Is this GREED, or am I way off-base on this one???

If you offered in the MLS both the 1/2 months rent for a 12 month lease and a 3% for a closed sale and I'm assuming that the actual full lease is for 12 months and that would trigger the 1/2 rent compensation.  If the buyers are fortunate enough to be able to close before the end of the rental agreement period, such as 6 months in, I would be thrilled to have a confirmed closing and as per the agreement in the MLS now give the closing commission. 

We have seen rent w/ options where after the full year has passed, even if the renters now wanted to buy, the value of the property has dropped considerably below the original offer from the prior year, that potential buyer will be walking away or renegotiating the sales price rather than taking the option.  I'd just be happy if they could close in 6 months and be glad they didn't wait the full 12 months, even if it makes you feel the buyer's agent is profiting beyond your intentions. 

If you didn't write into the commission comments that the rental portion would be pro-rated back from the closing commission for each month less than the full 12, I think you need to stand by what was presented in the MLS.  Its just expecting what the MLS offered, not greed. 

If in the other hand, this wasn't what you offered in your MLS listing, but what the buyer's agent would ask for if they were in charge of the commission struture, tough luck to them, its whats in the MLS that counts not what their Broker wants.  I'm not thrilled when I show a property that is offering 1.5% less than what most others are giving, but if I write an offer, I don't email the other agent and ask for more just because I don't like the pay scale. :)

I haven't read all of the comments so this may be a repeat but in this area the tenant pays a 1 month (lease amount) equivelant for a lease, NOT the seller!

So maybe you can suggest the same in this case. The owner will pay the negotiated commission at the closing when it closes.

Good Luck with that!

Tere

Sorry for the double comment. I was'nt logged in on the first one and I want my points cuz I'm GREEDY! 

Hi Derek,   I was in a similar position, but I did not have my listing advertised in the mls as a rental, just the sale. I only charged the commission on the sale, not the what turned out to be a year long rental.  I too had a problem w/ charging the seller twice and the buyers agent never even brought up the rental commission so I guess she felt the same way. However, since you have it advertised both ways I would think that if the other agent wants both of the commissions than you would have to oblige?

I like Missy's idea of getting paid for the lease upfront and then deducting it off of her commission. That way you get something now and in case it does'nt sell you did'nt do all of that work for nothing. Wish I would have thought of that! 

Well, I would guess...that you should be paying commission for the Lease...if that is what is being accomplished now.  I do not know If I would call it greed in the long hall..if the Tenant does actually purchase the home....the seller will be selling and the buyer will be buying.  If you think about it, the buyer was brought to you by the agent and if this was just a lease without an option to purchase you and your seller would be back to the drawing board in the future.

In reference to you doing all the work.  This is really your decision....you could force the buyer's agent to do their job...but, I understand from experience that things would be delayed and nothing would get done...been there done that.

So, even though, I would have never thought of getting paid twice on this deal before I read your blog...it does seem fair to me...cuz, the seller is getting two benefits for the price of one!  Don't you agree?

Thank you for your Blog!

What's confusing?  The agent procured a renter and a buyer.  Just prorate the twelve to six.  No reason the buyer/leasing agent should be out because you think they are getting paid too much.  The compensation in the MLS was pretty clear.

It's not greed, it's what is stated. 

Hey Derek,

Do you have a good lawyer? I would have fired you as my Realtor! 

Teasing you Derek...  

What's stated in your listing agreement with the seller?

John Lopez

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 REALTOR,

Do you have a client that wants to buy a house on the Westside of Ann Arbor, but doesn't have good credit? I have a property on #### Stayaway that might interest your client to be in a RENT TO OWN program.

See attachment for a printable flyer or email it to your client.

Compensation for the REALTOR: One month rent and at the end of the program receive 3% of the purchase price.

The client can have his/her own Loan Officer to work with through this process or we have recommendations of Loan Officers to interview.

Why should your client rent when he/she can own a home? Your client will have a portion of the rent to be use as down payment while trying to build his/her credit. Credit Repair is available as well.

If you have an applicant contact me at ###-###-#### or email me at realestatemichigan@yahoo.com.

I look forward in working with you!

John Lopez

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To me it seems reasonable to get both commissions.  Especially since it sounds like everyone knows upfront that they will lease and then buy.  What is to prevent all home sellers from doing this and avoid paying real estate comissions.  I don't feel its greedy as you are taking care of all the issues and responsibities associated with both of these transactions.