Hey guess what..!? YOU CAN'T DO THAT!

By
Real Estate Agent with Keller Williams Realty

sell a house

It seems that at the end of every Real Estate Agent's career he/she could honestly write a novel.  I've been in this crazy business for over 8 years now and I am still, constantly surprised by other agents, my clients, brokers, you name it!  This past month has held a lot of firsts for me and it's just to the point you have to just laugh, handle it and move on.  So in one of my recent blogs I said that I had 2 agents send me offers from their clients, the seller.  Well, I only explained one outcome and didn't touch on the other because trust me, it deserves a blog of its own.

I showed a beautiful custom home in North Plano a couple of months ago that's priced at $1,000,000 - about $150,000 overpriced.  Long story short, my clients made an offer based on the comps (the facts) and, well, the seller is completely unrealistic and it didn't work out.

Last week the listing agent emailed me with a subject line of, "COUNTER CONTRACT: $875,000."  I was out showing and saw this come through my Blackberry and, as I'm sure you can imagine, I was ecstatic!  As soon as I finished with my clients I went back to the office to look over the contract and, to my disbelief, the seller gave my clients everything they wanted; she even replaced a few windows, installed sconces in the formal dining room, and offered to pay for the Title Policy and Survey.  I couldn't believe it until I reached the last page where it reads "Listing Broker to pay Selling Broker ZERO percent." WHAT!???  You have GOT to be kidding me!!  If the saying "if it's too good to be true, it usually is" was ever appropriately stated, it's here!

I could not believe an agent actually had the nerve to ask me, the buyer's agent, to not take a commission.  Not only can she not do this, my clients would NEVER agree to these terms.  They are long-time friends of the lead agent on my team and we have been working with them for over 2 years.

I reminded this agent that my clients only like the home but don't love it and they only want to move but don't have to.  I spoke to my clients and they said absolutely not; they would never do that to us.  But here's the kicker, legally the seller cannot negotiate commissions with the buyer.  Commissions are never to be negotiated in the contract to sell, they are negotiated between the seller and the listing agent at the time of listing and they agreed on 6% commission with 3% to be paid to the buyer's agent.  My contract is not with the seller, it's with the MLS and in MLS, the listing agent listed 3%.  So, in actuality, if the commission is dropped to 3% instead of 6, it is the listing agent who will not get paid.

I can honestly say this industry never ceases to amaze me.  I come across something astonishing and new almost every single day but it's what makes this business interesting.  So all you can do is take it as it comes and roll with it; otherwise you'll stress out and have a heart attack.

 

Posted by

Britney Elizondo

Buyer Specialist, REALTOR® | Vicki White Homes | a team within Keller Williams Dallas City Center | www.vickiwhitehomes.com

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Ambassador
2,083,030
Fernando Herboso - Broker for Maxus Realty Group
Maxus Realty Group - Broker 301-246-0001 - Gaithersburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

I would go ahead and settle it . . taking in consideration my client's best interest first. . 

. .then I would sue the broker for allowing the commission being part of a contract and ask for damages for making you go forward under duress .. . .and you being forced to  choose on your clients best interests. You will sue for the commissions that was originally advertised when you produce the client to the transaction. . plus you will sue for attorney fees.. plus

I would also let them know of this intentions before hand... just FYI

Done it before . .and it worked!

and no, there was no attorneys involved.

Dec 16, 2010 11:49 PM #52
Rainer
133,502
Kimberly A Norgard
Devlin McNiff Halstead Real Estate - East Hampton, NY

Wow.  That's absurd!  I've yet to hear that story.  I've, of course, heard about negotiating down the commission in order to make the sale happen, but this is over the top!

Dec 17, 2010 01:14 AM #53
Rainmaker
453,716
Allison Stewart
St.Cloud Homes - Saint Cloud, FL
St. Cloud Fl Realtor, Osceola County Real Estate 407-616-9904

Some transactions are just plain more friustrating than others. However, I commend you for taking the higher road and putting your clients above all else! 

Dec 17, 2010 01:19 AM #54
Rainmaker
90,932
Dana Voelzke
loanDepot (203) 733-9408 - Bethel, CT
Loan Officer/ First time home buyer specialist

Fernando has offered you an interesting possible solution. Keep us posted. There is business to be had in this market but nobody said it's easy. Lately I feel like the deals we close both the buyer and the seller are unsatisfied. We all need extra insulation against other people putting their problems on us!

Dec 17, 2010 02:00 AM #55
Rainer
238,693
Joel Gwillim
CIR Realty - Condo Specialist - Calgary, AB
Associate - REALTOR®

There is a difference between the listing agent asking the buyer's agent to take a hit on their commission which is perfectly fine and having the seller write it in to a counter offer, which they are also certainly within their rights to do.   Of course you cannot be contracted out of the pre-existing agreement between the listing brokerage on the MLS®, unless you agree to it in writing or have a Buyers Brokerage Agreement in which case it's becoming common practice.  The answer can be quite simply, a polite "no thank you, I'm not interested in that".

I think the listing brokerage would be hard pressed to enforce a commission agreement between the buyer and the seller in this manner, against a third party (you, without your consent) even if it was simply left in, as a term for argument sake.  I'm going to take this one to my legal team for further investigation.

Dec 17, 2010 02:04 AM #56
Rainmaker
180,729
Dana Scanlon
Keller Williams Capital Properties - Bethesda, MD
Bethesda MD- Award-Winning Bethesda Realtor

You are quite right ! The figure in the MLS listings showing the selling agent commission is, at least in my neck of the woods, the equivalent of a contract between the 2 brokers involved.

