Seattle Residential: I Do That: On Submitting Purchase and Sale Agreements

On Submitting Purchase and Sale Agreements

On Presenting the Washington State Purchase and Sale Agreement

In every state, laws have been enacted to help the public move through life with a regard for the accepted way of completing certain transactions. Some procedures have been found so damaging to the public interest that they have been made illegal. The real estate industry is guided by many such laws.

Some industries, like real estate, have practitioners who form groups, like the REALTORS®, which have devised stricter guidelines in the form of what we call our Code of Ethics. From the Preamble to the National Association of Realtors® Code of Ethics:

In recognition and appreciation of their obligations to clients, customers, the public, and each other, REALTORS® continuously strive to become and remain informed on issues affecting real estate and, as knowledgeable professionals, they willingly share the fruit of their experience and study with others. They identify and take steps, through enforcement of this Code of Ethics and by assisting appropriate regulatory bodies, to eliminate practices which may damage the public or which might discredit or bring dishonor to the real estate profession

Code of EthicsWhere this Code of Ethics and state or national law conflict, the obligations of the law must take precedence.

Over the past decade we have moved through a housing bubble and a bust. Strange and unusual practices and techniques have developed. I follow many news groups and blog sites concerning the real estate industry and one particular practice that has arisen before and is here again, is one which is bothersome for me.

Agents sometimes lose sight of the scope of their obligations.
Sellers sometimes give instructions that agents shouldn’t follow.
Buyers sometimes make demands that agents don’t want to follow.

For example: Between 2004 and 2007 many offers were grossly in excess of the asking price, and were often accompanied by other concessions from the buyer and/or buyer’s agent to make the deal more likely to favor that particular buyer. In most cases, this is merely an indication of how much the buyer wanted to buy the property.

But, I’ve been reading lately, where buyers are offering “side deals” to owners selling short, to cover moving expenses, and bonuses to listing agents for stronger consideration of their offer among the many, if there are multiple offers.

This appears to be the same thing as above, but in the case of a short sale, it is a matter of defrauding the bank. If the value of the property to a buyer is the price on the purchase and sale agreement, plus the moving expenses gift, plus the agent bonus, shouldn’t all of that money be applied to the mortgage? I’m not a advocate for the banking industry. But I am an advocate for following state and federal laws and the REALTOR® Code of Ethics.

As an agent, I know that, in Washington, all written offers must be presented to the seller. Failure to do so may be breaking a law. It is not my place, as a listing agent, to tell a buyer’s agent not to write an offer because the seller won’t go that low.

As a seller, (including banks, but they do it all of the time) to demand certain restrictions on offers, or to say that you don’t want to see them unless certain conditions are met, is asking your agent to break a law. Just accept delivery of them and counter them, or not, as you see fit.

As a buyer, you have a right to offer any price you want for a property. And, if you have an agency agreement with a real estate licensee, that agent should forward your wishes. That’s reasonable. Please don’t ask your agent to do anything illegal.


As always, I am not an attorney. I am a REALTOR®. Creative real estate practices by everyone from Main Street to Wall Street got us in trouble over these past few years. Let’s not be too creative once again in our zeal for recovery or personal profit.





Glenn Roberts



Comment balloon 36 commentsGlenn Roberts • April 21 2011 03:07PM


Excellent post, Glenn. Unfortunately some of these "side deals" are not the brain child of the buyer or seller, it's the agent. And that is truly sad.

Posted by Cynthia Larsen, Independent Broker In Sonoma County, CA over 9 years ago

Cynthia - Yes, it is especially important for agents (Realtors® and not) to bring agency back into being and agent by putting self last.

Posted by Glenn Roberts (Retired) over 9 years ago

Just look at the time we'd save if we didn't have to take those ((*%%$&*( REAL ESTATE ETHICS CE.

If you know the right thing to do or the law that governs, just do it. 

How hard is that???

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley,, MD & VA Homes and Real Estate) over 9 years ago

Defiantly agree with Lenn on this one. Agents, we know what's right, REALTOR or not. Back deals are just plain wrong, and hopefully that's not where the creativity is coming from as it would give us all a bad name.

Posted by Drick Ward Property Management / Broker Assoc, "RealtorDrick" - Experienced Representation (NEPTUNE REALTY) over 9 years ago

Lenn - It is surprising how many licensees have a mind that has never considered the laws or the ethics.

Drick - Creative thinking includes agents as well.

Posted by Glenn Roberts (Retired) over 9 years ago

Yep, I knew this would be featured. Like I said earlier, EXCELLENT POST.

Posted by Cynthia Larsen, Independent Broker In Sonoma County, CA over 9 years ago

Cynthia - Are you the one? (Thanks)

Posted by Glenn Roberts (Retired) over 9 years ago

Hello Glenn.  I hadn't heard of any "side deals", but it certainly doesn't surprise me.  Desperation (and greed) are powerful motivators for all parties involved.  Those who stay clear of any gray areas will survive and those that go over the line usually have that catch up to them.  At least I hope so.  Thanks for a thought provoking post. 

