Extra Real Estate Agent fees? (appointed, HOA, insurance)

[Captain Bill]

In my personal opinion the $695 fee is high and should not be charged in a traditional sale. Both the buyer and seller must be aware if the agent is being paid by more than one party. Certainly, like commissions it's negotiable, unless an office policy requires it and the office won't make an exception.

It is entirely possible that this is an office policy where the agent may have no choice in the matter. While the agent is an independent contractor as far as the tax laws are concerned, she is still employed by the brokerage and subject to the brokerage policy manual. The brokerage can set a standard commission rate for the office that all agents are required to charge; and they can also require the office agents to charge an admin fee.

This is the first time I've run across and admin fee in a traditional sale. I usually see it in short sales where the agent has an attorney involved in the process. There they call it a short sale negotiation fee chargeable to the buyer. It's disclosed on the mls listing, usually in the private or semi-private Realtor remarks, and the buyers agent must advise the buyer of that fee.

[Zippyman]

I'd probably pay it, then sue for it's return in small claims court.

You might win, you might not, but the broker will have to appear & explain themselves, and that in itself should be worth $695...

There's also a commissioner's rule at the department of real-estate that states that a licensee isn't allowed to interfere with\jeopardize a closing due to a commission dispute with another licensee - since this agent is acting like a "double agent" (buy and seller agent), it seems they may be violating that rule if they're refusing to present your offer.

Complaints cost $0, no reason not to drop a dime on them.

[MN-Born-n-Raised]

Originally Posted by Captain Bill

This is the first time I've run across and admin fee in a traditional sale. I usually see it in short sales where the agent has an attorney involved in the process. There they call it a short sale negotiation fee chargeable to the buyer. It's disclosed on the mls listing, usually in the private or semi-private Realtor remarks, and the buyers agent must advise the buyer of that fee.

I can see why buyers agents want to charge more for a P.I.T.A. short sale. That does make sense to me especially for a $110K home with split commissions.

[Captain Bill]

Originally Posted by Zippyman

I'd probably pay it, then sue for it's return in small claims court.

You might win, you might not, but the broker will have to appear & explain themselves, and that in itself should be worth $695...

There's also a commissioner's rule at the department of real-estate that states that a licensee isn't allowed to interfere with\jeopardize a closing due to a commission dispute with another licensee - since this agent is acting like a "double agent" (buy and seller agent), it seems they may be violating that rule if they're refusing to present your offer.

Complaints cost $0, no reason not to drop a dime on them.

In this case there is no contract yet, and it isn't a dispute between two agents regarding the commission, so it doesn't fit into that rule.

However, I spoke to a real estate attorney today who said that the fee is probably illegal. Since it "may" be illegal, it's doubtful if this is a brokers office policy.

Also, the agent must present all offers to the client unless the seller issues instructions in writing to not present certain type offers with certain terms, such as no offer below a certain price; no FHA offers, etc.

It does not make sense that a seller would issue written instructions
for an agent to not present an offer if the buyer doesn't agree to pay the agent an administrative fee. That would be counter productive for the seller.

I would agree that the thing to do is to sign the contract. After the contract is executed, then write a letter to the Broker stating that this fee may be illegal and request the Broker to drop the fee.

I wish to state that I am only presenting information, and the information I offer should NOT be taken as legal advice.

[ReadyFreddy]

Fact of life: Homes are going to be sold by agents, not just because they are in the multiple listing book especially in the current market conditions. The homes with full commissions are going to be pushed by the agent, not the short commission homes. Just getting a home listed in the MLS, does not get them sold.

How are homes being sold by listing agents? They have no way of contacting the home shoppers looking for that particular type of home. That's what the MLS is for. I've never heard of a home being sold any other way than the buyer runs searches on the MLS or occasionally sees a sign in the neighborhood. That latter way is a great reason to try FSBO first.

I used to get full-color postcards in the mail from our local high-end agent, advertising his listings, when the market was hot. What a waste of (his) money. I think they advertised himself, like an open house would for a realtor with less money and more time. The odds of a cold-mailing finding a buyer have got to be tiny. Gee, you live in this zip code, want to buy this $650k home by any chance? More likely people are like "650 for this???? Let's list our house! Call that guy! He got some nice photos!"

In our MLS, I thought a condition of listing was the seller has to offer certain commission levels to a buyer's agent? I don't know what a short commission is. I'm guessing these short sales where the listing agent won't show me the home themselves there is some sort of short commission, though.

[Kevin Beasley]

Originally Posted by Captain Bill

Can you provide a link to that article? I googled Peter G. Miller on Realty Times and this is all I could find. http://realtytimes.com/rtpages/petermiller.htm

I also found this article from HUD HUD lawyer looks at realty 'admin' fees
which indicates that the fees are not illegal.

