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I have worked on and off with a real estate agent that I later found was not working in my best interest. In a buyers market she would always have me make offers above the asking price, search their website for a home (never giving me personal leads), and with a nasty attitude informed me that I was to have more than one home to view or else it wasn't worth her time to show a single home. I believe that her intentions were to collect the most amount of commission from the sale, thus the strong advice to always offer more than the asking price.
To get onto the issue at hand. Within the past few months buried within the paperwork placing an offer on a home was a Buyers Agency Agreement. This document was never explained to me and was mixed in with the offering paperwork. I have since then aquired another agent and will be closing on a home. The original real estate agent is claiming breach of contract and wants a percentage of the sale price of the home. Mind you, the home being purchased was never listed with the original real estate agent, she never gave us any information on the home, never showed the home to us, never gave us the address of the home. To sum it up, the original real estate agent had absolutely nothing to do with the home that I will be purchasing and yet wants commission from the sale.
The following is verbage from the Buyer Agency Agreement, in my opinion the original real estate agent should not be allowed to collect one cent from the sale but I'm asking for advice here, please:
"4. TERM/CANCELLATION This Agreement is entered into as of 24 day of August Thus Agreement shall expire on November 24, 2009. This Agreement may be cancelled only by the mutual consent of the parties in writing.
5. COMPENSATION OF BROKER IN consideration of the services to be performed by Broker, Client agrees to pay Broker as follows (check as applicable)
(d) Commission In the event Client contracts to purchase the Desired Property, Client will pay Broker a Commission equal to 2.75% of the purchase price. The Commission is due and payable upon closing. The Commission shall apply to any purchase agreements executed during the term of this Agreement, or during any extension of this Agreement. The Commission will also apply to purchase agreements executed within 3 months after the expiration or other termination of this Agreement, if the property acquired was presented to Client through the services of Broker. the seller fails to close with no fault on the part of Client, then the Commission shall be waived. If the transaction does not close because of any fault on the part of the Client, the Commission shall NOT be waived and shall become immediately due and payable."
The offer fell through on the home that the agreement was based on and no further action was taken on purchasing this home. The original real estate agent returned the earnest funds to me, afterwards I decided to search for another real estate agent.
Now, as the original real estate agent had not shown me or given me any knowledge of the home that I am about to close on, does she have the right to demand the percentage at closing?
Thnks,
Michigan Sue
Last edited by Susan1024a; 10-29-2009 at 05:03 PM..
Agree, lawyer time. You need a lawyer to review the entire agreement as different sections may interact and affect interpretation. This statement seems pretty clear: "The Commission shall apply to any purchase agreements executed during the term of this Agreement, or during any extension of this Agreement.", but a lawyer may find something else to change how it is applied. You should also discuss your concerns with her broker to see if they may be willing to work something out. Moral of the story - always read the documents you sign.
I have worked on and off with a real estate agent that I later found was not working in my best interest. In a buyers market she would always have me make offers above the askingprice, .....
Within the past few months buried within the paperwork placing an offer on a home was a Buyers Agency Agreement. This document was never explained to me and was mixed in with the offering paperwork.
I have since then aquired another agent and will be closing on a home.
The original real estate agent is claiming breach of contract and wants a percentage of the sale price of the home. Mind you, the home being purchased was never listed with the original real estate agent, she never gave us any information on the home, never showed the home to us, never gave us the address of the home. To sum it up, the original real estate agent had absolutely nothing to do with the home that I will be purchasing and yet wants commission from the sale.
The following is verbage from the Buyer Agency Agreement,
"4. TERM/CANCELLATION This Agreement is entered into as of 24 day of August Thus Agreement shall expire on November 24, 2009. This Agreement may be cancelled only by the mutual consent of the parties in writing.
The offer fell through on the home that the agreement was based on and no further action was taken on purchasing this home.
Just curious.....
How did Agent #1 make you make offers above the asking price? Assuming you did so, why did the deal fall apart?
How did the broker/agent #1 know you are under contract to buy a different place, given you have not yet closed?
