When acting as a seller’s agent, your view on deposits and when the buyer should make them, probably changes.

If you’re a buyer’s agent, your buyer likely won’t want to put up their money until conditions have been removed, and then only within 24 hours. But if you’re a seller’s agent, your seller will probably want the deposit sooner than later, so the buyer’s feet are held to the fire should they start waffling on the deal.

The Board doesn’t have a specific requirement for when a deposit must be placed in trust, but the BC Financial Services Authority (BCFSA) does weigh in. Remember, the obligation to provide a deposit is referenced in the contract of purchase and sale. Following what the contract says, to the letter, is expected by your clients, the courts, BCFSA and the Board.

If I were king for a day, and acting for the seller, I’d require all subject offers to be accompanied by a $5,000 deposit on acceptance, with an increase to five per cent of purchase price on subject removal. This would probably weed out triflers and save a lot of grief, and if the buyer starts waffling on a subject removal, there’s $5,000 the seller can lay claim to.

If I were king for a day, and acting for the buyer, I’d want to see a provision for the deposit to be made on subject removal, so the buyer doesn’t have to put up any money until conditions are removed.

Just make sure you talk to your client about their deposit options when you write offers for buyers or present offers to your sellers. This could save you from having a potentially tiresome agent-client conversation later on about what didn’t happen with the deposit.

A few times each year I remind members about the importance of providing accurate property information to the Board. The MLS® system and your colleagues—and their clients— depend on the accuracy of this information to make very big decisions.

So, for example, if your listing’s total square footage has been plumped up by, say, adding the garage floor area or other unauthorized living space to the total, you’re exposing yourself to a potential regulatory (BCFSA) and/or Board investigation for misrepresentation or negligence, not to mention possible court action by the person who relied on the information.  

We all know this. Perhaps less well known is that an inaccurate floor area comprising unauthorized space may mislead other members downstream who use that information in their CMAs, further multiplying the potential risks for even more folks.