Realtors and Commissions (for sale, loan, how much)

[Spring Hillian]

And Firestone will try to sell you tires and windshield wipers when you go in for an oil change. People just need to use their heads.

Ive dealt with two realtors in my life, neither of them were pushing anything. We told them what we wanted, our ceiling price and the areas we wanted to look at. They did the research and showed us exactly what we were looking for, from the lower end of our scale to the upper end and everything in between.

Originally Posted by crazynip

They dont make bad loans, but they push people to houses they cannot afford spreading lies like "real estate is the only investment that never depreciates", "this home will be worth twice this in 5 years"

Sound familiar?

The banks certainly did their share too

[bentlebee]

Originally Posted by zclipse

Innertuber, I am sure may of us have had 'great service' from Realtor(s). But, isnt that what every "professional" is expected to do? Offer great service?

I am not talking about ass hats who default on their loans... just talking about the 'cost' of hiring a Realtor to sell your house...

Somehow they all have cobbled together making it very expensive to sell a house...

IF the market was as awesome as 2006, I would have not cared... but now, given the economy, it is not fair on part of Realtors to still insist on huge commissions for the kind of effort they put in.

Sorry to disagree with you. IMO in 2004-2005-2006, the Realtors should have gotten way less than now.

Short sales are sometimes very hard to close on and many times they end up going into foreclosure specially when the seller ends up thinking they are "smarter" to walk away than to sign a judgment....

Not every one will be awarded with a foreclosure and on top of that with bankruptcy....many will be stuck with bad credit and no bankruptcy and having to live with that instead of knowing what they owe, less bad credit and move on with their life.

Realtors won't get as much as you might think in a short sale deal since many times they have to cut their commission so the lender will agree on the numbers. If you calculate the hours they have worked on the deal than you realize it isn't a high paid job, unless you have an easy short sale deal...but not many are easy.

In the high housing market any one could sell a home....even a toddler could sell it with a big smile...now it is a buyers market, not a sellers market.

I do agree there are still too many BAD REALTORS in todays business...I guess because they can't get a job else where or they like to be a realtor, but their services are very bad....I see them almost every day and it is very sad! But I guess that counts for almost every profession, the good the bad and the ugly...hopefully it will change!

[bentlebee]

Originally Posted by zclipse

Thanks TamRE. That sums up the crookedness of the Realtor 'profession'.
There is no way I am paying 5% commission, especially on houses that sell for 500K+.
It is in the best interest of the nation to dissolve the National Association of Realtors and breakup the monopoly of the MLS..

5% is too much for you on a short sale? Sorry but it means that the selling party gets 2.5% and the buyers party gets 2.5 %....that isn't that much if you see what kind of work has to be done.

If you hire a Realtor that doesn't do zip, than i agree it is way too high, but if you have a Realtor who makes a Virtual Tour, has multiple websites, advertise in local papers, makes flyers, puts a sign in, etc...Do you think that all will happen for free?

For a couch potato even 1 % is too much...I agree on that.

[zclipse]

Originally Posted by bentlebee

Sorry to disagree with you. IMO in 2004-2005-2006, the Realtors should have gotten way less than now.

Short sales are sometimes very hard to close on and many times they end up going into foreclosure specially when the seller ends up thinking they are "smarter" to walk away than to sign a judgment....

Not every one will be awarded with a foreclosure and on top of that with bankruptcy....many will be stuck with bad credit and no bankruptcy and having to live with that instead of knowing what they owe, less bad credit and move on with their life.

Realtors won't get as much as you might think in a short sale deal since many times they have to cut their commission so the lender will agree on the numbers. If you calculate the hours they have worked on the deal than you realize it isn't a high paid job, unless you have an easy short sale deal...but not many are easy.

In the high housing market any one could sell a home....even a toddler could sell it with a big smile...now it is a buyers market, not a sellers market.

I do agree there are still too many BAD REALTORS in todays business...I guess because they can't get a job else where or they like to be a realtor, but their services are very bad....I see them almost every day and it is very sad! But I guess that counts for almost every profession, the good the bad and the ugly...hopefully it will change!

Sure, that may be the case for 'short sale' or a 'foreclosure'.. but guys like me want to sell the house and REPAY the loan in full.. not negotiate with lender, or run away.
For us, especially ones who are selling at a loss.. especially with sale prices that are high, it is a huge disappointment to see Realtors DEMANDING 5 to 6%.

Following your logic, straightforward selling services are not much work for a Realtor (if it is not short sale, or foreclosure). So, they should be willing to work for less commissions on large prices houses (e.g. sale prices > 500K).

IMHO they are (collectively) greedy.

[zclipse]

Originally Posted by bentlebee

5% is too much for you on a short sale? Sorry but it means that the selling party gets 2.5% and the buyers party gets 2.5 %....that isn't that much if you see what kind of work has to be done.

If you hire a Realtor that doesn't do zip, than i agree it is way too high, but if you have a Realtor who makes a Virtual Tour, has multiple websites, advertise in local papers, makes flyers, puts a sign in, etc...Do you think that all will happen for free?

