Transaction Fees? (buyer's agent, commission, Realtors, insurance)

[VickiR]

I am in Raleigh, NC. I've recently had two closings where the attorney asked me how much I wanted to charge for a "transaction fee".

I don't charge a transaction fee to my buyers or to my sellers.

My question is...do alot of other Realtors or companies charge a transaction fee? I thought this was done in Florida years ago and it was determined to be illegal?

I have heard that there are now two companies in my area that are requiring their Agents to charge transaction fees. Who gets this fee? The Agent or the company?

Vicki

[HeatherKlein]

We charge a transaction fee to our agents to cover EOM insurance - $100 a deal.

[VickiR]

This is a transaction fee that is paid by either the seller or the buyer TO the agent/company.

Vicki

[faabala]

It is not happening to my knowledge in our Market to the south of you. I think it would a bad selling point for the company when it becomes common knowledge. I know I would let customers know the XXX company would charge them more than my company.

[Brandon Hoffman]

Originally Posted by VickiR

This is a transaction fee that is paid by either the seller or the buyer TO the agent/company.

Vicki

We don't have a transaction fee paid to the RE company by anyone in my market that I'm aware of. As a matter of fact, I believe a real estate company just lost a very expensive law suit over that very thing. It was being charged in addition to the commission with no additional services justifying the fee. I'd recommend avoiding it because it is just asking for a lawsuit.

[TampaKaren]

Transaction fees are still prevelant in Florida. I've never charged buyer nor seller, but I've been charged by the listing brokers on many transactions. It's anywhere from $250 to $395. It's fleecing IMO. Isn't x% enough? I guess not.

[VickiR]

I agree...I wouldn't charge it.

I spoke with an agent at one of the companies that charges the transaction fee (Prudential). She is against it, as well. However, if she doesn't get her buyer/seller to pay it, UPFRONT, she has to pay the company, herself.

Her opinion is that her company is charging it UPFRONT in case the buyer doesn't buy or the seller takes his home off the market and it covers the expense the company has had.

I don't agree. I won't charge my buyers or my sellers.

Yes, on occassion, we all get a buyer that we spend many hours and many tanks of gas, showing homes to and they don't buy. However, we also get that buyer who goes to the onsite agent and tells that agent that we are their buyer's agent and so I feel that it equals out.

I can understand why a company would want to charge a seller an upfront fee. In this market, many sellers will take their home off the market when they realize they aren't going to get the price they had hoped for. Or, situations change. Sellers change their mind. Companies have the expense of advertising, etc. and don't get paid if the seller changes his mind.

I chalk that up to the cost of doing business BUT in this economy, companies want to lower their expenses.

Again, I am NOR for these transactions fees.

My reason for posting this was to gain information and to open this up for discussion.

Vicki

[HomeHuntress]

I'm in Raleigh too Vicki and haven't seen or heard of this fee. Smells like a sad attempt for firms to generate revenue because sales are down (i.e a junk fee).

[cheryjohns]

It is a BS fee, only there to rev up the revenue for the broker, not the agents. When our company started this a year ago ($95), they lost some agents over it. I like the company otherwise, and I pay it, I don't pass it on to my clients because it IS BS. The reason given to us was that they had to store transactions for a long time and this covered storage fees. Uh huh - that might have worked back in the day everything was hard copy - and the company would have to rent tons and tons of storerooms and buy file cabinets - but with today's technology, it is done very inexpensively now - so that explaination doesn't really fly.

Some companies here in town charge a LOT more. One of the Prudential offices charge $495 - and if the agent doesn't get it from the client, the agent has to pay the company. It should be illegal. It's a total junk fee - so someone is getting shaken down - either the client or the agent.

[VickiR]

Thanks for sharing that information, cheryjohns.

That sounds like what the Prudential agent in Raleigh told me.

I do agree, it sounds like BS. I wondered if it was something new. Sounds like it may be coming this way. I don't like it.

Vicki