Posted by Mitch Gover ( over 9 years ago

Mitch - There is so much in play these days, that sometimes the highroad is not the path of least resistance (at the moment).

Posted by Glenn Roberts (Retired) over 9 years ago

Yikes! Sounds like you've got quite a mess going on up there!

Posted by Donna Harris, Realtor,Mediator,Ombudsman,Property Tax Arbitrator (Donna Homes, powered by JPAR - over 9 years ago

Glenn- years ago I was in such disgust over the things the NAR was lobbying for in Washington that I stopped belonging.  So I'm NOT a realtor.  But I am still an ethical, by the book, law abiding Broker.  And recently when I had a buyer asking me to violate the law I threw his butt out of my office after explaining that he was not worth me loosing my license or going to jail for and that no ONE deal would ever be that valuable to me. 

It has more to do with the kind of human being a person is... doing the right or wrong thing, than to belonging to a group that says they hold themselves to an even higher standard.  Earlier this week I heard a REALTOR say he thought steeling photos was okay, HA.

Posted by Tammy Lankford,, Broker GA Lake Sinclair/Eatonton/Milledgeville (Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668) over 9 years ago

Donna - I'm afraid it is going on all over the place.

Tammy - People often act in a way that they see or think they see other people acting. Legal for some, but not for others. For instance, banks can offer a seller in a short sale "moving expenses" since it is just an assessment of how much they will be short and may be trying to move the seller along sooner. But a buyer offering such a side deal is skirting the rights in the contract.

Richard - Thank you. A seller can specify :cash only" in a listing. If an agent and buyer write an offer with financing, does the listing agent still have to deliver it to the seller? I surely would. I don't know when he might change his mind. The rejection option is there for the seller, not the agents choice.

Posted by Glenn Roberts (Retired) over 9 years ago

Bravo Glenn, this is so very well written and a fine example of why I am a Realtor…

Posted by Paul S. Henderson, REALTOR®, CRS, South Puget Sound Washington Agent/Broker! (Fathom Realty Washington LLC) over 9 years ago

Paul, Thank you, sir. I like to think that in the big picture, we try harder.

Posted by Glenn Roberts (Retired) over 9 years ago

Erica - Yes, discussions with sellers about "what people say" are important.

Posted by Glenn Roberts (Retired) over 9 years ago

I just wrote an email to a VP at B of A--alerting him to the fact that his own employees were suggesting that we circumvent the HUD-1. SOme really strange stuff is going on. The  more desperate people get, the worse things get. Yes, buyers have a right to ethical treatment. But, I guess it is also their responsiblity to hire an ethical agent who takes the fiduciary relationship seriously.

Posted by Melissa Zavala, Broker, Escondido Real Estate, San Diego County (Broadpoint Properties) over 9 years ago

Sorry I'm a day late, but this post is excellent Glenn.............well deserving of being Featured.

Posted by Roger D. Mucci, Lets shake things up at your home today! (Shaken...with a Twist 216.633.2092) over 9 years ago

Glenn. We are only required to present legal offers and according to our sellers instructions. My seller may instruct me to only present offers that meet a certain price minimum. They can do that. 

Short sales have definitely brought out the worst on folks. Mostly because of frustration. Banks are making up the rules as they go along and some make no sense whatsoever. So agents, buyers and sellers are thinking of ways to skirt around these unreasonable rules. Problem is that we can't act illegally or unethically just because the lender is doing so.

Posted by Bryant Tutas, Selling Florida one home at a time (Tutas Towne Realty, Inc and Garden Views Realty, LLC) over 9 years ago

Melissa - The ethics on both sides of the table need to be improved. Sounds like the way Washington Mutual was run.

Roger - This isn't a Facebook Birthday. You are never too late.

Bryant - In Washington, all offers must be presented. After one is accepted, others may be solicited by the owner by requesting a status of sold pending/backups requested. Otherwise, they should not be submitted.

Posted by Glenn Roberts (Retired) over 9 years ago

Exceptional post Glenn.  

We're surprised that an offer that carries an obviously fraudulent component would be required to be presented.  If we were to attempt to explain to the seller that we felt it may be fraudulent and it were then accepted by the seller, we would then be a party to that fraud.

We need to be cognizant of right and wrong at all times.  Common sense will usually dictate when something is "wrong".

Posted by Howard and Susan Meyers (The Hudson Company Winnetka and North Shore) over 9 years ago

Howard & Susan - We absolutly need to be cognizant of what is wrong and not be a party to it, or instigate it. I'd like to see more licenses lost for such errors in judgment.