I can't find anything in my AZ Real Estate Law book that states Administrative Fees are illegal.

In the Buyer Broker Agreement, there is a field for stating the amount (if any) that the Buyer will pay the Buyers Broker, in addition to what the Seller pays. That is usually used if the Buyers Broker requires a minimum fee, because some Sellers Agents may be offering to pay less than the minimum the Buyer Broker will work for. I know you don't have a Buyer Broker Agreement, but I mention that to show that a Buyers agent can charge a fee in addition to what the Seller will pay.

I'm a bit confused with the limited information provided. Above you state that she has you sign a Dual Agent form. In a subsequent post you state: "Oh no, no...she is the SELLER'S agent and is just writing up our offer. We have no agent".

The purchase contract has check boxes to show who the agent is representing. A box for representing the Buyer, another if representing the Seller, and another if representing both Buyer and Seller.

If she is not representing you at all, then the box for representing the Seller would be checked. Then you would have to sign an Unrepresented Buyer form.

If she is representing both Buyer and Seller, the box Both Buyer and Seller would be checked, plus both the Buyer and Seller must agree to "Dual Agency" representation, and both buyer and seller must sign the "Consent to Limited Dual Representation" form. That is a legal requirement. Without that the agent cannot act as a dual agent.

There are very few people on the forum who understand the real estate contracts well enough to provide you with advice, and there is insufficient information for those of us who do understand the contracts to offer advice. In fact there is conflicting information about the representation.

• Has the offer been submitted to the Seller?
• Is this a Short Sale? (It's typical in a short sale for the sellers agent to charge an Administrative fee to help pay for the short sale negotiator. That fee is usually disclosed in the Realtor Remarks of the mls listing sheet, or in a separate document under the Document tab of the mls listing sheet.
• What is the language she's adding that will give the seller an escape route?
• What does flightiness of the seller mean?

In my personal opinion, buyers and sellers should not agree to Dual Representation, because the agent now must become Neutral and not advocate for either party. There is a conflict of duties at this point.

However, in this instance it is unclear if you are an Unrepresented Buyer or in a Dual Agency situation.

My advice to you at this point would be to contact a Real Estate attorney to go over the contract with you because it's fairly obvious that you do not understand all that is happening with that contract.

We know Admin fee's are not illegal but definatly not the norm- and if not PROPERLY disclosed upfront definatly unethical... I see it mostly in lease listings, and find that they disclose the "Admin Fee's" in the private remarks of the MLS NOT the public remarks. So your prospect doesnt even know about them untill you tell them. I have also found that those that pull that crap are scandelous and unless my clients insists I never show their properties- If one party goes unrepresented (which sounds like the case) then they are subjected to all the greedy, ripoff's found in the real estate industry in today's world-

[makeitagreatday]

The office charging this $695 BAC to both Buyer and Seller in a traditional sale is Prudential Arizona Properties on East Camelback Rd. in Phoenix. The branch manager, who is also an associate broker with the firm, is the one who demanded this fee in order to present our offer.

[Kevin Beasley]

If the property is on the MLS and the fee is not disclosed you might be able to beat them out of it- if it's not on the MLS not much another realtor can do to help- If youd like to PM with the address perhaps I can help with more info.

[Captain Bill]

Originally Posted by makeitagreatday

The office charging this $695 BAC to both Buyer and Seller in a traditional sale is Prudential Arizona Properties on East Camelback Rd. in Phoenix. The branch manager, who is also an associate broker with the firm, is the one who demanded this fee in order to present our offer.

A listing agent is required to present ALL offers to the seller, unless the seller has provided the listing agent with written instructions to not present certain offers.

If I were a seller, I would not provide a listing agent with instructions to not present an offer to me unless the buyer agrees to pay the agent a $695 admin fee. That could damage me as the seller, so it doesn't make sense that I would provide those instructions.

Also, if I were the seller, I would not agree to pay the listing agent, or their company a $695 admin fee. I would also not agree to the listing if they were going to charge the buyer the fee. I would choose another agent or company.

[makeitagreatday]

You can bet that I have asked our perspective realtor for selling our home if she participates in this outrageous BAC. Needless to say, we will not hire an agent who does this, as it may not be illegal....but certainly unethical.

As the buyer, I cannot tell you what was agreed upon between seller and agent but I can tell you that the seller is fortunate that we do indeed like the property and it is unfortunate that the agent muddies an otherwise clean transaction and can understand if previous potential buyers walked when she demanded the $695 or she would NOT....not...present their offer to the seller.

We've contacted the ADRE.