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Old 08-08-2012, 09:15 AM
 
3,404 posts, read 4,144,741 times
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Quote:
Originally Posted by marksmu View Post
Silverfall - I also would use you when selling a home.

What most realtors dont seem to grasp is that sometimes a Buyer wants to do things the way he wants to do them. If its not the exact same procedure every single time many of the agents/brokers throw their arms up and say its not worth their time.

If Hindukid is comfortable buying without an agent and wants to negotiate his 3% why not let him?
If the seller agreed to a 6% if represented, why not take your 3% and credit him 3% its no skin off your back....the additional work IS negligible, despite what everyone says, and the additional liability can EASILY be contracted away. None of it is hard.

If the listing agents are so good at getting the best price for their seller when the buyer comes unrepresented , which is their fiduciary duty anyway, why not be happy about that and give the other 3% away - Especially if it nets your Seller more money in the end? Your DUTY is to the principal, even if that comes at your expense....that is specifically spelled out in the statutes of Texas, and I am sure it is the same in every State.

The bottom line is that a buyer and a seller should both be viewed as customers....The listing agent is offering to sell a property for his client (Customer 1) - its the listing agents job to be sure that the buyer (customer 2) is happy with the transaction or he wont buy.

If your seller would go down 10% but you are able to please your customer by just giving in 3% then everyone won! Your Seller got more money, you received your expected commission of 3%, and the Buyer walked away from the transaction Happy.

Instead of buying/selling being confrontational and as huge a pain to deal with as it currently is, a simple attitude adjustment such as Silverfall has made will most likely net you the Agent more money, and your Customers - Buyer & Seller will have good things to say about you....if instead you rigidly stick to your I keep 6% come hell or high water, then well you certainly angered the buyer who will in turn bad mouth you and your agency to all of his friends - thus alienating you from a group of 20 or more potential future clients....

I personally have a list of near 20 realtors/brokers who I tell everyone who asks me who they should use to sell their home to avoid. With the number of transactions and referrals I give to employees & friends I can assure these Agents/Brokers lost future listings by being rigid jerks in their dealings with me.
I think it is understood that a commission can't be paid directly to a buyer in some states. It really depends where you are. What the OP was trying to accomplish was to make his offer look better by having the listing agent take less commission therefore increasing the sellers bottom line. What some don't seem to get is that it isn't for the buyer to negotiate commission that is already agreed on between seller and listing agent.

Last edited by Zyngawf; 08-08-2012 at 09:29 AM..

 
Old 08-08-2012, 09:22 AM
 
1,726 posts, read 2,278,928 times
Reputation: 3424
Quote:
Originally Posted by Captain Bill View Post
What RE Skeptic, Hindukin, and others fail to understand is that the commission rate agreed on by the seller and listing agent is the pay to that listing agent to sell the home. "Owner agrees to pay Broker xx%". The language is very clear.

No matter how the agent sells the house, the full agreed on commission is payable to the listing agent.

There is also a place in the new AZ listing agreement with fields which states Broker intends to cooperate with all other Brokers, except when not in Owners best interest: and Broker will offer xx% to a buyers Broker who represents the interest of the Buyer.

Note that it is the listing Broker who agrees to pay the buyers Broker (out of the listing brokers commission)

In no way does the listing agent or the seller agree that the listing agent will cooperate and pay a fee to an unrepresented buyer. The listing agent and seller have only agreed that the listing agent will pay a cooperating Broker xx%.
I dont think anyone does not understand this. It is very clear.

Quote:
Originally Posted by Captain Bill View Post
If the listing agent and seller both agree that the listing agent may work as a dual agent, then they will normally negotiate a fee that the listing agent will receive in that event and place that in the additional terms section.

I'm sure there are many agents who will agree to a reduced amount to act as a dual agent. (I will act as a dual agent in some circumstances, depending on the attitude of both buyer and seller, and provided that both clearly understand that my role changes due to the inherent conflicts in fiduciary duties.)
You accepting a contract from an unrepresented buyer does NOT mean you are acting as a dual agent. You keep saying this, but it is NOT a true statement. All you have to do is send your agency letter that clearly says you are not representing the buyer and your additional risk and liability are 100% contractually eliminated. You continue to repeat this over and over and over again that its not worth the liability, etc etc, but the LEGAL answer is that once you have sent the letter and you are careful to act only on your clients behalf - there is no dual agency.

Quote:
Originally Posted by Captain Bill View Post

There is no provision in the listing agreement, nor should there be, for the listing agent to pay a commission to an unrepresented buyer, because the buyer is not a licensed agent and is not entitled to a commission. Nor should the listing agent have to negotiate a lower rate for an unrepresented buyer, because there is too much risk.
Again this is just not true. There is no additional risk if you do your job correctly and by the books.