Dec 17, 2010 03:23 AM #57
Rainmaker
908,388
Pamela Seley
West Coast Realty Division - Murrieta, CA
Residential Real Estate Agent serving SW RivCo CA

In California it is illegal to mention or state commissions in a purchase contract or addendum to purchase contract. 

Dec 17, 2010 03:23 AM #58
Rainmaker
571,868
Bill Gillhespy
16 Sunview Blvd - Fort Myers Beach, FL
Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos
Hi Britney, Pretty amazing post. I would be tempted to proceed with the deal and let the agent twist in the wind a little. I had a similar contract ( it is illegal here in Florida ) and the agent replied that it is o.k. to negotiate commissions if it is plainly written into the contract ! Hope your Holiday Season is the best ever !
Dec 17, 2010 03:40 AM #59
Rainer
97,485
Glenn Freezman
Nucazza LLP & Home Buying Evolution, & Family Abstract, Inc - Fort Washington, PA

 

Brittany,

Have you heard of the task based or ala carte or "BUY" the hour models that are being erected in the real estate community.  The system is very easy, if a buyer is as serious about buying a home as sellers are about selling them then they pay you for your functionary work at a fixed rate and the more important fiduciary work at a higher rate.  The Realtor benefits because they are being paid, as every other professional service provider is paid and the home-buyer can then receive the apportioned commission as cash back at closing, a concession towards closing costs or a reduction of the sales price.  (By addendum).  Its such a win win.  Aren't Realtors(R) tired of working for free, tired of the positive outcome being your only income?  I really like the Model that we are helping to develop and hope to be able to have continued dialog regarding it.  Home Buyers, its about time you put your money where your mouth is! HBRevolution.com 

Dec 17, 2010 04:09 AM #60
Ambassador
526,000
Tom Branch
RE/MAX Dallas Suburbs - Plano, TX
Broker, CDPE, SFR, ACRE, Plano TX Ambassador

Fernando #53,

As a REALTOR(R), you're bound to arbitrate commission disputes. If you file a lawsuit, you likely violate the COE.

Tom

Dec 17, 2010 06:08 AM #61
Rainer
261,153
Marge Draper
Keller Williams Realty Palo Alto - Menlo Park, CA
REALTOR, Keller Williams Realty, Menlo Park CA

This gets on the list of 'I thought I've heard everything'.  Perhaps the listing agent was trying some creative negotiating  ---  that's giving a huge benefit of the doubt.  It was probably intended as the slap in the face to you and your buyers that it sounds like.

Since your buyers only like and not love the house, why pursue it?

Dec 17, 2010 06:11 AM #62
Rainmaker
19,508
Gabe Fitzhugh
GF Homes and Land - Cumming, GA
REALTOR®, Associate Broker

Legally, a buyer agent's contract for commission is the MLS listing.  Your buyer may have been able to accept the counter offer and you could still proceed to closing and get paid the amount the MLS listing stated you would get paid.  It would be up to the listing agent to fight for their commission.

Dec 17, 2010 09:10 AM #63
Rainer
71,051
Andres Munar
Keystone Alliance Mortgage - State College, PA
Experience The Difference

What a funny story. Thanks for sharing.

Dec 17, 2010 10:38 AM #64
Rainer
353,360
Jim Cheney
Saint Francis Property Santa Rosa, CA - Santa Rosa, CA
Rincon Valley Realtor 707.494.1055

That is absurd. 

Dec 17, 2010 11:15 AM #65
Rainmaker
440,211
Rodney Mason
Guaranteed Rate NMLS# 2611 - Atlanta, GA
VP of Mortgage Lending - AL, FL, GA, SC, & TN

I would be that the other agent was shocked that you would not agree to take 0%.

Dec 17, 2010 02:19 PM #66
Rainer
117,531
Robin Risley
Kamali Sotheby's International Realty - Cannon Beach, OR
CRS, GRI, Principal Broker

You have to be on your toe and read the fine print....I agree with alot of the other comments. This agent is interested oin playing games....not getting the house sold for her sellers.

Dec 17, 2010 04:46 PM #67
Rainer
241,977
Justin Dibbs
Pearson Smith Realty - Ashburn, VA
REALTOR® - Ashburn Virginia Homes for Sale

That's why I always print out a copy of the listing in case something like this happens.  I can't say I'm surpirsed.

Dec 18, 2010 02:44 PM #68
Rainmaker
409,262
Karen Monsour
Coldwell Banker Fort Lauderdale Beach - Fort Lauderdale, FL
REALTOR, SSRS - Sells FL Waterfront, Short Sale Expert!

Justin,

I agree and my coment stands as above, HOWEVER, contrary to most, I include the MLS sheet as part of my contract...and put that in the special conditions line,,,as per MLS#9090909090...you wrote the sheet, not me, and so these are the conditions of the sale. Period, end of story.

Dec 18, 2010 04:00 PM #69
Rainmaker
531,363
Karen Feltman
Cedar Rapids/Iowa City, IA KW Legacy Group - Cedar Rapids, IA
Relocation Specialist in Cedar Rapids, Iowa

I agree that this seems to be a violation of the MLS rules and this agent should be turned in for this atrocious behavior.  You are fortunate to have such loyal clients!

Dec 21, 2010 09:29 AM #70
Rainmaker
409,262
Karen Monsour
Coldwell Banker Fort Lauderdale Beach - Fort Lauderdale, FL
REALTOR, SSRS - Sells FL Waterfront, Short Sale Expert!

To those of you (hijacking for a moment) who think you can arbitrate...well, yes you can, however, if they have no money or spend their compensation and again, have no money...at the end of the day she won't get compensation.  While the other agent might lose her license, she is still losing out.  I say, get her broker involved and insist on getting renumerated.

Dec 21, 2010 03:19 PM #71
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Britney Elizondo

Your Dallas Home Buying Specialist :: 940.453.5308
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