For a couch potato even 1 % is too much...I agree on that.

OK.. 5% of WHAT is the question.. for a 100K house, 5% is worth for the amount of work done (e.g Virtual Tour, pictures, flyers, sign, etc)...

for a MILLION dollar house, 5% of a million is WAAAY too much money to pay a Realtor for that kind of work..

That is my point..

[TerdFerguson]

Originally Posted by zclipse

OK.. 5% of WHAT is the question.. for a 100K house, 5% is worth for the amount of work done (e.g Virtual Tour, pictures, flyers, sign, etc)...

for a MILLION dollar house, 5% of a million is WAAAY too much money to pay a Realtor for that kind of work..

That is my point..

Exactly. I'm a realtor and I think they get paid way too much for what they do in many instances, especially when the sales price of the house starts getting way up there as you pointed out.

To the original poster, you can always get your house listed in the mls for a flat fee (as low as a couple hundred bucks). Just look around on the internet to find some flat fee listing services. You would still have to pay the buyer's realtor but you would be saving a full 3%.

You still need help with the sale from a professional though, right (review the contract, inspections, closing, etc.)? I'm gonna let you in on a great secret. You can get an attorney to represent you for no extra cost. They'll make their money off the title insurance premium which you, as a seller are going to pay either way. Make sure you get an AV rated attorney.

So with my way, you're in the mls, you have an attorney representing you, and you're paying 3% instead of 6%.

[zclipse]

Originally Posted by TerdFerguson

Exactly. I'm a realtor and I think they get paid way too much for what they do in many instances, especially when the sales price of the house starts getting way up there as you pointed out.

To the original poster, you can always get your house listed in the mls for a flat fee (as low as a couple hundred bucks). Just look around on the internet to find some flat fee listing services. You would still have to pay the buyer's realtor but you would be saving a full 3%.

You still need help with the sale though from a professional right (review the contract, inspections, closing, etc.)? I'm gonna let you in on a great secret. You can get an attorney to represent you for no extra cost. They'll make their money off the title insurance premium which you, as a seller are going to pay either way.

So with my way, you're in the mls, you have an attorney representing you, and you're paying 3% instead of 6%.

THANK YOU! That is exactly what I was looking for... I will consider your suggestion seriously and look at getting into the MLS (I think FSBO does it).
Then get a Real Estate Attorney to do my paperwork, even if it costs me more. I dont mind paying someone REASONABLY for the amount of effort/work put in.

[bentlebee]

Originally Posted by zclipse

OK.. 5% of WHAT is the question.. for a 100K house, 5% is worth for the amount of work done (e.g Virtual Tour, pictures, flyers, sign, etc)...

for a MILLION dollar house, 5% of a million is WAAAY too much money to pay a Realtor for that kind of work..

That is my point..

It depends on what the realtor is doing. Is a realtor is ordering elevated pictures, staging a home, making high end brochures, having brokers open/open houses with food, etc....then the cost are higher than if an agent is just putting the listing up and sitting and waiting...I agree in the last example the agent is over paid, but I don't call that one an agent but a donut eater.

[TampaKaren]

Broker fees are not fixed... it's against the law and everything is negotiable. Just make sure you know what you're getting for your money.

[bentlebee]

Originally Posted by zclipse

THANK YOU! That is exactly what I was looking for... I will consider your suggestion seriously and look at getting into the MLS (I think FSBO does it).
Then get a Real Estate Attorney to do my paperwork, even if it costs me more. I dont mind paying someone REASONABLY for the amount of effort/work put in.

Most FSBO and discount brokerages are out of business who were doing very well in 2005.

I had a discount realtor and had to do almost all the work myself so even the 4% was over paid. If it wasn't for my creativity and due diligence I would have been stuck with some of my homes. It was ridiculous and one of the reasons why I stepped into the business. But everything happens for a reason

In Europe we sold homes and paid at the most 1.5%, our last home we paid 1.25% but the system is different over there and a Realtor has less work to do since 95% of all contracts will close after a mortgage is approved otherwise the buyer will loose 75% of the sales price!

The other side is that the risks are lower soare the gains. We were not allowed to sell our new build home for 3 years (government rules) and not allowed to enter more than 1 time in 10 years to be on a list to have a chance to buy a new build home.

I suggest to all people who are shabby to try FSBO...and if you succeed, great job! Otherwise you need a Realtor who has the resources to get you a solid buyer....you don't want to get robbed in your home, or end up with a bad contract....Remember just as there are bad Realtors, there are very bad Lawyers too!

Bad mortgage brokers, bad home inspectors, etc....Realtors often have a list of trust worthy professionals and are not going to give you everything for free.

Somethings are different from the outside...I was one of the people bashing Realtors on this forum and still do...sometimes...but I have witnessed very good hard working Realtors who can make deals happen that not everybody can do.

I have no clue what the OP's profession is but perhaps some one is worse in doing the same job and others are better, that counts for everything in life.