Posted by Glenn Roberts (Retired) over 9 years ago

Great post today, thanks for getting it out to us today.


Patricia/Seacoast NH & ME

Posted by Patricia Aulson, Realtor - Portsmouth NH Homes-Hampton NH Homes (BERKSHIRE HATHAWAY HOME SERVICES Verani Realty NH Real Estate ) over 9 years ago


Your post should be copied and pasted on agent's foreheads so they remember what is ethical.  No matter what your clients asks of you, you have to do what is legal and ethical.  It is not worth risking your license to comply with your clients wishes.  Follow the law and our Code of Ethics and you can't go wrong.

Posted by Evelyn Kennedy, Alameda, Real Estate, Alameda, CA (Alain Pinel Realtors) over 9 years ago

We all know that we need to submit all offers to our sellers. However, in California, if a seller gives me written instructions that he/she/it does not want to see offers of a certain type I do not have to present those offers. I can notify the person making the offer that the offer is unacceptable in my role as agent for the seller. I cannot make decisions that the seller needs to make but if the seller has already decided that certain offers shall not be reviewed, so be it.

Posted by John Juarez, ePRO, SRES, GRI, PMN (The Medford Real Estate Team) over 9 years ago

Patricia - It's been a slow news day.

Evelyn - It's not rocket science but often money gets in the way.

John - Interesting to learn about how other states handle that. Thanks.

Posted by Glenn Roberts (Retired) over 9 years ago

The potiential criminal charges and loss of license is enough to keep me from doing it.  I would not object to some of the side deals (moving expenses and such) if it were legit, which it is not.  Those side deals can be abused too and I think that is why the banks do not like them.

Posted by Gene Riemenschneider, Turning Houses into Homes (Home Point Real Estate) over 9 years ago

Hi Glenn,


Funny how many believe that rules and laws are really only meant for others, or that they can permit themselves to shirt the law jsut this once, then twice ....


Great post.

Posted by Ranji Singh (Century 21 Heritage Group Ltd.) over 9 years ago

congrats on the feature.. it is well deserved.. great blog!!!

Posted by Sheila Newton Team Anderson & Greenville SC, Selling the Upstate since 1989 (Berkshire Hathaway HomeServices - C. Dan Joyner) over 9 years ago

Gene - So many miss the point that there are laws and ethics. They only know that the deal is the thing.

Ranji - I agree, and they need to learn...the hard way if not in clas. They didn't learn from their parents.

Sheila - Thank you.

Posted by Glenn Roberts (Retired) over 9 years ago

One thing I learned as a real estate trainer - ethics cannot be taught - but that is why we have the Grievance and Standard of Practice committees - report violators so we can get them out of our profession - The process makes sure the event was not just a mistake - it only hurts those who have a lack of ethics.  NAR requires we take their Ethics course once every 4 years - just to keep honest people honest - I would think once every year would be a good idea.

Posted by Kimberly Brandon, Broker/Owner (Smart Moves Real Estate) over 9 years ago

Glenn, It is quite a time we are living in. The surprises can come from any direction. Then legitimate buyers can't understand why their underwriter needs sworn affidavits in the file regarding their access to funds and so on.

Great post and feature worthy for sure.

Posted by Charles Edwards Bentonville, AR REALTOR, Bentonville Real Estate Agent and Broker (Coldwell Banker Harris McHaney & Faucette 479-253-3796 ) over 9 years ago

Kimberly - Our broker seems to teach ethics weekly, by example at our meetings.

Charles - Not hard to see why so many are demanding more regulation of our industry to control the few abusers.

Posted by Glenn Roberts (Retired) over 9 years ago

The rules that guide us a Realtor® are there for all parties protection.  I do not think it difficult to explain how we must conduct ourselves to a buyer or a seller.  If they want to go down some road that will jeopordize our career, we have to be willing to make the right decision.  Unfortunately, those of us that make the right decision are not written about.  It is those in the ranks that want to gamble that catch the eye of the press and government officials.  Glenn your post is a sound reminder to us to stay in control of our transactions.

Posted by Robert Courtney, Century 21 All Islands, RA, CDPE, MCRE, CIAS over 9 years ago

Robert - the difficulty is, how does one make the honest agent stand out?

Posted by Glenn Roberts (Retired) over 9 years ago

Wow Glenn.  How ironic.  I just wrote a post about integrity in our business.  Even when the seller says a 100 times that they won't accept an offer below $xx.xx, you just never know when they might change their minds.  So even when you get the offer for the 10th time that is below that number, you still have an obligation to present it to the seller.

Posted by Charita Cadenhead, Serving Jefferson and Shelby Counties (Alabama) (eXp Realty) over 9 years ago

Charita - We always need to keep on our toes, and keep reminding others that the right way is the only way.

Posted by Glenn Roberts (Retired) over 9 years ago