Bad Boise Short Sale Practice

By
Real Estate Agent with Jon Gosche Real Estate

I just had a new Boise short sale listing pop up and the commission offered to the seller agent was 2%  There was also a document attached to the listing entitled "Why only a 2% commission?"  The agent went on to explain how he respects real estate professionals but becasue it is so hard to get listings and because of increased cost and legal liabilities he deserves 4% and buyer agents should get the extra 1% by charging their buyer clients.

I popped up this agent's listings, active, sold and canceled.  He has 14 listed active, some contingent short sales meaning that they have at least one offer and are in the negotiate with the lender stage.  He has closed 71 (pretty good) BUT HAS 83 canceled or expired.  That means that he has well over 50% of his short sale listings fail!  This is not good!  It may be average but it isn't good for those would be sellers who run out of time and end up in foreclosure.

My son in law and I have closed around 130 short sales.  We rarely have had to pay less than 3% to a buyer agent.  A very few times we have cut our commission to get a deal done.  We have very few failures.  Most buyer agents cringe when they see decreased commission and it is actually insulting to cut buyer commissions.  Why?  Because buyer agents spend hours and lots of gas showing buyers homes.  The listing agent with a short sale is dependent on having a great relationship with buyer agents because it is the buyer agent who needs to educate the buyer and keep them in the game long enough to sell.

It used to be that few agents wanted to handle short sales at all and we often received referrals from other agents and we pay them a good referral fee.  When we get offers through other agents we work with them to get their buyer locked in first position so they aren't strung along for weeks or months and then lose the purchase.  Being a good listing agent is NOT harder than being a buyer agent.  But it does take experience, excellent negotiation skill, excellent pricing and diligent perseverance.  If you are a seller and your agent wants you to agree to pay less to a buyer agent you should think twice and you should always have your prospective agent show you his or her listing and closing record.  Failing a short sale can really mess you up and cause you to run out of time and end up in foreclosure.

This agent also encourages other short sale listing agents to cut buyer agent commissions and keep more themselves.  I wonder if he is treading on breaking the Sherman anti-trust law attempting to price set with other agents.  I wonder if he has short sale certification from a bank!  Your listing agent should be serving your best interest and on top of the best interest list is if he or she lists your house, get it closed!  Short sales are getting trickier.  Because prices are rising lenders are now often counter offering.  But good organization, persistence and thorough Broker Price Opinions should serve to result in closing your home very close to the listing price.  You also want to make sure that you apply for HAFA because you may be entitled to receive cash at closing.  Boise Short Sale prospective sellers need to be careful choosing a seller agent.  We would love to help.  Call Jon Gosche @ 208-870-2115.  Read more at Boise Short Sales.  Avoid bad Boise Short Sale practice.  Be fair and pay those buyer agents.  Help work with their buyers.  It is more frustrating being a buyer even than a seller in a short sale.  You need to treat the buyer agent right and help them with their seller.  You don't need a listing agent that is actually discouraging buyer agents from trying to sell your home.

Comments (4)

Doug Rogers
Bayou Properties - Alexandria, LA
Your Alexandria Louisiana Agent

I closed on my last short sale on Friday. Will NEVER handle one again. WAAAAY to much headache/paperwork/and uncertainty.

Feb 19, 2013 12:14 AM
Jon Gosche
Jon Gosche Real Estate - Boise, ID

It ain't for everyone is it Doug.  We actually like them.  You need to find someone hard headed like us and have them pay you a referral fee.  Thanks for the comment.

Feb 19, 2013 12:21 AM
Ralph Janisch ABR CRS Broker
Janisch & Co. - Conroe, TX
Selling Northwest Houston to good people like you!
Not planning to ever do a short sale. I personally would rather take a referral and let folks like y'all who like it do them.
Feb 19, 2013 01:42 AM
Anonymous
john

Yep - One of the greatest disservices that a short sale listing agent can do to their client is to do things that dissuade a buyer agent from bringing their client to the property - that includes consistently reducing buyer agent commissions, charging buyers a short sale processing fee as a closing cost, etc.

Feb 19, 2013 03:22 PM
#4