Discount Buyer's agents (Houston, New Home: comparable sales, flat fee, for sale by owner)

[berkeleyan]

I am planning to buy a >600K house and looking for a buyer's agent gives some of his/her commission back to the buyers (up to 2%). I found several websites that claim doing that as long as you are a prepared buyer. Do you have any experience working with these companies? Are they too good to be true?


Eagle Realty Discount Flat Fee MLS | For Sale by Owner | Houston, TX


https://www.flatfeegroup.com/Texas/


Houston Texas 2% new Home Buyer commission Rebate and Rebate Realtor 2% Cash Back.


https://usrealty.com/

[ipuck]

Redfin. Very satisfied with them.

[marksmu]

Originally Posted by berkeleyan

I am planning to buy a >600K house and looking for a buyer's agent gives some of his/her commission back to the buyers (up to 2%). I found several websites that claim doing that as long as you are a prepared buyer. Do you have any experience working with these companies? Are they too good to be true?


Eagle Realty Discount Flat Fee MLS | For Sale by Owner | Houston, TX


https://www.flatfeegroup.com/Texas/


Houston Texas 2% new Home Buyer commission Rebate and Rebate Realtor 2% Cash Back.


https://usrealty.com/

Be prepared to run into quite a bit of headwind from the Listing agents as well as the title companies. Rebates are 100% allowed in Texas but because they do not occur often, the way they are applied can have a big impact on whether or not you get the rebate if you are also getting financing.

For example - Im going to use even numbers here....but say you buy a $100,000 house and you are supposed to get a rebate of 2% or $2000....but you need a conventional loan for say 80%. The rebate can be applied one of two ways:

1) reduction of the purchase price in lieu of commission - the listing agent has to agree and 99/100 will NOT agree to this because their Brokers prohibit it and it lowers the comparable sales on the MLS.

2) Rebate from the buyers agent....This is the normal method...but there is a big catch here...Nearly ALL banks will NOT allow any cash TO the buyer from anyone to exceed 6% of the total cost....Ok - we are still fine, right?

Well, lets say that during inspections you find $6,000 in damages that need to be corrected and the seller does not want to fix it himself, (most do not) and wants to do cash in lieu of repairs. MOST realtors will refuse to adjust the sale price down b/c it affects their comps, but they are happy to do cash in lieu of repair....so the Seller is now contributing $6,000 to the Buyer at closing, which is 6% which means now that your Agent is forbidden by the LENDER (not law) from contributing his commission to you.

I do lots of rebates for my friends/family but I have run into all of the roadblocks....whether it is the bank or the listing agents broker - both seem intent on preventing rebates.

[berkeleyan]

Thank you for reply Marksmu. I will buy at least $600,000 house. 2% rebate from the real estate agent adds up to $12,000. 6% is $36,000. I will still have $24,000 for repairs which should be enough in most cases.

[Lbjen]

I've also used Redfin as a buyers agent and been happy (another state). If you've already found your house, or are at least capable of finding it yourself, and don't need a lot of hand-holding, they're great.

[Houston321]

They can just cut you a check and 1099 you to avoid closing cost, HUD issues.

[Failed Engineer]

I don't know how redfin does it, but they just sent me a check and a letter accompanying it saying a 1099 would not be issued as they had received a favorable ruling stating it did not have to be reported as income to the buyer. I can't find the letter at the moment but it was something to that effect.

They don't rebate 2% though. Closer to 1% and it's been going down gradually as they gain a foothold in the Houston market.

[jchildress]

I have used Stuart in the past and it worked great...

Stuart B. Scholer - Houston Texas Discount Real Estate Agent offers New Home Rebates, 2.5% Cash Back, Realtor Commission Rebates.

[wheretogo]

I never understood why the seller has to pay commission for BOTH seller agent and buyer agent. Let seller pay 3% to his agent for the work his agent does. If the buyer is requiring the service of a realtor, then let the buyer hire one and pay for it from the buyer pocket. If the buyer does not want arelator service for one of the biggest purchases in his life, he can do my himself. No money spend. No Problem.

[berkeleyan]

I totally agree with you wheretogo. Such a confusing and archaic system. Let the buyers pay for his/her realtor. It does not make sense to give all the power to seller's agent. Also, the sell price is not reported to HCAD so nobody knows how much a house is sold for. This confusing and non transparent system is greatly benefiting the realtors. If we did not have such a confusing system, technology would already take over and make the system very fast and efficient. Look at the huge drop in commissions for buying and selling stocks over the years because of technology. We need similar transformation in real estate transactions.