[Captain Bill]

[quote=RE Skeptic;25485201]

So if I understand you correctly...

Your seller would know that a buyer is "unrepresented" by virtue of a blank BA contact section in the "Arizona contract" which is presumably created and sanctioned by the AAR and it's attorneys. Thus if a buyer conveys his unrepresented status via the AAR contract it is legal. However, if he sends the seller an email clarifying his unrepresented status this is illegal?

I didn't say anything about the legality of a buyer conveying his unrepresented status. I said that the contract has a section for the buyers agent to fill out providing his/her name and company name and that s/he is representing the buyer. Obviously the listing agent knows the buyer is unrepresented and s/he will inform the seller of this fact, as well as the seller seeing a buyer agent missing from the contract.

I did not say it is illegal for an unrepresented buyer to notify a seller via an email that s/he is unrepresented. I said it is illegal to interfere with a third party contract.

I said that it appears you probably knew it was illegal and instead of putting it in the contract or an addendum you tried to skirt the legality and send an email to the seller through the listing agent. The listing agent only has to submit the offer. He does not have to submit a buyers email.

And as I stated, if I got an email cover letter that was attempting to get the seller to renegotiate my commission I would probably consult with my attorney on how to proceed, and would advise my seller to consult with an attorney also.

=RE Skeptic:.....
Agree with you in theory. However, I have a problem with the fine print of most LA and circumstances under which this contract is signed.

Assume your Arizona (AAR) contract commits your seller to pay you:

1) Full commission if you (or someone else including the seller) delivers a "ready, willing and able purchaser", irregardless of whether the home actually sells.

2) Half of EM if the buyer defaults.

3) Full commission if a buyer without an agent purchases the property.

Of course you do not know, and cannot know, the circumstances under which most listing contracts are signed. You can only assume.

1. In our contract if a seller is brought a full price offer with all terms the seller has asked for, the sellers agent is due a commission if the seller backs out and just decides no not sell. The Exclusive Right Listing Contract states that the listing agent will be paid, even if the seller brings a buyer. An Exclusive Agency agreement allows the agent to get no commission if the seller brings a buyer. That contract exists, but why would an agent spend any time marketing that home if s/he may not be paid???

2. The seller gets the EM if buyer defaults. The seller and listing would have to negotiate it if the listing agent wanted half the EM. I would not want that. It is the seller who has lost out if the buyer defaults.

3. Our contract states that the seller is paying the agent x% commission. It also provides a space where they agree on how much commission the listing agent will pay a licensed broker if they bring a buyer.

If an unrepresented buyer comes along, the listing agent receives the full commission. S/he is going to have to work harder working with that unrepresented buyer because 99% of the time the buyer will want to lean on the agent for assistance. There is a huge risk in providing that assistance because any innocent but wrong statement could create an accidental "agency" between the agent and the unrepresented buyer, and the agent could later be sued.

There is a lot about real estate, and the risks that agents are subjected to, that you do not understand. You obviously don't want to understand because you think agents are making too much money and you want to get in their pocketbook. The experienced agents know better and will not let you get away with what you're attempting to do.

Do you review these "gems" with all your sellers prior to having them sign the LA? Or do you relegate these clauses to your subconscious like a previous posting agent (Post #105, Mike from NC)?

I go over the complete listing agreement with them. I tell them the risks of asking me to do dual agency, and the fact that in dual agency I become neutral and cannot advocate for them, and that is why the variable rate commission. If they want me to be dual agent in a transaction, then the commission is reduced.

I let them know that I do not like working with unrepresented buyers because of the legal risks for seller and listing agent, and that there is no commission reduction if one submits a contract.

=RE Skeptic:...
The RAs out there can try to skirt this issue by arguing that contracts vary by state, but I think most state LA's include these provisions. So...do RA's out there feel obligated to discuss these details (#1-3 above) with their sellers prior to signing or do you think it is up to your seller to glean these details from the contract on their own?

Actually no one is skirting the issue. It seems to be you that is skirting the issue that it is illegal for one to attempt to interfere with and renegotiate a third party contract within a purchase contract.

It's already been suggested that you determine the amount you want to pay, bottom line, for the home and make that offer. Or offer something lower. But stay out of the listing agents pocket. It is not your money.