A Miami real estate agent has a very unhappy customer just a few months after helping them purchase a new home.

  • There are always going to be some unhappy post-purchase buyers looking to blame the agent for their concerns. The broker should be involved immediately in these cases.
  • Legal protections for the agent and office are built into contracts, but brokers can secure an extra layer of defense by purchasing E/O insurance.

In this monthly column, Anthony Askowitz explores a hypothetical Miami real estate situation from both sides of the broker/agent dynamic.

This month’s situation: A Miami real estate agent has a very unhappy customer just a few months after helping him purchase a new home.

Agent perspective

It looks like no good deed goes unpunished. Three months ago, I finally found a home for a demanding buyer, negotiated the price and closed the deal smoothly. He was very pleased at the time, and we parted from this transaction on good terms.

Now, he is calling me every week with a litany of complaints about the home that are simply not my problem. Apparently, a few issues were missed during inspection and comps are suddenly dropping in this once-promising neighborhood.

This buyer is really furious and threatening legal action against me, my team and my brokerage.

I have had some unhappy post-purchase buyers before, but never anything like this. I pointed out to the buyer that the real issue is with the inspection company, which was one of three I had recommended, per my broker‘s advice.

I patiently tried to explain the concept of caveat emptor, and went so far as to point out that MLS listings clearly state that information should be deemed reliable but is not guaranteed.

He still insists that I misled him, and he refuses to assign blame to anyone but me.

It looks like I need to speak with my broker about some impending legal action.

Broker perspective

Unfortunately, this is a problem that does occur, and we sometimes receive calls from angry buyers after some time has passed since their closing.

Bottom line: the role of an agent is that of adviser, and the agent’s job ends at closing. The law is very clear on this, but we are in the business of pleasing people, so explanation and soothing may be necessary at times.

In a case like this, I would first recommend getting the broker involved earlier in the process, because — fair or not — the buyer has already lost trust in the agent.

I would carefully spell out the responsibilities of the agent versus the inspector, distinguish the differences between things missed on the inspection report and things that were simply broken, clarify that we are not responsible for the property and explain that part of homeownership is assuming responsibility for things that break.

It is important to note that there are many disclosures in the standard agent-client contract that legally protect the agent from situations like this.

In many cases, unhappy buyers tend to calm down after having their say and sufficiently rattling their saber.

However, if a broker’s explanation fails to satisfy, some very unhappy buyers will go the extra mile and actually sue for perceived mistakes made by the agent.

These buyers will not target the agent; they — and their lawyers — tend to go after the deep-pocketed offices instead.

That is why most real estate companies have E/O (errors and omissions) insurance.

E/O insurance specifically covers mistakes made by an agent. It may be useful in a situation such as this one, but it comes with large deductibles.

While every office handles E/O insurance matters differently, most have the agent pay the deductible.

This is not meant to suggest that the agent is at fault in this hypothetical situation; it just illustrates the reality that — at fault or not — anyone can be sued, and E/O insurance offers tremendous protection to companies and agents.

How to meet halfway

Education is critical in avoiding future client unhappiness. Agents should carefully explain to their clients the responsibilities of all parties in a home sale, including those of the inspector, the appraiser, the mortgage provider and the agent.

Brokers can provide their agents with better training in the understanding of contracts, addendums and the various intricacies of a transaction.

Of course, buyers have responsibilities, too. But that’s another discussion.

Anthony is the broker-owner of Re/Max Advance Realty in South Miami and Kendall, leading the activities of more than 165 agents. He is also a working Realtor who sells more than 150 homes a year.

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