It's redundant I say! It's redundant I say!

By
Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

As most of you know, TLW and I have never worked in a regular Real Estate office before. We worked in a property management office for a few years but were the only REALTORS® there, so we learned our craft through trial and error and attending meetings at our local board of REALTORS®. By learning this way we have always done things our own way and really don't have a clue how other offices conduct their business.

So with that in mind, I have a question for you. I received an offer for one of my listings on Friday and as usual it had an additional four pages of disclosures and "CYA" type stuff that really had nothing to do with the transaction. I assume they are just corporate paper work requirements. To me, they are a waste of time and mostly redundant. It seems like whenever I do a deal with one of the "Big Boys" I spend the next week getting miscellaneous forms, from the Buyer's agent, that they need the Seller to sign ASAP. My first problem is, I'm a busy man, if you have things you need my Seller to sign then please get them to me all at once so I can take care of it and be done with it.

In Florida, we have a pretty comprehensive contract, the FAR/BAR. It has two pages of fine print (the standards) that cover just about everything. Inspections, insurance, liability, default remedies, escrow monies, termites, title, closing costs, time is of the essence etc....Other than a Home owner association disclosure, lead base paint and maybe an addendum with extra terms of the contract, we really don't need any additional paper work. Everything else, in my opinion, is redundant and a waste of time.

Anyway, the offer I received on Friday had this clause typed right on the contract:

  • Pursuant to Section 475.42(1)(j) Fla. Stat., Seller and Buyer hereby grant Broker the right to place a lien on the property to ensure payment of services rendered. For purpose of this paragraph, Broker will be treated as a party to this contract.

Now folks, I have to say, I scratched this clause out. There is no way my Seller will be agreeing to this. Am I missing something here? Would you let your Seller agree to something like this? I have a valid listing agreement and I have offered compensation through the MLS. Why do they need to put this clause in the contract? In my opinion it has absolutely nothing to do with the transaction between the Buyer and the Seller.

So my question is....What's up with this? Will corporate reject my contract because we removed their "make sure we get paid" clause? Are your offices burying you in unnecessary forms and disclosures? Is this normal practice in the corporate Real Estate World? Maybe, I just like things too simple and straight forward. What say you?

Posted by

 

Join Our Facebook Fan Page Check Us Out On Google+ Follow Us On Twitter

 

***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

The BIO for Bryant Tutas

 

 Tutas Towne Realty, Inc handles Florida real estate sales, Florida short sales, Florida strategic short sales, Florida pre-foreclosure sales, Florida foreclosures in Kissimmee Florida Short Sales, Davenport Florida Short Sales, Haines City Florida Short Sales, Poinciana Florida Short Sales, Solivita Florida Short Sales,  Orlando Florida Short Sales, Celebration Florida Short Sales, Windermere Florida Short Sales. Serving all of Polk, Osceola and Orange Counties Florida. Florida Short Sale Broker. Short Sale Florida.

 Copyright © 2017 http://www.brokerbryant.com/ | All Rights Reserved

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Tags:
opinion
redundancy
contracts

Spam prevention
Show All Comments
Rainmaker
125,300
Mary Ann Daniell Realtor
Coldwell Banker United, Realtors - Subsidiary of NRT LLC - Killeen, TX
Delivering Successful Results Since 1999

In Texas, bless TREC's heart, we have "fill in the blank" contracts.  We must color within the lines!  Agents are NOT permitted to write such a clause in ANY contract or disclosure as it could be interpreted as practicing law without a license.

 

Apr 23, 2007 10:11 AM #63
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Mary Ann, Ours are also fill in the blanks.  Unfortunately one of the blanks is for additional terms. This is where folks get a little carried away.
Apr 23, 2007 10:51 AM #64
Rainmaker
368,690
Miriam Bernstein, CRS
Rochester, NY

I didn't read all of the comments so hopefully am not repetitive.  If that law exists as a protection for the brokers, why not?  Was your seller leaving the state?  Have you ever had the experience of going to the closing table and not getting paid?  In New York they are trying to pass a law to protect the broker and their commission against sellers who leave the state and run out on the broker and the commission.  In New York we  have a similar statement that needs to be in the contract or it is not enforaceable and that has to do with a tenant purchasing the rental the broker found for them.  If an agreement is made that a commission will be paid if the tenant buys the property and the agreement is not in the actual contract it is not enforceable.  In terms of the "big boys" and their paperwork and needless nonsense pile it up and one tirp to the seller, if they need it right away, tuff. 

