Question about Commissions (negotiating, fee, accept, agreement)
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How much more work would it have been for them to handle a $500K transaction than a $100K transaction? None, zip, zero, nada. Both would have been happy to work on a $100K transaction for a $6K split, but they turned down $20K for a deal that was gift wrapped and put in their lap.
Greed makes people do stupid things...
Mike already addressed part of it. The other part is liability. It's not just about work or time but liability. More expensive = higher risk.
I would think an attorney would charge less per hour for a case in magistrate's court than the attorney in a murder case or a doctor charging less for a broken arm than open heart surgery. Use the analogy please, don't come back saying attorneys/ doctors have more education or whatever the same ole argument is (just saying it before it happens).
One correction, the initial offer was $510k with contingency and 6% commission. We countered back $510 no contingency and 4%. The buyers' agent felt insulted and convinced the buyers to pass. If we had been re-countered the $510k no contingency with 6%, yes, we would have accepted it. We would not have let the deal go for $10k and change, but we couldn't take a contingency sale for other reasons. Hope this helps clarify the situation. Thanks to all who voiced an opinion.
As for us, our own deal with a house fell through since we couldn't produce a contract with no contingency on our own house, so we're back to square one on both the purchase of another house and the sale of ours.
If someone came to my door wanting to buy my house, which I wanted to sell but had no contract with a Realtor, I'd work without a Realtor.
Or, if you really feel the need to have a Realtor involved, call the Realtor first, tell him you have a buyer ready, and ask if he'd like to handle it for 4%.
I must be missing something....
My son is talking about buying a larger home. He told me yesterday that he already has three people interested in buying his current home. He gave them the name of the Realtor who he would list it with. I said if he had buyers ready, why not just sell it to them and use the $15,000 commission towards his new home. "I just thought I'd toss (Realtor) a bone." What the heck?
I'm a former Realtor/broker, so I know there are advantages to listing your property, but there are also times when you should just do it on your own. His mother is also a mortgage lender, so she could help him with some of the details.
If someone came to my door wanting to buy my house, which I wanted to sell but had no contract with a Realtor, I'd work without a Realtor.
Or, if you really feel the need to have a Realtor involved, call the Realtor first, tell him you have a buyer ready, and ask if he'd like to handle it for 4%.
I must be missing something....
My son is talking about buying a larger home. He told me yesterday that he already has three people interested in buying his current home. He gave them the name of the Realtor who he would list it with. I said if he had buyers ready, why not just sell it to them and use the $15,000 commission towards his new home. "I just thought I'd toss (Realtor) a bone." What the heck?
I'm a former Realtor/broker, so I know there are advantages to listing your property, but there are also times when you should just do it on your own. His mother is also a mortgage lender, so she could help him with some of the details.
Thanks for the post. Yep, things would have been different if I could hitch a ride in the "wayback machine". Since that deal fell through two weeks ago, we had a nice young couple knock on our door a few nights ago asking if we'd be interested in selling our house. They said they had been trying to move into this area for years. We quoted a firm price, no contingents, no real estate broker fees, rock bottom. They put their house on the market FSBO with just a sign from Home Depot in their yard. In one week of drivebys, they have two offers. They are working on firming up a contract with the higher offer right now. We told them we would enter a contract with them on a contingency of closing not selling their house so it might happen this week or next so we'll see.
It's a business decision for the agent and he didn't want to work for 1% (because you still need to offer 3% to the buyer agent).
Really? You still need to offer this to the buyer's agent? The reason I'm asking is that a couple of years ago, I briefly had my home on the market. I asked my agent to accept 5% commission, and she reluctantly agreed. I found out later that she, unbeknownst to me, listed the commission as 3% for her and 2% for the buyer's agent. Probably one reason the house didn't sell immediately (besides the market), and there were very few shows. My house was practically new and in good condition. Other realtors I talked to later said she should at least have split the commission, and said buyer's agents will bypass a house with less than 3% or put it at the bottom of the shows.
Really? You still need to offer this to the buyer's agent? The reason I'm asking is that a couple of years ago, I briefly had my home on the market. I asked my agent to accept 5% commission, and she reluctantly agreed. I found out later that she, unbeknownst to me, listed the commission as 3% for her and 2% for the buyer's agent. Probably one reason the house didn't sell immediately (besides the market), and there were very few shows. My house was practically new and in good condition. Other realtors I talked to later said she should at least have split the commission, and said buyer's agents will bypass a house with less than 3% or put it at the bottom of the shows.
Well, I wouldn't "have" to offer 3% to the buyer agent but I'd be doing my seller a grave disservice if I didn't. While there is no standard or required commission 3 or 3.5 is normal and nobody gets excited to work for less than they have too. Or the buyer may have a contract with the Realtor for a minimum fee and if it's less than that the buyer may rule the house out. Any good agent of course would show the house anyway but I wouldn't expect another agent to take a hit for a listing agent being incompetent enough to justify a commission.
Really? You still need to offer this to the buyer's agent? The reason I'm asking is that a couple of years ago, I briefly had my home on the market. I asked my agent to accept 5% commission, and she reluctantly agreed. I found out later that she, unbeknownst to me, listed the commission as 3% for her and 2% for the buyer's agent. Probably one reason the house didn't sell immediately (besides the market), and there were very few shows. My house was practically new and in good condition. Other realtors I talked to later said she should at least have split the commission, and said buyer's agents will bypass a house with less than 3% or put it at the bottom of the shows.
Quote:
Originally Posted by Brandon Hoffman
Well, I wouldn't "have" to offer 3% to the buyer agent but I'd be doing my seller a grave disservice if I didn't. While there is no standard or required commission 3 or 3.5 is normal and nobody gets excited to work for less than they have too. Or the buyer may have a contract with the Realtor for a minimum fee and if it's less than that the buyer may rule the house out. Any good agent of course would show the house anyway but I wouldn't expect another agent to take a hit for a listing agent being incompetent enough to justify a commission.
Doesn't the listing agreement dictate the split as well as the total commission?
Ours does. I don't know how I could alter the deal, reducing the BA co-broke, and not be clearly liable for misconduct.
Doesn't the listing agreement dictate the split as well as the total commission?
Ours does. I don't know how I could alter the deal, reducing the BA co-broke, and not be clearly liable for misconduct.
Our ERTS only has total commission and doesn't have anything about the split, though it probably should.
Our ERTS only has total commission and doesn't have anything about the split, though it probably should.
That is interesting that it is not clarified.
I would think the split offered to the BA is material in the marketing scheme and likely should be documented and confirmed between Seller and Listing Agent.
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