And now for the challenge. Sounds like you signed a contract you did not understand and you did not seek a mutual consent to be released from it. BTW, I have never seen a buyer's agency agreement like this but that's neither here nor there.
Ask your attorney to contact Agent #1's Managing Broker to work this out.
I have worked on and off with a real estate agent that I later found was not working in my best interest. In a buyers market she would always have me make offers above the asking price, search their website for a home (never giving me personal leads), and with a nasty attitude informed me that I was to have more than one home to view or else it wasn't worth her time to show a single home. I believe that her intentions were to collect the most amount of commission from the sale, thus the strong advice to always offer more than the asking price.
To get onto the issue at hand. Within the past few months buried within the paperwork placing an offer on a home was a Buyers Agency Agreement. This document was never explained to me and was mixed in with the offering paperwork. I have since then aquired another agent and will be closing on a home. The original real estate agent is claiming breach of contract and wants a percentage of the sale price of the home. Mind you, the home being purchased was never listed with the original real estate agent, she never gave us any information on the home, never showed the home to us, never gave us the address of the home. To sum it up, the original real estate agent had absolutely nothing to do with the home that I will be purchasing and yet wants commission from the sale.
The following is verbage from the Buyer Agency Agreement, in my opinion the original real estate agent should not be allowed to collect one cent from the sale but I'm asking for advice here, please:
"4. TERM/CANCELLATION This Agreement is entered into as of 24 day of August Thus Agreement shall expire on November 24, 2009. This Agreement may be cancelled only by the mutual consent of the parties in writing.
5. COMPENSATION OF BROKER IN consideration of the services to be performed by Broker, Client agrees to pay Broker as follows (check as applicable)
(d) Commission In the event Client contracts to purchase the Desired Property, Client will pay Broker a Commission equal to 2.75% of the purchase price. The Commission is due and payable upon closing. The Commission shall apply to any purchase agreements executed during the term of this Agreement, or during any extension of this Agreement. The Commission will also apply to purchase agreements executed within 3 months after the expiration or other termination of this Agreement, if the property acquired was presented to Client through the services of Broker. the seller fails to close with no fault on the part of Client, then the Commission shall be waived. If the transaction does not close because of any fault on the part of the Client, the Commission shall NOT be waived and shall become immediately due and payable."
The offer fell through on the home that the agreement was based on and no further action was taken on purchasing this home. The original real estate agent returned the earnest funds to me, afterwards I decided to search for another real estate agent.
Now, as the original real estate agent had not shown me or given me any knowledge of the home that I am about to close on, does she have the right to demand the percentage at closing?
Thnks,
Michigan Sue
In bold above..did you get that paperwork signed by both you and your previous agent ?
Not to be mean, but you signed those papers. Not understanding, after the fact, is not a valid excuse.
In bold above..did you get that paperwork signed by both you and your previous agent ?
Not to be mean, but you signed those papers. Not understanding, after the fact, is not a valid excuse.
I'll be contacting legal tomorrow. I have read into the agreement whereas it states "Client contracts to purchase the Desired Property" and this agreement was included with the home offer that fell through.
And there is the following:
"The Commission will also apply to purchase agreements executed within 3 months after the expiration or other termination of this Agreement, if the property acquired was presented to Client through the services of Broker."
The home that will be closed on was NEVER shown by the original real estate agent, NEVER presented by the original real estate agent, and NEVER came forth with any knowledge of the home that will be closed upon. There was lack of professionalism and ethics from the original real estate agent. Again, I will get with legal in the morning, they will advise the course of action to take and also advise on if contacting the Board of Realitors should be deemed necessary.
The agents latest actions had pushed me over the edge to seek out a real estate agent that would work for me and my best interests in locating and purchasing a home. In fact my current real estate agent gathered all information from me, contacted me that night with a list of homes, and called me that evening asking if I would like to view any of the homes the next day. I found one that I loved, my current real estate agent worked on my behalf, staying in communications with the sellers agent and within a week lowered the price down $15,000 from the asking price, no work being needed on the home (3 separate inspectors).
