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Old 07-02-2009, 07:47 AM
 
12 posts, read 54,731 times
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Hi All,

I am making an offer on a short sale in N. VA, my broker's agreement, that I am to sign, states that I am responsible for the 3% or per MLS commission, should the seller (bank) not provide that, plus a $295 fee.

I told my agent I was concerned that if the bank paid less than 3% I would be on the hook for the difference and she told me that she would not come after me for the difference.

Question: is it standard to sign with such language or would I add an addendum stating what she mentioned verbally?

Thanks!
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Old 07-02-2009, 07:57 AM
 
11 posts, read 33,689 times
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I know nothing about buyer-broker agreements but I do know this. DO NOT SIGN ANYTHING unless you agree to ALL of the conditions on the contract. By signing it you are stating that you agree with all of the terms and that you will follow through with it. There is no such thing as a verbal agreement and that will not hold up if they say you need to pay the fee. So I wouldn't sign it unless you make up an addendum or something stating you don't have to pay the difference. Better to be safe then sorry. And make sure they black out the part on the agreement that states you need to pay the difference as well.
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Old 07-02-2009, 08:39 AM
 
Location: Sterling, VA
1,059 posts, read 2,629,430 times
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There's an old saying "If it is writing you have a prayer, not in writing-you have nothing but air". A verbal contract is not enforceable in the state of VA. Ask that the provision about you making up the difference in commission be stricken and changes initialed if you do not intend to pay it. Do the same with the administrative fee if you do not want to pay it. I am not going to give my opinion on these clauses on a public forum, if you want to know my opinion DM me.
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Old 07-02-2009, 09:22 AM
 
1,624 posts, read 4,337,238 times
Reputation: 1292
Quote:
Originally Posted by New York10 View Post
Hi All,

I am making an offer on a short sale in N. VA, my broker's agreement, that I am to sign, states that I am responsible for the 3% or per MLS commission, should the seller (bank) not provide that, plus a $295 fee.

I told my agent I was concerned that if the bank paid less than 3% I would be on the hook for the difference and she told me that she would not come after me for the difference.

Question: is it standard to sign with such language or would I add an addendum stating what she mentioned verbally?

Thanks!
The $295 is a junk fee that is increasingly becoming common. I would guess 90% of buyers agents will waive this fee if you ask. If they don't, I'd seriously consider getting a new agent.

Your contract is with the BROKER, not the agent. So your agent is correct that SHE would not come after you, but the BROKER probably will.

Anyways, that language is pretty common. It's because banks always try to reduce buyer agent fees. Most experienced short sale agents refuse and the banks almost always cave in and pay the full 3%. Without that clause, the buyer would have no incentive to challenge the fee reduction and might put tremendous pressure on your agent and broker to reduce their fees, when in all likelihood it's probably unnecessary.

I might see if I could reduce the out of pocket fees to 2% and maybe payable over a period of time. If your agent is any good, they will probably refuse but you never know. Also, they might require any fee reduction to you is contingent upon an initial refusal of the bank's demand for a agent fee reduction.

Anyways, if the bank really insists on a fee reduction, it is really the same thing as them wanting a 1 to 3% increase in price. So you can always counteroffer with a price reduction to factor in any buyer agent fees that need to be paid.
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