Quote:
Originally Posted by Captain Bill View Post
Here's something that Sellers should consider:


A seller should realize
that if he comes back to the listing agent and says, you need to reduce your commission so I can sell to this unrepresented buyer to save him money and put more in my pocket. I understand it's increasing your risk and work load, but if you don't agree, then I'll bad mouth you to all my friends. So if the agent reluctantly accepts this cut, how much incentive will that agent have to negotiate hard to get the seller a better deal from buyer. Probably not much. So the seller may end up netting a lot less.
And the realtor has breached his fiduciary duty to do his absolute best for the SELLER even when the best that he can do means that he himself must make a sacrifice. So the agent can lose his license....thats exactly the type of Agent I avoid at all cost and the type that makes my list of blacklisted agents.

Quote:
Originally Posted by Captain Bill View Post
In addition, the agent may have a vendetta against this unrepresented buyer who interfered with his third party contract, and there are lots of legal ways he can cause damage to that buyer during the transaction. The only thing the agent owes that buyer is honesty and fair dealing. And that does not mean holding his hand during escrow. So the buyer better have more knowledge about real estate law and transactions than most of the people who think that because they can search on Zillow to find a house that they are real estate experts.

Want a commission? Get a real estate license!!!
I'm not trying to be confrontational, but this statement right here is exactly why realtors get bad names and get bad mouthed...If you went in to every transaction with the expectation of only making 3% your feelings should not be hurt by only making 3%.

It is legal for the Broker to share 3% of the commission with a PRINCIPAL to the transaction....the Buyer IS a Principal. I looked this up for Texas...I bet its the same in Arizona. If you as the Broker are unwilling to share the Buyers 3% while contractually eliminating your additional liability then you are the type of Broker I will avoid. I frequently tell employees that they need to spell this out. I have an addendum that I have made that I give them to hand to their listing agents...if they refuse it, I tell them to find another agent....I have 3 agents that I refer people to, and all 3 make more money than they otherwise would b/c I refer so many people to them. Its win/win.
 
Old 08-08-2012, 09:29 AM
 
1,726 posts, read 2,278,928 times
Reputation: 3424
Quote:
Originally Posted by Zyngawf View Post
I think it is understood that a commission can't be paid directly to a buyer. What the OP was trying to accomplish was to make his offer look better by having the listing agent take less commission therefore increasing the sellers bottom line. What some don't seem to get is that it isn't for the buyer to negotiate commission that is already agreed on between seller and listing agent.
A commission can be paid to a principal in a transaction....the buyer is a principal...thus all the Broker must do is agree that he share his 6% with an unrepresented Buyer...It has nothing to do with interfering with a contract between the seller and the Broker.

Brokers/Agents just plain and simple do not like it.
 
Old 08-08-2012, 09:29 AM
 
Location: DFW - Coppell / Las Colinas
29,976 posts, read 34,597,527 times
Reputation: 35990
Quote:
Originally Posted by Captain Bill View Post
What RE Skeptic, Hindukin, and others fail to understand is that the commission rate agreed on by the seller and listing agent is the pay to that listing agent to sell the home. "Owner agrees to pay Broker xx%". The language is very clear.

No matter how the agent sells the house, the full agreed on commission is payable to the listing agent.

There is also a place in the new AZ listing agreement with fields which states Broker intends to cooperate with all other Brokers, except when not in Owners best interest: and Broker will offer xx% to a buyers Broker who represents the interest of the Buyer.

Note that it is the listing Broker who agrees to pay the buyers Broker (out of the listing brokers commission)

In no way does the listing agent or the seller agree that the listing agent will cooperate and pay a fee to an unrepresented buyer. The listing agent and seller have only agreed that the listing agent will pay a cooperating Broker xx%.
Bill... just don't understand what's so hard to understand about the above. Good post.

We (Seller and Broker) enter into an agreement voluntarily and with a choice to negotiate the terms. Don't like the agreement ? Don't agree to it and shop around for someone who will do it different. Luckily here in the US we're still free to choose our Lawyer, Dentist, Plumber or RE Agent.

How many times do we need to answer OP's question ? The Buyer does not know our agreed upon fee to sell a home. The Seller has agreed with the fee and we as professionals should expect our fee to be paid. In a standard agreement, the Fee agreed is to get the house sold. Period.

OP... if you want the seller to consider a reduction in the commission they are paying to benefit you then figure out a way to put it in the Special Provisions of the contract. Be direct and not through some type of verbal or email communication that the Seller may not see.

Your offer then can be accepted or rejected on it's own merit. More than likely a seller will see through your attempt at reducing the price and counter you with what they can legally and monetarily afford. Be prepared to be told NO since you've asked the seller to go against what he has contractually agreed.

