Reading time: long | Writing mood: appalled | Writing track: Ministry – Thieves (careful, it’s a heavy, aggressive song with swearing)


As you likely already know, I despise the BUY THIS HOME AND I’LL BUY YOURS FOR CASH, IF YOUR HOME DOESN’T SELL IN 10 DAYS, I’LL BUY IT and any other “guaranteed” home selling scam – I mean, program.



Why do I hate them so much? Because it’s bait and switch advertising at it’s worst. It’s appalling, preying on the fears of unknowing home sellers.


I’m certain the cartoon of Charlie Brown above brings back memories. You always knew that Lucy was going to pull the football away. The Guaranteed selling program is Lucy…


I just threw up in my mouth a little


Just last month, there was a house listed right across the street from me. On top of the sign post was a sign (called a ‘rider’ in the real estate circles) boasting…sorry, I just threw up in my mouth a little (fan of the movie dodge ball?), boasting YOUR HOME SOLD IN 10 DAYS OR I’LL BUY IT!

I was able to get my hands on one of these contracts. A seller that I met with gave me a copy. This is the actual contract from an agent in Toronto and comes straight from a seminar offered by a lot of real estate coaches.


You didn’t realize that agents hire coaches to teach them how to sell real estate? I’ll get into that on another blog. Think of this though; keep a running total of how many real estate flyers you find in your mailbox and see how many of them offer a free home evaluation. Majority of agents just do what they’re told to do to get a foot in the door. But I digress….


Let’s take a look at how this gimmick works shall we?


First paragraph: (I removed all reference to the real estate company, real estate board and salesperson because I can’t afford and don’t want to get sued). Let’s name this real estate agent, Shirley.


This Agreement is made ,____________, between ___________________________________________________ (“Agent”) and _ (“Seller”) with respect to the property commonly known as , in ____________, XXXX (the “Property”). All parties understand and acknowledge that XXXX XXXX Inc. is not a party to this agreement and the Agent is the one responsible for securing cash and/or financing to back up this guarantee.


Straightforward, simply stating who is who and, who is responsible for what. Also, this guarantee is offered by the agent and the brokerage that she belongs to has nothing to do with it.



The seller agrees to market or continue marketing the property through Agent for a period of ninety days based upon the suggested market placement list price (“price”) approved by seller of $ . If the property is not sold by the end of two weeks from the date of this agreement, the price shall be adjusted to $ , and if the property is not sold by the end of the four weeks from the date of this Agreement, then the price shall be adjusted to $ , and if the property is not sold by the end of the sixth week from the date of this Agreement, the price shall be adjusted to $ , and if the property is not sold by ,________ then Agent agrees to purchase the property for $ , and close on or before ,________ pursuant to a Contract (“Guarantee Contract”) using the latest contract form approved by the XXXXXXX Real Estate Board with the “terms and conditions of guarantee contract” listed in this agreement.


In plain English, the house must be listed for sale for at least 90 days to qualify for the guarantee to take effect. At a certain number of days on the market, the price gets reduced. If the house doesn’t sell at that price, the price gets reduced again and again and again until, it’s taken off the market and the agent buys it for a price set before the house was listed for sale.


Here’s what happens. The agent brings in a list of recently sold homes, homes that are currently on the market and, houses that didn’t sell after being listed on the market. The price range is wide. What this does for her is three-fold:


  • It allows her to tell the sellers “If that house is listed for that price” or “sold for that price,” meaning a high number, “You can get that price; maybe even more.” Focusing only on the high numbers is preying on the emotions of sellers. You’ll see why in the next paragraph of the guarantee.


  • If the sellers don’t sell their house at that high price, they are forced to lower the price continuously until it either sells at one of the lower prices or gets to the end of the 90 day stranglehold where the agent gets to buy their house at her price.


  • Shirley knows that most home sellers list their home with the first agent that they meet with. It’s a foot in the door – a way to weasel her way into their home.




This agreement is contingent upon the Seller completing the purchase by receiving a deed to the Property located at ______ by , ________. If such purchase shall not be completed, this Agreement shall be null and void and no further effect. Seller acknowledges that Agent will be acting as a Designated Seller’s Agent during the listing period, but will then act as a Designated Buyer’s Agent for self if Seller and Agent complete the guaranteed sale of the Property.


The sellers have to buy and close on a house before the seller’s house is actually listed on the market and, they have to buy that house through Superstar Shirley.


Great for Shirley!


She is guaranteed to collect the commission on the house that the sellers bought through her and now has the sellers by the short and curlies to list their house with her because they just bought and closed on another house without selling their home first and are expecting their home to actually be sold.


Can you see why the agent had the sellers agree to a purchase price for their home before hand and made sure that they bought and closed on a house before they listed their house for sale?


Who is this guarantee really working for?


Also, if it gets to the point where Shirley has the option to buy their house, suddenly she is no longer representing them. That’s a sizable advantage don’t you think? Shirley has knowledge of how to negotiate, what home prices are, what the market is like at that specific moment.


There isn’t any mention of the sellers having any sort of representation. They now have to pay a lawyer to review the offer only if there was a condition in the offer allowing them to do that.


Sleazebag says what?




Seller acknowledges that Agent’s agreement to purchase the Property is a “wholesale” purchase and is intended to assure the Seller that the Property will be sold in order for Seller to purchase another property through Agent. Accordingly, if the Seller enters into a contract to sell the Property to a third-party purchaser prior to the closing of the Guarantee Contract, then this Purchase Agreement shall be null and void and of no further effect.


