Olive Branch Inspection Contingency

Given a choice, without being told of potential consequences, a Buyer Client is 99% likely to include a Buyer Favorable leverage an inspection contingency, over the one on page 9 of the Offer to Purchase.  The people who created the Inspection Contingency in the Offer intentionally tilted the advantage to the Seller. Obviously the Seller has more to risk in negotiations after acceptance. The party with the most on the line should have a reasonable opportunity to cure defects, and  keep a transaction together when unexpected conditions are identified. During the Buyer Market run we had in and after the recession, more Firms began using a Buyer Favorable Inspection Contingency as standard practice. Sellers had no choice but to allow the Buyer to have the leverage which was intended for them.  That happens when the market changes.

Well, the market changed again. Licensees stuck in the new habit of using a company crafted Buyer Leverage Inspection contingency gave no thought to the consequences to their clients and went right on checking the box without discussing the difference between that contingency and the one on page 9 of the Offer.  Sellers and listing agents  were quick to identify the high risk condition of the Buyer Favorable contingency. For no reason other than risk, Sellers will reject Offers which give the inspection advantage to the Buyer.  It’s a shame when  a person loses a house because they weren’t given a chance to make their offer more attractive to the Seller by simply being kinder, gentler, and safe.

Knowing the difference between a Heavy Hand and an Oliver Branch allows the licensee  to  give the client a real opportunity. It’s a magical thing  watching a licensee earn the confidence of clients when they explain choices and think through a choice with clients.

Become a part of the conversation, a part of the thinking process by learning to find the trips  and traps of contingencies.  Some people will always do as they always have because that’s the way they learned it. But those people will never have the results they could have by learning why  something is as it is, and learning how to make the contingencies work for their client.  And by working for their client I don’t mean wrapping them in unnecessary protections.

The Voice of Catastrophe our Learning

Seth Godin’s Catastrophe Journal Blog Post

Do you know The Voice in our head that tells us we’ve messed up, failed, blew it, caused a catastrophe? Nothing is ever good enough for The Voice.  It thrives on turning transgressions, oversights, and choices into catastrophe. The more The Voice talks the more persuasive it becomes until we are certain we will be fired, demoted, ridiculed, unlicensed, unworthy.   If The Voice was in our living room talking to us instead of in our head, I think each of us would stand up and escort The Voice to the door. So why do we give The Voice aid and comfort in our head?

When things go wrong as they sometimes do, we have a choice to name it a learning experience or a confidence crushing catastrophic event. Seth Godin wrote about the self made catastrophe in his blog today.  Everyday is a good day to be reminded that things are never as bad as they seem. (Of course they’re also not as good as they seem…but let’s not go there today.)

One hundred percent of the choices we make are right in the moment the decision is made. They are correct actions made with the information we have at the moment, with the knowledge we have at the moment, with the perspective we have, with the goal as we know it, and the facts as they are.  It’s only after other facts, opinions, perspectives, alternative facts, or new information, and alternative history are added to the event that our right choice of the moment becomes questionable. We live in a world of second guessing. The privilege of standing on the sidelines is knowing exactly what should have been done by the person who is in the game, in the moment, under pressure. We are in this business because we are eager to be in the action with all of the risks and rewards; we don’t desire to be second guessers. We don’t require the safety of the sidelines.

We live in a world of continual education. We learn from what we do well and from results we didn’t desire. Real estate contracts are accepted or rejected based on the choices of the drafter, the buyer, the seller, the presenter.  Learning to present options, think through choices, anticipate consequences, and be willing to be an unbiased, calming voice in the conversation is one way to a long term career.  We are licensees in a Firm excelling in presenting a unique opportunity to consumers of real estate service. We, each of us,  are that opportunity.  What we are, who we be, is up to us.

Seth Godin’s suggestion of a Catastrophe Journal is a smart tool for becoming who we are capable of becoming. In retrospect I can name many of my own disasters that didn’t result in the worst fears of The Voice coming true.  Like you, I can also see many results that met or exceeded expectations, because of a choice I contributed to.  Keeping journals of Catastrophes will show that they aren’t at all. The journal of Successes might show us something we need to recognize also.  We have a role in results, owning our part of the responsibility, accepting and sharing credit is more productive than listening to The Voice. I’m going to take 3 weeks to quite The Voice of Catastrophe.




Why do we go to the doctor?

Last year physician office visits topped 990 million. (*www.cdc.gov)  Being ill or hurt might cause a person to go to the doctor.  The reason a person goes to the doctor is to get well. You could say we want to get well because all things considered, being well or healed is a desirable lifestyle.

Why do people hire a REALTOR? Have you ever thought maybe we aren’t called to sell a house or to find a house? We’re instead invited in to improve a lifestyle; the present situation is this, it’s not sustainable, desirable, acceptable. The objective is to change the situation to a lifestyle that is acceptable, desirable, sustainable.

It’s a rare person who goes to the doctor at the first sign of feeling unwell. The motivating factor to get a guy with heart disease symptoms to a doctor is a heart attack. About the moment a person with diminishing health loses ability to be vertical, the interest in getting well skyrockets.  If the goal of a person is to simply sell a house, or own a house, our service has a value closer to zero.  It’s possible a person who thinks they want to just sell a house or just own a house is not aware that what they really want to do is much more than that; they want a better life. The outcome of selling is a financial change intimately connected to achieving lifestyle wellness. Equity money, which is only numbers on paper,  converted to cash in hand at closing is the key  to  eliminate something causing unfavorable lifestyle (debt) or the key to open doors to achieve a more favorable life (different living conditions). Lifestyle is a factor of wellness.