The seller might want to pay me 10% to deal with a Nut Job Buyer. (we see them all the time)
 
Old 08-08-2012, 09:43 AM
 
2,635 posts, read 4,353,779 times
Reputation: 2080
Quote:
Originally Posted by marksmu View Post
Silverfall - I also would use you when selling a home.

What most realtors dont seem to grasp is that sometimes a Buyer wants to do things the way he wants to do them. If its not the exact same procedure every single time many of the agents/brokers throw their arms up and say its not worth their time.

If Hindukid is comfortable buying without an agent and wants to negotiate his 3% why not let him?
If the seller agreed to a 6% if represented, why not take your 3% and credit him 3% its no skin off your back....the additional work IS negligible, despite what everyone says, and the additional liability can EASILY be contracted away. None of it is hard.

If the listing agents are so good at getting the best price for their seller when the buyer comes unrepresented , which is their fiduciary duty anyway, why not be happy about that and give the other 3% away - Especially if it nets your Seller more money in the end? Your DUTY is to the principal, even if that comes at your expense....that is specifically spelled out in the statutes of Texas, and I am sure it is the same in every State.

The bottom line is that a buyer and a seller should both be viewed as customers....The listing agent is offering to sell a property for his client (Customer 1) - its the listing agents job to be sure that the buyer (customer 2) is happy with the transaction or he wont buy.

If your seller would go down 10% but you are able to please your customer by just giving in 3% then everyone won! Your Seller got more money, you received your expected commission of 3%, and the Buyer walked away from the transaction Happy.

Instead of buying/selling being confrontational and as huge a pain to deal with as it currently is, a simple attitude adjustment such as Silverfall has made will most likely net you the Agent more money, and your Customers - Buyer & Seller will have good things to say about you....if instead you rigidly stick to your I keep 6% come hell or high water, then well you certainly angered the buyer who will in turn bad mouth you and your agency to all of his friends - thus alienating you from a group of 20 or more potential future clients....

I personally have a list of near 20 realtors/brokers who I tell everyone who asks me who they should use to sell their home to avoid. With the number of transactions and referrals I give to employees & friends I can assure these Agents/Brokers lost future listings by being rigid jerks in their dealings with me.
As a non-agent and non-attorney, I think this is all helpful input to those who will listen. My input would be that anyone developing a policy needs to build in flexibility so as not to shoot himself/herself in the foot when an excellent opportunity (e.g., a well-qualified unrepresented buyer appears with little or no LA effort, where other qualified buyers are few and far between) presents itself and rigidity does not allow the broker, LA, seller, and buyer to work out a deal that benefits everyone. For example, it doesn't have to be a 3%+3% versus 3%+0% situation. Instead the policy could allow for 3%+1% to the LA to compensate the LA for the small amount of additional work necessary.
 
Old 08-08-2012, 09:46 AM
 
3,404 posts, read 4,144,741 times
Reputation: 2397
Quote:
Originally Posted by marksmu View Post
A commission can be paid to a principal in a transaction....the buyer is a principal...thus all the Broker must do is agree that he share his 6% with an unrepresented Buyer...It has nothing to do with interfering with a contract between the seller and the Broker.

Brokers/Agents just plain and simple do not like it.
Rules vary from state to state.

If there is a contract between seller and broker no one else can interfere and it has to be honored unless broker and seller both decide to change it. The time to negotiate this stuff is ahead of time before there is a buyer. Some potential buyers on here plain and simple do not like that. Mark, if you like working for free or near nothing I think that's foolish, but it's your choice. For you to expect it of other people just isn't realistic.

One thing I want to say though is that I don't any of this would ever turn into any lawsuit. The buyer can't interfere because he isn't part of the listing contract. If one party decides not to honor a contract then maybe there's a case(it would be seller or broker), but people reading these threads may come to the conclusion that they happen all over the place in the real estate world and they really don't. Who would really want to take the time and money to file over this? Iv' been in this business a long time and don't know anyone that has been sued.
 
Old 08-08-2012, 10:02 AM
 
1,726 posts, read 2,278,928 times
Reputation: 3424
Quote:
Originally Posted by Zyngawf View Post
Rules vary from state to state.

If there is a contract between seller and broker no one else can interfere and it has to be honored unless broker and seller both decide to change it. The time to negotiate this stuff is ahead of time before there is a buyer. Some potential buyers on here plain and simple do not like that. Mark, if you like working for free or near nothing I think that's foolish, but it's your choice. For you to expect it of other people just isn't realistic.
I still think you have missed the point. The Seller and Broker did negotiate it ahead of time. The OP is asking the Broker to credit the buyers portion of the commission (if it applies) to him. Since he is a principal to the transaction this IS allowed.

The listing agent is not working for free..The LA is working for 3%...the same 3% he/she should have expected to make in the first place....its just the Brokers really do not like it...they feel like they lost money when they had to credit it to the Buyer from their commission amount.

