit with you know blindsided with that later after you've already chosen to work with that lender on the basis of their lower rate be very aware that is very common you need to get a full loan estimate an official loan estimate from the lender if you are price shopping multiple lenders because they will do funny things they will rob Peter to pay Paul with some of these numbers and you don't want to be the person that ends up choosing a lender that's actually more expensive than all the others but they tricked you by saying well we can do a lower rate than all of the others when really they're just telling you to basically pay upfront for that rate decrease be very very careful when dealing with that always ask for a full loan estimate upfront and if the lender won't do that that lender's gone do not work with a lender that won't provide for you a loan estimate or that I would even be wary if they are like well I can do that I don't normally do that like if they're hemming and hawing that should be a normal thing for them if they're hemming and hawing and acting like that's not normal that's a that's a bad sign I would move on from them right away No.9 back to Realtors we have this thing called a brokerage disclosure technically it's the South Carolina disclosure of brokerage relationships that the Real Estate Commission has produced for us all Realtors and the general public hate this form it is what I'm just gonna call it like I see it we all hate this form and the reason why we hate this form is because it says the first time you make substantive contact with someone regarding real estate you have to explain and all parties sign the form but it is a disclosure it's not contractual well guess what nobody wants to sign anything the first time they're talking real estate with a realtor but letter of the law we are supposed to do that we are supposed to have you sign this brokerage disclosure the first time we have a serious real estate discussion that has caused OK some agents to get really fast and loose because again nobody wants to do this it can hurt your business I have had times where people say you're pushing too hard for me to sign this I'm done I'm out I don't wanna work with you and you know what have I lost money because of that yeah probably so it doesn't matter it's the law I can't I can't lose my real estate license because I'm scared of losing a potential client this is my livelihood okay and so I have to be obviously explain the document really well to people so that they understand what's going on there but you've got a lot of realtors out there that that they're not sending they're not having this signed until people are signing the buyer agency agreement or the listing agreement and that's a big problem okay if you have a realtor that you're talking real estate with and you've not yet signed the this disclosure of brokers relationships you're working with a realtor that is acting illegally they are violating the law do you want to work with a realtor that's violating the law specifically with regard to you I don't think so be aware okay nobody wants to sign this form but the fact that we have to have you sign the form and we have to as agents sign the form as well that's the law if anyone doesn't do that they are breaking the law and that is definitely not someone that you want to be working with so be very careful about that No.10 last but not least is showings without a broker agreement or a buyer agency agreement in place listen The National Association of Realtors two years ago made it very clear two years ago one and a/2 year whatever they made it very clear if you are showing houses to someone if you're a if you're a realtor showing houses to the general public you need to have an agreement in writing that you are working with them they further clarified that that agreement needs to specify compensation so they what they didn't say was that it had to be a buyer agency contract okay but if it already specifies there's compensation if it says something regarding compensation then it's kind of implied it probably does need to be that a buyer agency agreement maybe some brokers just have come up with workarounds to avoid that whatever if but the thing that concerns me is there are people that are there are realtors that are showing houses without doing any sort of paperwork with the buyers and again that is against the Realtor code of ethics that is something that can cause a realtor to get in massive trouble for again they are violating the code of ethics that they agreed to uphold is that someone that you want to work with I know again we're talking about paperwork people don't like paperwork they don't like to sign things they don't like to feel like they have to hire a realtor if I have someone coming to town they're meeting me for the first time they want to look at houses it it's lousy that we have to do all this paperwork on the front end but it has to be done and if I lose a client over that I'm not sweating it okay they if they're not willing to sign paper right now they're gonna be difficult later and I'm flexible like if it's someone that's just coming into town for a day I'll have them sign an agreement it could be a one day agreement it could be for the weekend no problem like I don't I'm not gonna ask you to commit to me for six months when we literally just met right who does that nobody does that and if you have an agent that does that that's also a scheme to look out for right if they're saying you know if they're using this as an excuse to go ahead and get you to commit to six months before you've even met them or whatever six months a year even three months whatever before you've ever met them before you like really feel comfortable with signing that but they're like you know well you wanna look at houses I only do three or 6 months agreements whatever that's something be very careful cause again it's not easy to break that contract right that has to be signed off by in many instances the broker in charge of the office you agreed to it with the agent but to unagreed to it the broker in charge has to has to sign off on it in many instances so be very careful of that as well so there's been I to kind of put a bow on this there's been something in the water and I've said this a few times there's been something in the water in our market lately with people doing shady things and that's what prompted me to do this episode cause I'm tired of the shady things happening without it being called out I'm the guy that's gonna call these things out because I don't care right I don't care if this angers people I don't care if I end up being on blast on a podcast on another realtor's podcast whatever put me on blast just make sure you tag me first I wanna I wanna be I wanna be tagged so I can respond to it but there's something in the water there's fishy stuff going on and you guys need to be aware of it so thank you so much that's the end of today's episode thank you so much for listening really appreciate all of you guys watching and listening my contact information is in the show notes if you need a realtor that does uphold the code of ethics and that does things legally that's me and so please contact me and if you like this content please subscribe rate review all of those good things I'll talk to you guys again next time!