This is REAL problem with "regular" agents.
A commission should be earned when it's PAID by the tenant. This is more so in commercial real estate.
Most agents/brokers will ask and get paid a comm when the deal is signed - for the LENGTH of a contract.
So assume a 50,000 year lease for 5 years - $250,000 total rent.
At 5% (most comm want more) that's $2500 per year or $12500 for the term over 5 years - what if ten years? $25,000 per year.
Well, what if the tenant leaves after 6 months and the landlord paid you a $25,000 commission.
Guess how my broker who has been around for 40 YEARS handles this - WE TAKE commisison on the anniversary of the lease. IF THE LANDLORD MAKES MONEY< WE MAKE MONEY - YEAR AFTER YEAR.
It's an annuity.
I get MORE listings working this way, have a great tax planning, and know I have incomefor the next 12-18 years - assuming my tenant who I swore to is a GOOD tenant today and tomorrow.
It builds TRUST.
The best thing to do in this situation is whatever your heart tells you!
Best of luck!
Commission is earned when you secure a ready and able renter who voluntarily enters a Lease Agreement. I assume all the usual steps of checking out the tenant's qualifications were done (credit check, employment check, prior residence check, etc.)--to the landlord's satisfaction--before the lease was signed. I also assume the Landlord had enough sense to require a security deposit. If the answers are "yes" in both instances, then you've done your job and are entitled to keep your commission. In addition, since the tenant moved out without any real reason and therefore, broke the Lease, the Landlord should be entitled to keep the deposit. If you feel bad for the Landlord, you can always offer to locate another tenant for them at a reduced commission (or for free, depending on how strongly you feel about it), but you're certainly are not required to return the commission.
Broker, CRS, GRI, ePro
Raving Real Estate
Laramie, WY 82070