Realtor referral fee without a referral (real estate, how much, buying a home)

[Steingrimmur]

I'm new to buying a home and spent about a week with a realtor (Realtor A). I am no longer actively looking for a home, but have a good friend (Realtor B) who is a licensed realtor and said he would let me know if he saw anything that looked good for me, and would take me with him so I can get to know the neighborhoods and home values so when I'm ready - I'll be better educated.

The problem . . . I signed a contract for 'exclusive right to represent buyer' with Realtor A (I was foolish to not know what I was signing - we never discussed it and it was thrown in an electronic bunch of forms)- and now I'm locked in for 5 months. Realtor A told me that she won't let me out of the contract unless I get Realtor B to agree to a referral fee. I'm not understanding what this is, but it is not sitting well with me.

Is this normal? It feels icky. Why would she get a referral fee if there was no referral?

[Bigins]

Since you signed the contract, you have to honor it. How much is the fee? Have you told your friend? He would know if there’s anything you can do. How did realtor A find out about who realtor B is?

[Ghengis]

use Realtor B but keep rejecting everything they show you for the next 5 months

[Steingrimmur]

I guess I'm not sure why she would want a referral fee when there was no referral. I was honest with her and told her I'm not actively looking and that I have a close friend who offered to help me (who is licensed) when I am ready to look again.

Legally, I have to honor the contract. I understand that. But it's not uncommon for people to "break up with" their realtors and many realtors will sign a cancel-type contract - no problem.

I did not understand her wanting a referral fee and telling me she will give me what I want (out of the contract) once she gets that referral fee. It feels like she is keeping me hostage.

She explained that she wants to get paid for her work.

Since I'm in no hurry to buy a home, I will do exactly what was mentioned. Simply wait until the 5 months are up.

[snebarekim]

Originally Posted by Ghengis

use Realtor B but keep rejecting everything they show you for the next 5 months

Realtor "B" is his friend he seems to want to use.


There is a Real Estate sub forum here at City Data that may be more helpful to your particular situation.

Post there perhaps.


http://www.city-data.com/forum/real-estate/

[Steingrimmur]

Thank you!

[wamer27]

If you really want to screw over realtor A, have her keep showing you homes for 5 months and then sign on and buy from realtor B. She wants to be paid for her time, good luck with that. She’s not selling your home, so she doesn’t have any real money involved in it, she didn’t pay to get it advertised, staged, open houses, etc...

[Glenfield]

Originally Posted by wamer27

If you really want to screw over realtor A, have her keep showing you homes for 5 months and then sign on and buy from realtor B. She wants to be paid for her time, good luck with that. She’s not selling your home, so she doesn’t have any real money involved in it, she didn’t pay to get it advertised, staged, open houses, etc...

We’ve used a buyer’s agent before and it’s standard contract language that they are legally your agent for any purchase made during the contract period. Her commission would be a split of the seller’s agent’s commission. Agent B is not going to represent him while he’s under contract with agent A. It would be unethical and lead to a legal headache that Agent B could surely do without.

OP hired Agent A and signed the contract. Agent A will let him out of the contract but she has shown him properties and, according to the OP, put at least a week into the effort. Asking to be compensated for that time and effort seems very fair, especially when she could just tell the OP to go pound sand.

I’m not sure why some of you see Agent A as the bad guy here. The OP was sloppy and doesn’t want to pay the price for his sloppiness. I am totally unsympathetic to him.

[wamer27]

Originally Posted by Glenfield

We’ve used a buyer’s agent before and it’s standard contract language that they are legally your agent for any purchase made during the contract period. Her commission would be a split of the seller’s agent’s commission. Agent B is not going to represent him while he’s under contract with agent A. It would be unethical and lead to a legal headache that Agent B could surely do without.

OP hired Agent A and signed the contract. Agent A will let him out of the contract but she has shown him properties and, according to the OP, put at least a week into the effort. Asking to be compensated for that time and effort seems very fair, especially when she could just tell the OP to go pound sand.

I’m not sure why some of you see Agent A as the bad guy here. The OP was sloppy and doesn’t want to pay the price for his sloppiness. I am totally unsympathetic to him.

I agree about all of it, I also don’t understand the OP’s not liking realtor A. Realtor A should also realize her new client isn’t going to work and cut your loses and move on. If she’s half decent at her job, she’ll already have many other clients she’s already working with. I have clients who each owe me up to $1k and I realized long ago I’m not getting paid. I move on and go make more money elsewhere. It’s a part of business.

[Glenfield]

Originally Posted by wamer27

I agree about all of it, I also don’t understand the OP’s not liking realtor A. Realtor A should also realize her new client isn’t going to work and cut your loses and move on. If she’s half decent at her job, she’ll already have many other clients she’s already working with. I have clients who each owe me up to $1k and I realized long ago I’m not getting paid. I move on and go make more money elsewhere. It’s a part of business.

I think she has cut her losses and isn’t putting more effort into it. If the OP wants her to take the time to cancel the contract, he’ll need to make sure she gets paid is all.