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Are You a “Cooperating” Broker?

By
Real Estate Agent with Westcott Group Real Estate Company

 "Cooperating broker" is a term that is usually refers to the splitting of commissions in a real estate transaction.  For some agents and brokers, the buck stops there (pardon the pun), and this mistake can ultimately end up costing you money. 

 

A recent post entitled The Irony of the "Courtesy" Key!, highlighted the fact that there are a number of agents that have decided against using electronic lockboxes to make their showings more convenient to other agents.  In the comments of that post, a number of you pointed out that this tactic may be based more on greed than laziness.  It wasn't something that I thought about when writing the post, but in retrospect, it may very well be one of the reasons that agents choose to make the home more difficult to show.

 

Things have started to pick up quite a bit, which is why I haven't been around Active Rain much in the past week or so.  When things get busy, there will ultimately be some scheduling issues during the weekend because that is when most buyers are available to look at homes.  There are some buyers that are willing to go to open houses on their own when I can't accompany them.  Although I prefer to be there for all appointments, I can only be in one place at a time, and I don't want to discourage buyers from spending the day viewing homes.

 

Things may be different around the country, but on Long Island, it is a fairly common practice to "cooperate" with other agents by allowing their buyers to come to open houses on their own as long as arrangements were made beforehand.  I've done open houses where people told me that they were already working with an agent, and I respected their relationship, even if I wasn't notified beforehand.

 

This past weekend, I had appointments scheduled already, but one of my buyers wanted to check out some open houses on their own.  I told them that I'd call ahead and notify the other agents.  The first agent was extremely friendly, and was more than willing to have my buyers attend the open house without me.  In fact, this agent wasn't even going to be at the open house, but passed along the information to the agent that was doing the open house for her.  The second agent was happy to have the buyers come, as she was selling her own home.

 

 As we all know, open houses are a kind of hit or miss proposition.  Anytime that you can guarantee having people attend the open house, you would be foolish to do anything to prevent buyers from attending.  It's bad enough when agents take this stance and turn away a potential buyer, which is not in the best interest of the homeowner that they represent, but when they refuse to allow you to send a buyer to the home that they are selling, it becomes even more mind-boggling.  Here is the story...

 

This agent's home has been on the market since January, and she has already started dropping the price.  It is very likely that previous open houses didn't generate much traffic.  The agent wasn't even the one hosting the open house this past weekend.  Her husband was going to be at the house while she was out on other appointments.  When I spoke to her and asked if I could send buyers to the open house because I had a scheduling conflict, the response was "I'd rather you didn't.  Why should I pay a commission if that person ends up buying the house and my husband was the one that showed them the house?"  Needless to say, I was shocked at this response.  It's one thing to be greedy and try and get both sides of the transaction when you are representing a homeowner, but turning away a potential buyer for your own home seems to be totally illogical. 

 

The lack of cooperation that this agent showed this weekend will have an impact beyond this one event.  Now that I've seen this agent's true colors, why would I bother showing any of her other listings?  Of course, I would do so if the home was a perfect fit, or if the buyer requests it, but with the amount of inventory on the market, it is fairly easy to avoid showing the listings of difficult or unprofessional agents.

 

We, as agents and brokers, face enough of a challenge overcoming the daily doom and gloom of the media.  Our best chance to close deals in this market is to "cooperate" with other agents and brokers.

 

 

 
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel
In our area most agents  cooperate with agents if their buyer shows up at an open house. But it is different with new construction. I wish they would follow the same rules.
Apr 09, 2008 11:04 PM
Vanessa Stalets
RE/MAX Elite - Brentwood, TN
REALTOR, Brentwood TN Homes, Real Estate
Oh Adam, I am appalled at this agent! What a bad way to go! I would never even think of responding like that. I have had many buyers show up at my open houses without their agent or being notified, as a matter of fact I have NEVER had an agent notify me like you did her. All I can do shake my head at this, talk about cutting off ones own nose to spite the face. Grr.
Apr 10, 2008 02:54 AM
Daniel Seider
BTRE Big Trees Real Estate - Arnold, CA
I beleive in order to get the seller the most money for their home you haave to give all agents access
Apr 10, 2008 03:11 AM
Sandra Paulow
Aspen Properties, Inc. - Pinetop Lakeside, AZ
REALTOR, Associate Broker, GRI, SFR
Adam,  There are a lot of agents out there who are just greedy.  But, to discourage a potential buyer from looking at a home just for the sake of a double commission is pretty sad.  Even if it is their own home, if you showed up with your buyer and wrote an offer they would have to cooperate with you.  Keep in mind though that cooperation and compensation are two very different things.  Compensation is not owed unless the property is listed in the MLS and states a percentage amount and in our area, we do not have to compensate unless the other agent is a member of our Association.  We usually do because we feel it is to our sellers advantage to sell the house and you are certainly going to get more cooperation from the other agent if you do compensate.  I was just curious, is it possible that these sellers have an exclusive on that property?  Just a thought. 
Apr 10, 2008 11:34 AM
Ross Quintana
Real E Smarter - Spokane, WA
Real E Smarter Real Estate Coach - 509-362-1966
I would notify them by talking to their broker that the person wasn't willing to let my buyer who wanted to see the property and that you would like to know if the seller knows this agent is not allowing potential buyers see their home.  That should get things moving.
Apr 10, 2008 11:50 AM
Ross Quintana
Real E Smarter - Spokane, WA
Real E Smarter Real Estate Coach - 509-362-1966
I would notify them by talking to their broker that the person wasn't willing to let my buyer who wanted to see the property and that you would like to know if the seller knows this agent is not allowing potential buyers see their home.  That should get things moving.
Apr 10, 2008 11:50 AM
Karen Luke
South Metro Property Management, LLC - McDonough, GA
Henry County Real Estate

As listing agents our biggest prospects aren't buyers themselves, but buyer's agents. They are most likely going to be the agent causing the listing to sell.