I'll be contacting legal tomorrow. I have read into the agreement whereas it states "Client contracts to purchase the Desired Property" and this agreement was included with the home offer that fell through.
And there is the following:
"The Commission will also apply to purchase agreements executed within 3 months after the expiration or other termination of this Agreement, if the property acquired was presented to Client through the services of Broker."
The home that will be closed on was NEVER shown by the original real estate agent, NEVER presented by the original real estate agent, and NEVER came forth with any knowledge of the home that will be closed upon. There was lack of professionalism and ethics from the original real estate agent. Again, I will get with legal in the morning, they will advise the course of action to take and also advise on if contacting the Board of Realitors should be deemed necessary.
...
I'm glad you found an agent you like. However, I doubt your interpretations above of the contract will fly with your lawyer. Unless "Desired Property" was defined in writing as the specific property in your offer, it probably means any property that you desired to offer on. You, and I'm sure your lawyer will, should look for a definition in the agreement of Desired Property if there is one.
The 2nd statement only applies after your agreement expires, then it is limited to homes that were shown to you. While the contract is in force, it appears that it applies to any home you want to purchase regardless of who helped you find it. This is generally in place to protect the agent from losing out on commission when you visit open houses or sales centers without the agent you employed.
Good luck with your legal review. Again, I recommend also discussing with the agents managing broker. The broker is actually the one that controls the agreement, not the agent, and would be the one to go after commission.
Stories like this make me realize even more than ever that some Realtors are just blood sucking leeches lol I understand that everyone needs to make a buck and put food on the table, but to go after thousands of dollars on a sale that the Realtor had nothing at all to do with is just crazy in my opinion.
Good luck OP, I hope you don't have to give that agent .01 !!!
I'm glad you found an agent you like. However, I doubt your interpretations above of the contract will fly with your lawyer. Unless "Desired Property" was defined in writing as the specific property in your offer, it probably means any property that you desired to offer on. You, and I'm sure your lawyer will, should look for a definition in the agreement of Desired Property if there is one.
The 2nd statement only applies after your agreement expires, then it is limited to homes that were shown to you. While the contract is in force, it appears that it applies to any home you want to purchase regardless of who helped you find it. This is generally in place to protect the agent from losing out on commission when you visit open houses or sales centers without the agent you employed.
Good luck with your legal review. Again, I recommend also discussing with the agents managing broker. The broker is actually the one that controls the agreement, not the agent, and would be the one to go after commission.
Perhaps the broker might have a heart and realize that the real estate agent did not have my best interests in mind all the while. If there are any real estate reading this, how many of you would inform your clients to:
1. Check your website for for listings, not providing the client with a list of homes to view.
2. ALWAYS inform your client that if they truely want the home to place an offer ABOVE the asking price.
3. Inform your client that if they wanted a home shown that they would have to select more than one home in the area to make their trip worth coming out.
I'm sorry but the above appears to be a breach of contract on the agents side. Afterall aren't they suppose to look out for the best interests of the client and WORK for the client? Referring a client to a website and not actually searching for a home for thus client??? There were several homes that I was able to locate on the master list that were NOT on her website. After informing my new agent what we were looking for, what area, what price range, and other information, our new agent found our home the same day AND worked with the selling agent to reduce the price. This is something that our old real estate agent had never done! Now you tell me, who is in breach of contract here??? Well there's always talking to the broker and/or talking to the Board of Realitors (don't want to go down that road as I am not that type of individual but then again I believe in honesty and working for what I earn!).
Nowadays it's rare to have clients not bring a list of homes to view. I do not see that as a breech, unless it was spelled out in your BA agreement.
It's true that if you want a slam dunk acceptance, offer over asking, especially if you are asking for closing cost assistance.
I have had agency agreements with clients that did not want me to run comps, when I asked if I should. Because they already had a firm grip on the market in their mind.
If I were you. I would close on the home and wait. If you get a certified letter, hire an attorney. If not, forget about it. Chalk it up to a bunch of hot air. And choose your representation wisely in the future.
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