You Be The Judge: Should This Real Estate Agent Be Paid?

Real Estate Broker/Owner with Fisher & Company, P.A., Marketing & Creative Strategists


You Be the Judge: Should This Real Estate Agent Be Paid? 


The Case Before the Court:

A “For Sale By Owner” seller spent time and money advertising his property, holding 

American Flag and Judicial Gavel

open houses, and doing everything he could think of to attract a buyer to his property.   Several area real estate agents stopped by and asked him if he would co-op. Knowing that the customary co-op rate in the area was 3%, the seller replied that he would pay the Realtors 3% if they brought him a buyer. 

Realizing that he could increase his chances of selling his home faster with some professional help, he put that he would co-op with real estate agents on his flyers and in his ads at 3%. 

Eventually, at an open house, the seller shows the home to someone driving by and ends up selling the home all by himself.  Several days later, a real estate agent shows up at his door and demands the 3% commission since he had been working with that prospect for some time. 

Now then, the question before the court:

Should the For Sale By Owner seller pay the real estate agent?




Comments (13)

Andrew Mooers | 207.532.6573
Northern Maine Real Estate-Aroostook County Broker

"Working with the prospect"...does that signed buyer agency agreement with this stellar broker? You said the FSBO put that he would co-op, participate with local agents on his marketing propaganda. Did he sign anything with the madder than a wet hen stellar broker that's crank factor is boiling hot, blowing steam? Or just a blanket statement that seller agrees to participate for 3% with a licensed real estate broker? Devil in the details.

Feb 03, 2010 08:20 AM
Elizabeth Wange
Coldwell Banker Danforth - Kirkland, WA

Why would the seller pay the real estate agent?  If the agent did not bring the buyer, he does not rate a commission......unless the buyer had signed a buyer agency agreement with the agent! Then the buyer owes the agent a commission, not the seller. If the buyer signed a buyer's agency agreement, then the buyer should have let the agent negoiate the deal to include the commission. Sounds a bit unprofessional to me.

Feb 03, 2010 08:24 AM
Deborah Fisher
Fisher & Company, P.A., Marketing & Creative Strategists - Fort Worth, TX

Oh, Andrew, Andrew, Andrew . . . I forgot how much I missed blogging over here on active rain! lol

The seller was holding an open house and out of the blue this guy walks in to look at the house.  The seller had never seen the buyer before and vice versa. The seller had no signed agreements with anyone other than the divorce papers between he and his wife. It was a blanket statement that he, the seller, would co-op if a Realtor brought him a buyer.

Feb 03, 2010 08:25 AM
Deborah Fisher
Fisher & Company, P.A., Marketing & Creative Strategists - Fort Worth, TX

Elizabeth . . . is that a no, or a "NO!"?  

Let's see, the agent did not bring the buyer out . . . but . . . the buyer had been working with the agent for quite some time.

Will you change your opinion IF you knew that the agent had ben working with the buyer for months?

Feb 03, 2010 08:29 AM
Elizabeth Wange
Coldwell Banker Danforth - Kirkland, WA

That is a NO! Unfortunately for the agent, he did not have a contract. As we all learn at one point or another in our career, our word is only as good as the paper it is written on. I think the buyer was a stinker to cheat an agent out of the deal, especially since he had worked with him for months. But you know the saying...buyers are L---s.  It is too bad not to have had a buyer's agency contract!  Do you have new buyers sign one?

Feb 03, 2010 08:34 AM
Barb Van Stensel
Chicago, IL

The answer is "No".  It doesn't matter if this agent had been "so-called" working with these buyers for a long time or not.  You have to have something in writing prior to going into a FSBO or better yet, if the seller had asked the buyer's if they were working with an agent, because this seller wanted to sell.  Really doesn't matter.   The buyer's agent should have had a written agreement with the buyers that should something like this happened, and the buyer's possibly didn't disclose but wanted to save on what they thought was a lower price as a direct result of *screwing" their agent because just perhaps that didn't sign a buyer's agency agreement with this agent, that now, the agent wants what is due because he didn't protect his business to begin with? 

Feb 03, 2010 09:26 AM
Deborah Fisher
Fisher & Company, P.A., Marketing & Creative Strategists - Fort Worth, TX

Elizabeth: There was no agreement between the buyer and agent; would it have mattered if there was an agreement between the buyer and the agent? Just asking. In that case, who should pay the fee? The buyer or the seller?