I'm with you Adam, I'd just skim past her listings. She's unethical.

Apr 10, 2008 02:38 PM
Chris Ann Cleland
Long and Foster Real Estate - Gainesville, VA
Associate Broker, Bristow, VA
Cooperation is definitely something that is great when you come by it.  However, it is shocking how often you don't.  I live by the golden rule.   On the other hand, don't take advantage of my kindness.  As a listing agent last December I was called into action by the buyers (under contract with us at the time) on the 23rd.   When they called me they said, "Our agent is busy and we really wanted to see the house again.  She said you would let us in."  That was going a little too far.
Apr 10, 2008 02:42 PM
Christopher Myers
Orlando Property Group - Orlando, FL
Greater Orlando and Central Florida Real Estate
Astonishing!  It makes you wish we could temporarily suspend that little thing called the Code of Ethics...just long enough to tell their seller exactly why their home isn't selling.  Some people just don't get it!
Apr 10, 2008 02:51 PM
Tracy McNeil
Crye-Leike - Olive Branch, MS
Vice President, Broker - CRS, ABR
Seems to me that there is this little thing called "Fiduciary Responsibility" which includes a little thing about "putting our clients interests above all others, including our own" . . . so an agent who would not let a prospective buyer come to the house without their agent sure isn't fulfilling those obligations are they?  I would be curious to know how her sellers would feel about her attitude.  Hmmmmm.
Apr 10, 2008 03:17 PM
Kelly Sibilsky
Licensed Through Referral Connection, LTD. - Lake Zurich, IL
In my area, an agent CANNOT represent a buyer when he/she is selling his/her own home, so if that is the case for your area as well, then wouldn't she want the comfort of knowing that the buyer is a pre-approved, ready, willing and able buyer who is being represented by a professional real estate agent so that she would know the transaction would go smoothly...? Sounds like she is using the MLS to promote her home but has no intention of "cooperating" with anyone.
Apr 11, 2008 12:45 AM
Tony Fantis
Fantis Group Real Estate - Salt Lake City, UT
Realtor,Principal Broker - Salt Lake City
It would seem to me that if you have an agency agreement with your buyers, there shouldn't be any issue.  The other broker my not be friendly, but that would just reflect poorly on her, right?
Apr 11, 2008 03:09 AM
Jeffrey DiMuria 321.223.6253 Waves Realty
Waves Realty - Melbourne, FL
Florida Space Coast Homes
Very nice post. All I can say is it should be illegal for an agent to attempt to "rep" both sides of a deal.
Apr 11, 2008 07:37 AM
Latonia Parks
Top Bragg Realty, Fayetteville NC, Home of the 82d ABN DIV - Fayetteville, NC
Certified Military Relocation Expert
The world is full of colorful people who sometimes don't act in anyone's best interest.
Apr 11, 2008 08:53 AM
Lorraine or Loretta Kratz
Crescent Moon Realty, Inc. & Land N Sea Auctions. - San Marcos, CA
Certified Negotiation Consultants

Adam:

Real Estate makes for strange bedfellows. Don't waste time on being petty. Find that client a home.

Apr 11, 2008 12:58 PM
Melissa Grant
A Serendipity World - Greenbackville, VA
The Law of Attraction In Life & Business
Great post Adam ! Dual Agency is permitted in the state of TN, however to date I think I am the only one I know that doesn't believe in it or practice it. I would hate to be the one on the stand when a Judge ask's who did you represent ? Who's best interest did you have at heart ? Kinda hard to convince a Judge you did your best for both !
Apr 13, 2008 11:04 PM
Shannon Lefevre
John R. Wood Properties - Naples, FL
Shannon Lefevre, PA Your Naples Smart Girl
ADAM:  I've missed you and your smart and funny posts....."I'd rather you didn't"  that cracks me up.  Tell me the truth...when she said that did you take the phone away from your ear and look at the receiver like a dog looks at his tail when he passes gas?
Apr 14, 2008 10:27 AM
Katerina Gasset
The Gasset Group & Get It Done For Me Virtual Services - Provo, UT
Amplify Your Real Estate & Life Dreams!

Adam- Congratulations on your featured post. If you are representing the seller you are supposed to act in their best interest.

We are absolutely swamped in a good way! We are busy.

But we are free on weekends because we are listing agents. We just ran out of time to work with buyers so we just hired a buyers agent. Being a listing agent gives us much more control of our income and lives. And we love to co broke! We love getting emails and faxes of offers on our listings from buyers agents! Just love it!  

Apr 16, 2008 05:55 PM
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Adam..... I agree with many of the comments mentioned.  Dual agency is abused by many.....  you bring up some good points and it shows that you care about your clients... good job here...

jeff belonger
Apr 19, 2008 02:27 AM
Lindsay Pendleton
Relocating To Baton Rouge & Surrounding Areas - Baton Rouge, LA
Marketing Agent - Property Management in Baton Rou
Wow, great post Adam. I always enjoy reading your stuff. Well, we all know how this is going to end up. Usually greedy people end up with nothing. She will do all that she can to get both sides of the commission that she will probably lose out on both sides and not sell her house at all. C'est La Vie. Can't say I would actually feel bad if it didn't sell.
Apr 19, 2008 02:36 AM