The Golden Rule
The Golden Rule applies to negotiation and the entire real estate transaction. Do not lie about anything. If discovered, you will lose the goodwill of your counterparts and maybe the deal itself.
~~~
Treat others as you want to be treated.
Look it starts with being serious and accommodating and respectful and nice.
But in a real estate transaction, this is mostly about honesty. Do not lie about anything. Do not hide anything. Be open and honest about what you are selling. Or if you are the buyer, open and honest about your qualifications and how you are paying.
Fill out the disclosures as faithfully as you can. Don’t move the sofa to hide the water stain. If there is an unnoticeable easement at the rear of the property, go ahead and disclose it. As a buyer, don’t neglect to inform the seller that you must first sell your current house. If you are planning to use a lender, don’t make a cash offer (yes, we see that).
Our firm feels most comfortable coming down on the side of over-disclosure. Question: But what if that hurts your position or even your clients?
Well it can, and it might, and it will. And it has.
But our goal is this: Will the party on the other side be willing to deal with us again? Or even better, will they prefer to deal with us next time? And personally, I just sleep better if I know that I am an honorable person and an honorable dealmaker. It is as simple as that. And I don’t find that corny one little bit. And certainly not naive. This is a book about integrity.
We have even gone so far to say to our clients: Look, this disclosure is above and beyond what you are legally required to disclose. But we feel it is the right thing to do. We understand if you do not want to, but then you will need to hire someone else. And yes, it has happened that clients have gone on to hire someone else. But we find that the type of people most likely to hire us fully support our position. And they are the type of people we prefer to deal with.
Plus this: Beyond the moral and ethical questions, it is also a practical position. In terms of risk management for our firm and for our clients, and in terms of staying out of court, and in terms of public relations and reputation, over-disclosure is the smart choice.
But now, notice what this is not. This is not: Make sure the other side gets as good a deal as you do. Rather it is: Give the other side the opportunity and information that you would want and need. What they do with it is beyond our control. Maybe they have a lot of experience. Maybe they do not. If not, maybe they are smart enough to get help. If they choose poorly and get less than competent help, well again, that is beyond our control. And we see it all the time.
I tell our agents that it is not our job to instruct the other side how to convey real property. If they don’t know how to do it, there is help available. And it is certainly not our job to instruct a professional, a broker, how to convey real property.
The point is, we find that even with full and over-disclosure, we typically get the better deal.