Feb 03, 2010 01:41 PM
Deborah Fisher
Fisher & Company, P.A., Marketing & Creative Strategists - Fort Worth, TX

Barb: Thanks for throwing in your two cents.  This is a very interesting situation since it occurs so frequently.  I had actually anticipated more responses.  As of this moment, no one has voiced support for the poor real estate agent.

The price was the same with and without a real estate agent . . . and the buyer never mentioned that they were working with a Realtor . . . nor did the seller ask.

New question thrown out to all for consideration: in view of the fact that the buyer showed up on his own and without a Realtor, was the seller wrong not to ask if the buyer was working with a Realtor?

Feb 03, 2010 01:48 PM
Elizabeth Wange
Coldwell Banker Danforth - Kirkland, WA

Hi Deborah. Yes, it most definitely would have mattered if there were a buyer's agency agreement.  The fee is negotiated between all three parties, but it is a fee the buyer has agreed to pay according to ageny agreement.  But if the agent was able to negotiate the seller paying for it, then all the better for the buyer. And the seller had advertised he would pay it too. The seller really made out if he got a comparable price to others that were "listed" on an MLS service, beccause he did not have to pay a commission out of his proceeds.

I do feel for the agent! I have had this happen to me, and I thought I had an agreement signed too. It was not all inclusive though, so even with an agreement, you need to be sure of what it is agreeing to, read it carefully, they are not all the same.

It really is not the seller's responsibility to ask. They obviously thought they could do it without an agent to begin with. The seller probably knew an agent would try to get the 3% and he didn't want to pay it....more money in his pocket. The buyer was the real schmuck here though!


Feb 04, 2010 09:57 AM
Baker Home Inspection and Commercial Properties Inspections
Baker Residential and Commercial Properties Inspections - Springfield, VT
Home and Commercial Properties Inspections Vermont

Howdy and Evenen there Deborah

I don't believe the agent, should get anything from the selle of this home.

Baker Home and Commercial Properties Inspections

Feb 04, 2010 03:59 PM
Deborah Fisher
Fisher & Company, P.A., Marketing & Creative Strategists - Fort Worth, TX


Thank you for saying that it is not the seller's responsibility to ask the buyer if they are working with a Realtor.  To me, that would be the same as if I, as a broker, asked everyone I encountered if they were already working with another agent. I don't work with buyers personally, but if someone calls me about one of my listings, I wouldn't ask them if they are working with a Realtor. I just show them the home and try to "get them on paper" as a transaction broker.

If the buyer tells me that they are working with a Realtor, I will happily show one of my listings for the buyer's realtor, and have done so and sold the home for the Realtor who then was paid her 3% co-op.  I called her up and told her to write the contract and if she couldn't, I would be happy to do it on her behalf.

Feb 05, 2010 01:49 AM
Deborah Fisher
Fisher & Company, P.A., Marketing & Creative Strategists - Fort Worth, TX

Dale, greetings from the Republic of Texas!

Thanks for your input!

Okay -- so why aren't you in Texas or Oklahoma? How do cowboys end up in the arctic north? Are you raising polar bears instead of cattle?  Is there much of a market for that, and how do you call them in at the end of the day? (Just funnin ya! Think you are misplaced though . . . if I saw you on the street I'd think you were a fellow Texan! But NOBODY in their right mind leaves Texas! We all get here as fast as we can!)

Hey, no dancin' on the tables with your spurs on! 

Feb 05, 2010 01:55 AM
Dale Baker
Baker Energy Audits and Commercial Properties Inspections - Claremont, NH
New Hampshire Relocation Real Estate Information

Howdy and Afternoon Deborah

I just happen to be a misplaced Southern Grand State of Missouri cowboy. I do have family down Houston way, and alot of mighty good friends, from all over the Grand State of Texas.

Will my lady, is from these here parts. When one of the wise acres up here ask me, how did we end up with someone like you in our State, I just look right in the eye, and tell them that I'm here under orders from President Jefferson Davis and General Jo Shelby. lol

Sure did get a real hoot out of the polar bears raisen. I'd like to extend an invite to ya to join my good friends Carl and Ceil Winters over San Antonio way and I, at our monthly hang out blog post. Its always posted in the Texas groups.

P.S. so ya don't think your a seeing things, I've actually got two blogs here in the AR community. 

Baker Home Energy Audit and Commercial Properties Inspections

Feb 05, 2010 07:31 AM