Getting well is serious business. We value being well when we desire wellness more than we tolerate illness, pain, or unsustainable conditions.

What does the Offer say?

No one hears this question anymore, but there was a time when every wise cracking kid had an answer to this question,  “What does your watch say?” Kid: “Nothin’. Ya gotta look at it.”  Which reminds me, we used to look at our wrist watch often. Now we look for hours in a day at the screen on the device in our hand. Where are we headed?

Every agent who has ever come to me with a question on what options are available to solve a problem in a transaction knows the question I will ask back. “What does the contract say?” (I’m waiting for someone to respond with, “It says nothin’. Ya gotta read it.”)  This evening I was reading  Wisconsin court case decisions regarding real estate contracts. (There’s a sentence rarely uttered out loud.)  With all of the work done by lawyers to make a case for their side, at the end of the day, the judge(s) refer to the words of the contract. They decide if the issue at question is the result of an ambiguity. They decide if a term is adequately defined, or commonly understood. After looking at the contract to see what it says, the judge decides. Knowing that the dispute we hope to avoid is decided by the terms of the contract, it makes sense we read the contract before deciding our options.


















How are you different?

Have you noticed the trends real estate firms are chasing? Limiting service in the race to the pricing bottom is one. Mass customization is the other. We’ll concede the win in those areas to the firms best equipped to cut service.

Real estate service can be cheap. It can also be cheapened. The harder route is to make real estate service essential, and valuable.  We choose to go where others won’t; the harder road is less traveled. To live where others fear, all we have to do is know what matters to our clients one client at a time. Every person has their unique perspective, dreams, and concerns. The giant retail way sees every person as one who desires lowest cost and tolerates marginal quality.  That’s not us. Our clients demand fair pricing, and expect quality performance.  Fairness is relative to the quality. Where others fear they can not maintain high quality, they counter with limited service. Commit to less, charge less, be held to lower standards is one business model. Not ours, but it is an option.

By living in a learning, questioning, discovery centered environment, our agents prove themselves effective in personalizing service individually. They know how to hear you, and how to apply the solution tools we own to accomplish your intentions. Limited service might be the answer to  a questions we’re not contemplating.  More service, with greater quality and properly delivered is our way.

When you  can’t afford to be cheap and under served, talk to us. We agree with you.



Escalating Emotions. The case for Notices and Amendments.

No one wants to receive bad news or inconvenient requests. We know the terms “bearer of bad news” and “kill the messenger”.  We know them because the practice of killing the messenger/bearer of bad news is a practice that has only literally ended, not figuratively. We’ve all been slain and we’ve all done the killing. We know both sides.

Real estate licensees, in my opinion, expose themselves to unnecessary stress and liability every day. When it comes to communicating requests, responses, good news, or bad, indifferent or otherwise, we do not have to put ourselves in harms way.  I’ll go a step forward, we are not expected to or advised to.  The contract is an agreement between the Buyer and Seller. Negotiations are between the Buyer and Seller. Only their promises and commitments matter, unless we voluntarily step in and assume some liability.

When things go wrong, as they sometimes do, the real estate law as it applies to licensees provides efficient tools for keeping the parties involved in the discussion between themselves. Those tools  are Offers, Counter Offers, Amendments, Notices, CAMR, and a host of other forms created by the WRA. Our role as licensees is to put the intent of the parties in writing. Our obligation to use proper forms when available tells us to use these forms, not text, phone calls, emails, or faxes. (Delivery by email or fax is a different issue…I’m not talking about delivery.)

When a buyer wants to change the terms of the offer, even something like closing date, an amendment signed  by buyer presented to seller is the prudent method. A phone call between agents is not. People make significant schedule commitments to change closing dates. Implications of misunderstanding are severe.

When a person has a problem, the explanation coming from the party to the contract to the party of the contract keeps the agents out of harms way. Sure we have to prepare the wording, but we do that with direction from the party.

An easy way to articulate the message from your client is to imagine the parties are sitting across from each other. Simply write the facts the party would convey in a conversation. For example:


Using an amendment the buyer will simply “say” to the Seller:

(Our) “Buyer’s lender informed (us) Buyer that the final approval of the financing commitment will be issued on Monday July 24th. 

Items 1. Financing Contingency Line 219, change 30 days to 35 days.

Listing agent is obligated to promptly present this amendment. I know agents will sometimes react with “My seller (or buyer) won’t agree to this.”  They really don’t know what the seller will do until the seller does something.  With a document to sign in front of them, they have a chance to sign. With only a phone call, they can’t commit if they wanted to, but they can easily decline.

Does this make sense? If the reason to not use a form is to be expeditious, the prudent practice might be to use a form to avoid liability for the consequences of misunderstanding, forgetfulness, or legal professional finger pointing.



Contingencies. Who will do what by when, and then what?

Contingencies make up a checklist of verification of facts,  or due diligence of investigation.  A contingency will answer this sequence of questions. “What are we verifying, who will do the verification, who will pay for it, when will it be done, and what will we do if the investigation turns up something unexpected?”