Hi everyone.
I am an aspiring investor trying to soak in as much information as possible before I actually get started. I have been reading many books and many blogs (including this one which is GREAT!) and I had one question regarding assiging a contract while I have been working with an agent.
When using a realtor to help me search for properties that are within my potential buyers’ parameters, can my realtor get paid in any other way other than me spiffing him part of my fee once I assign the contract? How does that work? Correct me if I am wrong, but a realtor cannot make his normal commish unless he is the buyer’s agent.
Please advise and thanks in advance for all of the information!
It depends…is your realtor showing you “listed” properties? Some of this might depend on semantics or location. Where I am from both sides (list/sell) of the Realtor’s Commission are paid by the seller at closing. If “your” realtor is bringing you to look at houses and you put one under contract and then assign the contract, that same realtor is entitled to the commission he/she earned by being the procuring cause of the sale. If, in your area, the buyer’s agent is paid for by the purchaser, then you need to figure in that cost when you make your offers.
Chris
Thanks Newbie for the info.
In your experience, is it common for wholesalers to use agents/realtors to help them in finding properties for their buyers? And if so, are the buyers privy to paying the seller rep commision if need be?
Nick,
I’m assuming your realtor is only showing you listed properties, correct?
If that is the case, and you put a listed property under contract, assign the contract, and then it closes, then your agent will get a commission for selling the property, which will be paid by the seller.
No need to give them any of your assignment fee. Unless you want to.
Steph
If you’re making offers on properties that are listed in the MLS, the agent is already getting paid by the seller. You don’t need to split your assignment fee with the agent.
Great, thanks Steph and Raquel for the feedback.
Agents are in most cases paid by the seller on any listed property regardless of who the contract is assigned to. They are paid for selling the home, not for bringing any buyer in particular.
One thing that nobody mentioned that you must watch out for is if the person who you assign the contract to is under a buyers agreement with another agent then that agent could go after the other agent for a commission, more than likely that won’t happen but it is just something to be aware of.
That’s a good point, thanks for the feedback, Eric