Realtor (settlement) rebate and Miller & Smith (sale, mortgage)

[vauser]

My realtor is telling me now (as opposed to at the beginning) that M & S do not allow the 2% realtor commission rebate based on HUD-1 while most other builders do.

Is this really true? If yes, what are my options? We didn't use the realtor at all for any of the search and research and simply had them as a body since they promised this rebate. Feel stupid now :-(

[boyd888]

The realtor should mail you a check soon after closing for your 2% rebate. It's pretty common to receive the rebate after closing. See if you can get something in writing just to confirm it.

[Jon_In_NOVA]

I used I-Agent over the summer when I bought my house, about a week after closing I got a certified Realtor check in the mail for 2% ($11,000) of the sale price......I was exstatic that it all actually worked out according to plan.

[Margery]

Originally Posted by Jon_In_NOVA

I used I-Agent over the summer when I bought my house, about a week after closing I got a certified Realtor check in the mail for 2% ($11,000) of the sale price......I was exstatic that it all actually worked out according to plan.

Just curious, did you have to declare that $11,000 as income?

[GoHokiesGo]

Originally Posted by Jon_In_NOVA

I used I-Agent over the summer when I bought my house, about a week after closing I got a certified Realtor check in the mail for 2% ($11,000) of the sale price......I was exstatic that it all actually worked out according to plan.

We've used I-agent twice as well to purchase property (ours and my in-laws), and they delivered promptly with the rebate both times. Our rebates were also cut as checks after the closing had occured, so it wasn't reflected anywhere on the HUD document. They typically wait until the money clears the escrow account from the closing/title company and hits their account prior to cutting a check for your rebate. They were a good group of guys and we enjoyed working with them, I'm not sure who else has an advertised rebate in the area outside of I-agent and Redfin.

[LetsRock]

Originally Posted by Margery

Just curious, did you have to declare that $11,000 as income?

How is that income? It is rolled into the mortgage and is just a refund.

[Jon_In_NOVA]

Originally Posted by LetsRock

How is that income? It is rolled into the mortgage and is just a refund.

Like the above poster stated, it is not declared on the HUD and a check was cut to me after closing. Thus not needing to declare anything for tax purposes. They have all the supporting IRS documentation to show potential clients their motives are on the up and up.

But yeah either way, I-Agent was just as good if not better then a traditional agent to us. If you would like our reference feel free to shoot me a PM.

[boyd888]

Originally Posted by Margery

Just curious, did you have to declare that $11,000 as income?

This is actually an interesting question. If the rebate is reflected directly on the HUD-1, then it is considered a reduction in the purchase price and does not need to be reported. This was confirmed by the IRS a couple of years ago at Redfin's request.

Now if you receive a check in the mail AFTER closing and nothing is listed on the HUD-1. You should still be ok, but you may need to provide additional documentation to show that it was a rebate and not income, especially if you get sent a 1099.