Posted on 02/19/2010 7:43:46 AM PST by TSgt
My wife and I have been looking for land for several years. We are very independent buyers and never established a formal relationship with a realtor since we didn't want to waste their time and didn't want to be hassled. We did keep in contact with a local realtor we had in mind to represent us should we decide to make an offer.
Recently we found a property we liked and walked it with the seller's realtor. We decided to make an offer and then entered into a formal, legal, relationship, i.e. retained, with our local realtor. We made an offer and the seller accepted however the seller's realtor refuses to split the commission with our realtor. He feels that he is owed the entire commission because he walked the property with us even though he would have had to anyway. At the time we walked the land we informed him that we had not formally retained a realtor, which was true, however we had no intention of being represented by the seller's realtor for obvious reasons.
Our realtor is telling us not to worry about it and that she will simply not be paid for this transaction. My wife and I do not find this acceptable and believe that she should be paid for her work. Should we push the issue about splitting the commission or pay her half out of pocket? I would rather not spend another several thousand dollars but I believe people should be paid for the work they do and she has done a great job.
She works for a major national realtor. Is it unethical to pay her directly and how much would she be paid after her company takes their share?
I’m sweating it because I feel terrible about her not getting paid for the work she has done.
If she would just tell me that she’ll pursue it via arbitration then I’d forget about it.
I was responding to someone earlier who said something similar to you. In fact I did all the work putting the offer together, drafting letters my friend signed, as her “assistant”, so I basically DID the work of the buyer’s broker. I also pushed everything through after we were “in contract”, because there’s still LOTS of work to do after that.
Also, my friend’s NAME was important in closing the deal. The seller’s broker did not know me, or my friend, from a hole in the ground. But he did know my loan broker very well. He called him up and said “who are these people?” The loan broker said, about my friend, “Those people close deals — they do not screw around.”
The seller’s broker told me that that is why my offer was accepted — otherwise they were going to take a slightly lower offer, because they trusted it more. It was the loan broker vouching for my friend that did it.
I appreciate your loyalty and knowing what’s right, but naah, don’t worry about it any longer. Disputes in commission-based business happens, and yes, it probably took your agent by surprise at first.
Be assured that this dispute WILL be resolved, and knowing the type of fine and classy individual your agent appears to be, she doesn’t want you to feel uncomfortable. Instead, she’d prefer that you revel in what should be a joyous occasion for you. Follow her lead.
If YOUR Realtor (buyer) wrote the offer and acceptance and “negotiated” it on your behalf, he/she is entitled to a percentage of the commission (whatever is reasonable and customary for your area). Commissions for land deals out West typically go for 10% but are negotiable.
Present refers to the contract not to the property.
The general rule for Realtors is that if you perform the duties of a Realtor in the purchasing of a property you get paid full commission. The negotiation and writing of the contract, the presentation, and the management of the close are the duties of a Realtor.
The showing of a property to a prospective buyer is way down on the list of duties for a Realtor and it is very common for a seller’s agent to show property and then split the commission with a buyer’s agent. The reason it has become more common is that the current younger generation is less willing to sign a representation document than previous generations. It provides protection for the buyer.
I have seen other situations like this and it seems to have become more common with the downturn in the markets, but it needs to stop as it can hurt an agency if they get the reputation for stiffing purchasing agents.
This problem should be handled on a broker to broker basis and should be resolved quickly as it is not something a broker wants to be known for.
Ask to meet with your agent’s broker and agent and let them has it out. Generally it can be speedily resolved. That is what brokers are for.
Good luck.
I am a Realtor, not a lawyer, BTW.
You got it. I back channeled him. I think it is his broker’s fight.
Something to consider is that frequently the listing is by the broker not the realtor.
Commissions are sometimes split by the brokers THEN again between the broker and realtor, meaning that instead of the 6-7%, the realtor may only get 1.5% or so if there are splits.
You can do the math and see that she may not want hassles and hard feelings over a thousand dollars or so.
IIRC in Texas, the most common real estate lawsuits are those in which the the listing agent represents both parties. It is really difficult to determine whether the buyer got the best deal. Many agents will refuse to do both sides of the deal for this reason.
In other states, the most common situations are deals in which the buyer is represented by a lawyer. Which I think a bit odd.
If you are a buyer, sign a rep agreement as it protects you from bad agents. If you don’t like the rep, the broker will assign another or take the account himself.
The rep agreement is the document that obligates the broker to represent you and only you in the transaction.
The showing has little to do with it. If Kentucky or Ohio is anything like Texas, any oral representation made by you to the seller’s agent is void. In other words, it doesn’t exist.
It really depends on the laws/rules in your state/MLS as far as who gets the commission. I am not saying the laws are ethnical.
I was a realtor for many years and just recently retired for just this type of issue. An our local realtor board is a joke, they review the problems and award the commissions on the buddy system. That’s life.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.