If you already know my story then you know I was putting my offfer in today with my agent BUT… She only got 2.5% from the seller agent and she tried to tell me that her fee was 3% but I know I should not have to pay the remaining .5%. She said she would find a way to get the .5% so that it doesn’t come out of my pocket, I think she meant a way so that it gets financed into my loan. I told her I shouldn’t pay or get another agent and then she said ashe will lower but that was after I signed and faxed it to her… AM I SCREWED??
2 ways to look at it.
if she got you a good deal, pay up the .5%.
however if she’s just average and just shows you whatever is on mls without offering any input
then tell her you’re going to pull out if she keeps on pushing the 0.5% issue.
Thank You!
The seller listing the property negotiates the sales commission % with their listing agent (if there is one). It’s then up to the listing agent to share with the buyer’s agent. It’s not your responsibility to get her the additional .5%. If she’s not happy with 2.5% then that’s an issue she takes up with the listing agent.
DFW Holdings, you are entirely wrong. The listing agent can offer up any amount they want. The buyer’s agent often referred to as the “selling agent” is then entitled to what ever the listing agent offers up, and no more from the seller or listing agent. This is a rule set by the MLS Board. However, many agents, myself included always require a buyer’s rep agreement, specifying how much I will be compensated by my buyer. If the buyer agrees to 3% but the listing agent/ and seller are offering an amount less than that my fee must be made up by my client. Many times i have had buyers that stress to me that my compensation must be from the listing agent contribution, i then verify with the buyer that they do not want to see properties that do not cover my fee, much like other amenities if it does not meet my clients wishes and requirements I would not even show them something lacking their needs.
Wendy I don’t have it entirely wrong. I have it exactly as you said it. If there is not official agreement between buyer and buyer’s agent then if the agent is not compensated as much as they thought it’s their problem. Just as if the agent is expecting 4% instead of 3% and they only get 3% from the seller’s agent then they can’t expect the buyer to make up the difference if they haven’t agreed to this previously.
One caveat, you’re assuming the buyer is going to pay the difference from the listing agent portion and your 3% which if they signed an agreement to do so, then they should. The original statement from blue mentioned nothing about an agreement with their agent to make up any difference from what the listing agent is giving and what they are expecting in compensation. As you stated if the listing agent isn’t compensating you enough you won’t show the properties if your client doesn’t want to make up the difference. Since this was obviously not discussed with blue prior to making an offer, then it’s not blue’s concern. It’s the agent’s lack of preparation that is causing this. Obviously you take the time on the front end to clear up these issues with your buyer, wouldn’t you expect that blue’s agent would have done the same?
DFW Holdings,
you are right in preparation is the key. Many agents believe the seller or seller’s agent must make up the difference when in fact the MLS rules disallow even asking for this. That is my point more than any. I certainly have had casual buyers that did not like my business plan, I can respect that and move on, but those that are my clients always agree on my compensation before we even visit a single property.
Wendy,
I wouldn’t hesitate to pay the difference on my own if it came up PRIOR to any offers. I’m not saying that people don’t or even haven’t made up the difference. I just think that any business that makes up the rules after the fact (as blue’s agent appears to be doing) can’t fully expect their clients to agree. In fact, their client isn’t obligated to agree at all. I think you and I see eye to eye on this for the most part based on what you’re writing.
In this case, the owner could be offering 5% and the agent is splitting that. If the owner disagreed with the split, they did not have to sign the listing agreement. I often think those lower commissions are a greedy owner who is going to be difficult.
Either way, I tell clients up front that my fee is x%. If someone offers lower (it could be the owner or the listing agent), I tell the buyer that we’d need to agree to price the rest of my fee into the sale. Usually, the seller will cover the fees, but if they’re offering less, the transaction will need to. On the other hand, if the owner is offering a higher commission, I split that with the buyer.
If you think the agent is worth their 3%, then it should come out of the transaction costs just like you’d pay on any other house. I’ve never had an issue with this, but wouldn’t mind taking less if my buyer really wanted a property.
You can always just write in a commission of 3% for the buyer’s agent as part of negotiations.