Question Details

Mike, Other/Just Looking in Los Angeles, CA

Should my broker pay for the county transfer fee in an REO transaction?

Asked by Mike, Los Angeles, CA Thu May 10, 2012

My wife and I found the place ourselves on the MLS and decided to go directly to the listing agent. We got approved and are about to close escrow when I see this extra $1800 charge on my GFE for county transfer fee. I called my broker to ask and he told me that 99% of the time it's paid by the seller, but this was the 1% time where i would have to come up with it. Is it ok to have him meet me in the middle and split it with me?

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6
99% is a large percentage... but you apparently fell into the 1% zone.

It's not your broker's fault that you fell into the 1%, and since he is not purchasing your home, nor does he plan on living in it... no, he shouldn't pay the transfer fee.
1 vote Thank Flag Link Thu May 10, 2012
Alan May, Real Estate Pro in Evanston, IL
MVP'08
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You can ask however nearly every REO contract has the buyer paying all transfer fees. Did you read the contract and seller addendums that outline who pays what before signing them. In order to have the seller pay 1/2 the transfer tax which is actually customary, you would need to have that in your initial offer asking them to do it. Some buyers do ask for the seller to pay all and it usually gets countered that they will pay half. The key is did the listing agent tell you the seller pays for it and then it was not put in writing? if so it is their fault and yes you should have them pay. If you did not read it before signing it then it is your fault for not reading what you are signing. good luck on your closing, i hope things work out
Web Reference: http://www.ScottSellsNH.com
1 vote Thank Flag Link Thu May 10, 2012
Why should the broker pay for the county transfer fee? They aren't buying the property. The listing broker's job is to market the property, conduct negotiations with their clients' best interests in mind, and manage the transaction through closing. If you had had your own representation, they probably would have asked for the seller to pay some of your closing costs but that ship has sailed.
1 vote Thank Flag Link Thu May 10, 2012
Unfortunately, it does sound like you will have to pay this fee, and if it is, in fact, on your GFE, then your loan officer did disclose it. In some counties in our area, this fee is split between buyer and seller, and one county in particular waives it for first time homebuyers. I do not know what county your purchase is in, but you might explore that option.
It is not typical in any county for an agent to pay any transfer taxes. However, since you dealt with the listing broker, and they are getting both sides of the transaction, you can always ask.

Good luck! Jim
0 votes Thank Flag Link Fri May 11, 2012
Hi Mike,

It depends on which broker you're talking about.

If your mortgage broker failed to properly disclose the transfer tax when he/she sent out your initial GFE, by law, they have to eat it.
0 votes Thank Flag Link Thu May 10, 2012
Good answers below. This could have/should have been up for negotiation. If you had your own buyer's agent you probably wouldn't be asking this now. This is why you never use the listing agent as a transaction broker. He's essentially working for the seller! Hard lesson learned.
0 votes Thank Flag Link Thu May 10, 2012
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