If you believe your seller will pay you, have no question about it, why not have him sign if it protects your rights?

Apr 23, 2007 12:55 PM #65
Rainer
23,647
Daniel Gates
Insure Consulting - Palm Bay, FL

Two men stand and watch as a bus apparently full falls off a cliff and bursts into flames.  One man turns to  the other and says  'that there is a darn shame', agreeing the other man says 'yes, what a waste of life'.  'no, no you hear me wrong friend, that there bus was full of lawyers' says the first man.  the second man replys 'why then the remorse'.  'empty seat' says the first man.

Everyone has heard it, just seemed real appropriate though.

Apr 23, 2007 01:30 PM #66
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Hi Miriam, Thanks for taking the time to read and voice your opinion. In Florida the commission clause is truly not needed in a residential contract where both sides are REALTORS. My listing agreement gives me the power to enforce a commission and the other agent is protected through the MLS. Even if the seller left the state and stiffed us should we have the right to lien a property that he no longer owns? Daniel, I have heard that and it is very applicable to this posts. Thanks.
Apr 24, 2007 12:16 AM #67
Rainmaker
368,690
Miriam Bernstein, CRS
Rochester, NY
All listing agreements have clauses regarding commission.  I am curious what good that will do you in a circumstance where you do not get paid at closing and the seller moves out of state.  You can follow the seller and hire an attorney where their new home is and attempt to recover the commission.  Your listing agreement is not going to do you much good.  The lien is placed, you are paid, the lien is lifted and title passes.  Why not?  If the law exists first of all it exists for a reason.  Secondly why not?   There is no jeopardy to the seller if he intends to pay you.  Have it happen once.
Apr 24, 2007 02:11 AM #68
Ambassador
557,018
"The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

"TLW and Jeff Behave!!"...

Why?!?!?!?  LOL. Wink. Wink.

TLW...ROAR!

Apr 24, 2007 02:25 AM #69
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Miriam, The clause is coming from the buyers agent, not me. Sorry, but my seller will not be authorizing another broker to lien his property. This clause is actually quite normal in a commercial deal but not residential. At least not in Florida. I understand your point. Closings in Florida are handled diferent than NY. In fact we don't use Attorneys at all in a RE transaction(thank goodness).   
Apr 24, 2007 02:54 AM #70
Rainmaker
368,690
Miriam Bernstein, CRS
Rochester, NY
Ok.  In New York when the listing is taken the listing agent pays out a commission to the "buyer's agent"  The buyer's agent has recourse and the listing agent is responsible to ensure that the buyer's agent gets paid.  How is the buyers agent protected in FL.  Does the seller pay the buyers agent out of the proceeds? and since the buyers agent has no agreement with the seller, what agreement with who ensures that they get paid?  Curious how it works down there.
Apr 24, 2007 03:17 AM #71
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Miriam, My listing agreement ensures that I am paid as the listing broker. The offer of compensation in the MLS ensures that the selling broker is compensated by me. Normally commissions are paid by the closing agent(title company) at closing. They are paid from the seller's proceeds as part of the HUD1 and are paid directly to BOTH brokers per the closing instructions. Any commission disputes between brokers are handled at the local Board of REALTORS(R) via arbitration or mediation. If the seller refuses to pay me I can sue him under the terms of my listing agreement. The selling broker's dispute would be with me not the seller. My dispute is with the seller. The selling broker could win a payment from me whether I get paid or not.
Apr 24, 2007 03:44 AM #72
Rainmaker
453,651
Allison Stewart
St.Cloud Homes - Saint Cloud, FL
St. Cloud Fl Realtor, Osceola County Real Estate 407-616-9904
Bravo, Bravo Broker Bryant- That new clause is MOST alarming. I went from a wheelbarrow full of redundant forms to the streamline process with my new Broker..my back thanked me, my broker makes life simple and gee we still get it done...how can that be? Check here if you agree, attach sheet C and conditional response with the agreed upon statement above., LOL
Apr 24, 2007 03:47 AM #73
Rainmaker
87,192
Paula Henry
Home to Indy Team @ HomeSmart Realty Group - Avon, IN
Realtor - Indianapolis Real Estate - 317-605-4174
Broker Bryant - I have never seen a clause like that and am with you, throw it in the lake. I absolutely hate having to take numerous documents back to my seller for the prurpose of another Brokers "office policy". Give them to me all at once! Question: Why would a broker or agent want to be a party to the contract? Do they enjoy the extra liability?
Apr 24, 2007 05:07 AM #74
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Hi Allison, Glad to hear Coach is minimalist like me. I just don't like useless paperwork.

