The most professional and ethical action is to maintain the integrity of the first contract while protecting the seller’s interests. Signing a backup offer is prudent, and transparent communication with the first buyer’s agent about the situation and the hard deadline is crucial. Issuing a Notice to Perform before the contingency deadline (option 2) is premature and could be seen as bad faith. Option 1 risks wrongful termination of the contract, and option 3 involves the agent overstepping by contacting the lender directly, which violates confidentiality and typical protocol.

Location is the paramount factor in real estate valuation. A home in a different school district, even if recently sold and physically similar, is not a good comparable because location-driven desirability and value can differ significantly. Adjustments can be made for property features (option 0), time (option 2 with proper market trend analysis), and active listings (option 3 is useful to see competition) but a fundamental location difference makes it the least comparable.

Standard real estate contracts require the seller to deliver marketable title, free and clear of all liens and encumbrances (except those agreed upon). A municipal lien is an encumbrance that attached to the property during the seller’s ownership. It is the seller’s responsibility to satisfy it at closing. The title company may ultimately cover the cost if their insurance is invoked, but contractually, the obligation to clear the title falls on the seller.

As the buyer’s agent, you have a duty to present offers in a manner that makes them credible and likely to be considered seriously. In a competitive market, an offer without a pre-approval letter is typically not considered valid or strong. You must counsel your client on standard practice. Refusing to submit an incomplete offer protects your client from automatic rejection and upholds professional standards. It is not your role to vouch for a client’s finances without documented proof.

The CIS is a mandatory disclosure in New Jersey designed to ensure consumers understand agency relationships at the outset of their interaction with a real estate professional. It explains the various roles an agent can play (seller’s agent, buyer’s agent, disclosed dual agent, transaction agent) and defines the duties associated with each. This allows the consumer to make an informed decision about representation before proceeding. It is not about commissions, CMAs, or property defects.

While a price reduction and a credit can have a similar net financial effect, changing the sales price can trigger a review by the buyer’s lender. The lender’s underwriting is based on the agreed-upon price and loan-to-value ratio. A change, especially a downward one, may require re-underwriting, delay closing, or even cause the loan to be denied if it affects the appraisal or loan terms. A credit at closing is often a cleaner solution. The agent’s advice, while possibly well-intentioned, overlooks this critical financing contingency.

Property taxes are a recurring expense tied to ownership over time. At closing, the seller is responsible for taxes up to the date of closing, and the buyer is responsible from that day forward. Therefore, the accrued, but often not yet billed, taxes are prorated (divided) based on the closing date. Commissions and recording fees are not prorated; they are paid in full by the responsible party (seller pays commission, buyer typically pays mortgage recording). Homeowner’s insurance is arranged and paid in full by the buyer.

Before discussing terms, writing an offer, or receiving confidential information (like their motivation or financial limits), you must disclose your agency relationship. Providing the CIS to an unrepresented buyer at an open house is mandatory in New Jersey. It formally informs them that you are the seller’s agent and owe fiduciary duties to the seller, not to them. This allows the buyer to understand your role and decide if they want to proceed unrepresented, seek their own representation, or potentially negotiate for you to act as a transaction agent.

Providing pricing advice based on market conditions is a key part of an agent’s professional service and is not, by itself, a license violation. The other options are clear violations: 0) violates escrow handling rules; 1) violates commission splitting laws (only licensed persons can receive commission); 2) violates disclosure requirements for self-dealing, which is a serious breach of fiduciary duty.

The most professional and ethical action is to maintain the integrity of the first contract while protecting the seller’s interests. Signing a backup offer is prudent, and transparent communication with the first buyer’s agent about the situation and the hard deadline is crucial. Issuing a Notice to Perform before the contingency deadline (option 2) is premature and could be seen as bad faith. Option 1 risks wrongful termination of the contract, and option 3 involves the agent overstepping by contacting the lender directly, which violates confidentiality and typical protocol.0