Shirley has covered her ass by disclosing that she will be buying the house “wholesale”, meaning, at a significant discount. Also, the whole bullshit of the “assurance”. It’s entirely for Shirley! Read it – is intended to assure the Seller that the property will be sold in order for for Seller to purchase another property through Agent. Win win for Shirley. Un-fucking-real.


It goes on to say that if another agent brings in an offer on their house, Shirley’s guarantee to buy their home is ripped up. So what happens to the sellers if the offer falls apart and they have to put their house back up for sale? Shirley doesn’t have to buy their house any more and, if the house doesn’t sell in the 90 days that they committed to Shirley, Shirley walks away and leaves them scrambling to find another agent to sell their home.




Now for the “Terms and Conditions of Guarantee Contract”


  • The property must be listed with Agent for at least 90 consecutive days


  • Seller agrees to pay XXXXX XXXXXXXX Realty a commission of 5% or the amount agreed upon in the listing agreement, whichever is greater.


    • So, Shirley is guaranteeing herself 5% of the selling price of their home while she has already guaranteed a commission from the sellers buying a new home through her.


  • Sellers are buying a replacement property through Agent closing within 7 days of the closing date of the guarantee contract.


    • Talk about being pressured. The sellers buy another home and have to close on the new house 7 days before or after the guaranteed purchase date set out for Shirley to buy their home at a discount.


  • Guarantee contract will allow a full inspection including termite, mechanical and structural and any other inspections deemed necessary by Agent.


    • Shirley gets a chance to make sure the house is structurally sound before she buys the sellers house. My question is, why didn’t Shirley make sure that the house was structurally sound before placing their home on the market?


  • If these inspections indicate that repairs or treatment is needed, seller will agree to make reasonable repairs as discovered during the inspection report or the guarantee contract will be cancelled.


    • Seriously! Shirley wants everything in the house repaired by the sellers or the guarantee is pulled? The sellers are 7 days away from taking on another mortgage on the house that they had to buy through her, and now they have to make repairs to ensure Shirley buys it!?


  • If Agent does not sell the property and it is decided that Agent will buy property, Seller will agree to cancel the listing agreement and authorize Agent to act as a Designated Buyer’s agent for themselves to buy property.


    • As in paragraph 4 of the “guarantee” when Shirley buys their property, the sellers are left without any sort of representation.


  • Seller agrees to reduce the sales price or cancel guarantee contract if an independent third party appraisal value comes in below Agents guarantee contract price.


    • Let me get this straight. The sellers have now made repairs to their house for Shirley. They’ve bought another home through her where she’s already guaranteed herself a commission in the process. They’ve been taken advantage of being stuck with two mortgage payments and have to sell their home at a deep discount and now, if an appraisal on their house comes in lower than the price that they agreed to prior to all of this happening, they either have to discount their sale price to Shirley further or cancel the guarantee? They had AGREED to a price already 3 months ago! A classic double dip.


  • Seller agrees to pay for normal seller closing costs not limited to but including: home inspection, termite inspection and/or treatment, and the real estate commission.


    • Unreal… Shirley is making the sellers responsible to pay for the inspections that Shirley should be responsible for. Further, she is charging them a selling commission while not providing any sort of representation because she has clearly stated that she is now representing herself when it comes to buying their home.


  • Seller agrees to pay for a home buyer’s warranty, at a cost to Seller not to exceed $400, effective for one year after closing if Agent buys property .


    • I’ve only ever heard of this from American real estate transactions. My guess is Shirley bought this “Home Selling Guarantee Program” from an American real estate trainer.


  • Seller agrees to allow Agent to advertise and show property to potential tenants if Agent gives Seller 24 hour notice or more prior to the showing.


    • Here’s the switch with the entire scam. Shirley has bought their property somewhere in the vicinity of 80 to 90% of the actual value of what the home is actually worth. She intends to rent it out for a year so her carrying costs are covered and, she knows that in a year, the property will be worth more and she can sell it at a significant profit.


  • Seller agrees to allow Agent to resell the property in the future at a possible profit and Seller agrees to make no claim to that profit if any.


    • Let’s take a look at why Shirley has this point in the terms and conditions:
      • The Canadian Real Estate Association’s Code of Ethics; section 11 states:
        • A REALTOR® shall not buy or sell, or attempt to buy or sell an interest in property either directly or indirectly for himself or herself, any member of his or her Immediate Family, or any entity in which the REALTOR® has a financial interest, without making the REALTOR®’s position known to the buyer or seller in writing.
    • Can you tell me where Shirley has disclosed that she knows she can sell the property for more money than she’s buying it for?


  • Seller is hereby notified that Seller has the right and option to get counsel from qualified third parties regarding this Agreement or subsequent Contract.


    • Too little too late, Shirley. You have it pointed out everywhere that the guarantee is voided if they get third party approval.



ACCEPTANCE OF CONTRACT: This Contract must be executed by all parties before ______(a.m.)/(p.m.) on the _______ day of _____________________, or it shall be null and void.


I’ll have you know…


Most people, once they’ve read through a “guarantee” like this, don’t generally go through with it. The agent can still advertise this scam on the for sale sign regardless.


These bait and switch programs came into effect in the late eighties during a housing crash and preyed on the emotions of sellers who were likely under water with their mortgage.


Today, in Toronto’s housing market, it’s a complete ploy. Most people usually end up signing up to list their home with the first agent they meet and this program is the con used to get in front of home sellers and list a property. To the agents that use these types of scams, you are a mark, simply a number.


I would never make a false promise like this to anyone. I value trust and reputation above all else and will never rely on phony promises and straight out lies just to make a quick buck off of anyone who is placing their trust in me.


Oh, the house across the street from me; it didn’t sell and was cancelled from the market when it didn’t get any offers on offer night. Guaranteed selling system indeed…