Paula, I'm not sure why they would want to be a part of the contract. I wonder how their E&O company would feel about that?

Apr 24, 2007 05:22 AM #75
Rainmaker
368,690
Miriam Bernstein, CRS
Rochester, NY
The process up here in NY is basically the same.  The agreement signed by the seller is a document that says he will pay you.  Same thing here.  Paid out of the  proceeds based on HUD, etc.  Commission disputes in the New York are not handled by mediation by the Board because, they don't get involved in  commission issues. So the question is what if the seller doesn't pay you? Closes, and leave the state.  Are you saying it can't happen.  Are you then not on the hook to pay the selling broker?  I have had this expereience.  Had the agreement with the seller,  was on the MLS, obligation to pay selling agent through the MLS.  KACHUNK.
Apr 24, 2007 06:44 AM #76
Ambassador
1,090,672
Celeste "SALLY" Cheeseman
Liberty Homes - Mililani, HI
(RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE
I like that last comment...how would their E /O company feel about that?  I think it would sky rocket at that point!  Thanks for your positive stuff on mine earlier...just came to get comfort over here. 
Apr 24, 2007 06:36 PM #77
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Miraim, Honestly, I don't think it will ever happen with me. I have a very good relationship with my sellers and I have no agents under me. I do everything myself. It's a risk I'm willing to take. Plus just because they leave the state doesn't mean I can't enforce my listing agreement. I could still sue. 

Sally, Thanks for stopping by. Hope it helped:)

Apr 25, 2007 01:35 AM #78
Rainer
32,215
John Evarts
Classic Property Management of Santa Clarita - Santa Clarita, CA
Awesome. That picture made me laugh my head off! This happens all the time and it seems there is more redundancy the bigger the company.
Apr 27, 2007 06:33 AM #79
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Hey John, Thanks for stopping by. It does seem like the larger the company the larger the stack of "CYA" docs. I guess I can't really blame then too much. With a huge amount of agents the broker or corp would definitely want some protection. But please just give me everything at once.
Apr 27, 2007 09:41 AM #80
Rainer
34,079
Anna Lukyanova
Century 21 Sundance Realty - Daytona Beach, FL

Bryant,

You are right it is redundant, but we, real estate agents, do a lot of redundant things through out the sale, starting with in AS IS contract inspections clause and FHA riders. I swear it takes time for the customers to "digest" what's going on. Not that they are "slow" it is just they have to make a lot of decisions and usually are under a lot of pressure and therefore are easily destructed.  Sometimes, I feel like saying" Ok, for those of you that did not get it the first time..."

Love your graphics..

Apr 30, 2007 04:48 AM #81
Rainmaker
595,381
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate
I'm in the Daytona area. I agree with  many of the previous responders. We're not supposed to try to practice law. Into the lake it goes! There's one right behind my office. Would you like me to toss if for you?
Apr 30, 2007 05:42 AM #82
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
1,142,060

Bryant Tutas

Selling Florida one home at a time
Ask me a question
*
*
*
*
Spam prevention