Nowhere does there have to be any of this outrage, there is no Tortious Interference, there is no animosity, its just the buyers portion being credited to the Buyer from the Listing Broker. Its very simple....Brokers/Agents just do not like it b/c they are afraid it will become the norm and then more people will want to do it, and then they have fewer clients and thus less money. Its protection of their profession above the best interests of their clients.
 
Old 08-08-2012, 10:13 AM
 
Location: Needham, MA
6,326 posts, read 9,050,368 times
Reputation: 5324
This post is so ridiculous I don't even know where to start.

Quote:
Originally Posted by marksmu View Post
What most realtors dont seem to grasp is that sometimes a Buyer wants to do things the way he wants to do them. If its not the exact same procedure every single time many of the agents/brokers throw their arms up and say its not worth their time.
This is absolutely ridiculous. Wouldn't you think that real estate agents and the attorneys they employ through their Realtor organization have developed tried and true, court tested contracts and methodologies? If someone wants to do it a different way than I'm doing it, they should have their head examined because they're opening themselves up to a lawsuit or perhaps are even doing it outside of the requirements of state law.

Quote:
Originally Posted by marksmu View Post
If Hindukid is comfortable buying without an agent and wants to negotiate his 3% why not let him?
If the seller agreed to a 6% if represented, why not take your 3% and credit him 3% its no skin off your back....the additional work IS negligible, despite what everyone says, and the additional liability can EASILY be contracted away. None of it is hard.
You seem to know the job a real estate agent inside and out or at least you claim to. Have you ever worked as one? Do you truly know what I do or the sacrifices I make to insure that my clients are as happy as possible? I absolutely have more to do when I'm the only agent involved. The risk of exposing myself to additional risk is also exponentially more. You say "just do it the right way and there won't be more risk." Of course! Why didn't I think of that? The risk is still there. It takes extra effort to make sure all my T's are crossed and I's dotted to insure I'm not exposed to that risk no matter what paper I have the unrepresented buyer sign. If something goes wrong in a transaction who do you think gets scrutinized first? It's not going to be the buyer.

If Hindukid wants to negotiate some of the commission back from the listing agent, I don't have a problem with that. But don't contact my seller to do it. He's hired me because he doesn't want to talk to you.

Quote:
Originally Posted by marksmu View Post
If the listing agents are so good at getting the best price for their seller when the buyer comes unrepresented , which is their fiduciary duty anyway, why not be happy about that and give the other 3% away - Especially if it nets your Seller more money in the end? Your DUTY is to the principal, even if that comes at your expense....that is specifically spelled out in the statutes of Texas, and I am sure it is the same in every State.
This is by far the most non-sensical part of your post. I have a contract with my client. It says basically I get him the best deal possible. If I do that, I get x%. If there is no agent I get x% + y% (please note I did not write x times 2 as you lay people incorrectly think we get double commission which is often not the case). This is the price for services rendered that has been negotiated and agreed to by the seller. We have established services and fee rate. So, everyone is happy. Now please explain to me how it's still my fiduciary duty to automatically cut my pay when someone shows up without an agent. I've used my commission in the past whether I'm getting one side or two to make a deal happen and this is a tool I will continue to use. However, you and others who post here think I should just automatically take a pay cut.

Quote:
Originally Posted by marksmu View Post
The bottom line is that a buyer and a seller should both be viewed as customers....The listing agent is offering to sell a property for his client (Customer 1) - its the listing agents job to be sure that the buyer (customer 2) is happy with the transaction or he wont buy.
I'm sorry but if I'm not acting as a dual agent then the buyer is not my client. I'm going to hit them in the wallet and make it sting. Of course, I'm going to be sweet as pie while doing it. You won't know what hit you so much that you'll probably call me in a few years to sell the house.
 
Old 08-08-2012, 10:14 AM
 
Location: DFW - Coppell / Las Colinas
29,976 posts, read 34,597,527 times
Reputation: 35990
Quote:
Originally Posted by marksmu View Post
The listing agent is not working for free..The LA is working for 3%...the same 3% he/she should have expected to make in the first place....its just the Brokers really do not like it...they feel like they lost money when they had to credit it to the Buyer from their commission amount..
Wrong... the Listing Broker is working for 6%. He's willing to share it with another Broker for a qualified Buyer. You just think 6% is too much to charge and many agents may only charge 3-5% to get the home sold.
 
Old 08-08-2012, 10:18 AM
 
Location: DFW - Coppell / Las Colinas
29,976 posts, read 34,597,527 times
Reputation: 35990
Quote:
Originally Posted by marksmu View Post
A commission can be paid to a principal in a transaction....
You are in TX where this is true but if you are really an attorney you'd realize State laws vary. Many states it's illegal to pay money back to a principal.
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