It is a tough market but if you had a completely unrealistic budget to your requirements than the agent should have fired you earlier than a year into it.
My own advice - don't been penny wise, pound foolish. If you find a right house for your living situation than make an attractive offer - good combination of price and terms. I think you'll thank yourself in the future.
Today's market is rough. I feel really bad for my clients who are constantly outbidded by all cash buyers waiving all contingencies. After a year of not feeling that you're moving forward is ample time to make a decision about who represents you in a huge purchase.
Your second real estate agent is no way obligated to giving the fired real estate agent a referral fee. However, if you do happen to purchase a property that your first agent showed you, there may be an issue.
Good luck and I hoppe you get a house quickly!
"We have been working with a realtor for over a year to buy a house. Inspite of giving the realtor a fair chance (we put in 4 bids, clarified our budget etc), nothing has worked out for us."
Is it the Realtor's fault four of your offers were rejected, or was it the current market at the time? Did the Seller(s) receive a "better" offer than yours (not necessarily price; contingency timelines might have been shorter, larger deposit, 100% cash, etc.)?
"Certain advise we received from him (waiving appraisal contingency on an overprices house, preference over his mortgage contact over credit union even if its a little more expensive etc) was not what we felt was right for our famil we decided to change realtors."
Were the properties over-priced or were you under-funded for the market targeted? Did you ask your Realtor to go back and look at the final sales price of the four homes?
Most all Realtors have a preference for where their Clients obtain funding. This is because we like to work with seasoned mortgage professionals to reduce our Buyer's risk and be able to have clarity regarding the exact status of a Client's loan.
For example, there are 2 types of loan conditions we need to stay on top of to meet contingency timelines of the purchase contract: 1) Prior-to-doc (PTD) conditions are those that must be satisfied before the lenderâ€™s underwriting department will generate and send loan docs for you to sign at escrow. 2) Prior-to-fund (PTF) conditions are those items that must be satisfied before the investor will â€œpush the buttonâ€ to send your new loan funds to escrow. To be proactive regarding #1 & #2, I ask for the lender-specific list of PTD/PTFs generated by the Underwriters and go over it to get ahead of any potential issues that may affect funding, which could place your good faith deposit at risk, and/or lead to the money spent on appraisal/credit report/property inspections to be wasted.
Additionally, while some may believe "all lenders are the same"; in fact, the opposite is true.
"We did not feel we were getting the right advise, negotiations skill or guidance needed to get a house quickly and its been 1 year of looking already."
Did you bring up these concerns to your Realtor? Communication is a two-way street......
"The old realtor now contacted us and wants us to ask any new realtor we sign up to give him 25% of the commission in leui of his efforts spent (on failed past bids). I do not think this is fair to any new realtor since we are changing relator for professional reasons and it was a performace based agreement where we did not get success."
If you honestly believe your Realtor is 100% responsible for not successfully obtaining a home within the year I suppose you would have a point. However, I believe the likely reality is the market played a bigger role than you want to acknowledge and/or your opinion of value did not match that of the Seller's; and hence, your offers were not accepted.
Although your previous agent spent a lot of time with you, submitted several offers and tried to help you, it didn't result in a successful transaction.
You are free to work with whomever you desire. I do not agree with the first Realtor in asking for a referral fee from the next Realtor you work with. Although if you buy a property that you previously viewed with Realtor #1, he may have a "procuring cause" claim against earning the fee.
The way I would handle it is to give Realtor #2 a list of the homes you already viewed with Realtor #1 so he/she 1) Has knowledge of your property history and 2) Realtor #2 can learn more about what your likes & dislikes are to better help you find the new home of your dreams.
If there is a previously viewed home you want to go back to and offer on, discuss an equitable situation with both Realtors before a battle ensues as to who actually earns the fee.
And be completely honest with the new Realtor you work with and through open communication a more desirable outcome with happen.
Samal, sometimes it's just time to move on, and I do think, based on what you have shared, that it is time for you to interview and find a new agent.
Clearly, there is something missing in the relationship with the current agent, that, after a year of working together, should be present.
While I do have empathy and feel for your original agent, I do not think he should ask for a referral fee....... unless, of course, he is the one who helps you find someone new, and actually refers you to someone.
Good luck and I hope you find what you're looking for soon!
I am sorry it did not work out with the first realtor.
If you were VERY clear with your agent on your max sales price, type of home you desired (Single Family vs Condo) , area you desired, and type of sale ( standard sale, short sale ,or REO), and he/she still did not work diligently to finds homes within your specs and budget, you have every right to change agents.
However, if you did not make your desires CLEAR to your realtor it may be unfair to blame him/her for not finding you a home. Maybe they did not show you some homes because they did not think they would meet your needs. For the most part buyer's agents are the hardest working agents in the business. They spend hours searching for homes for their clients. The success of their business depends on making their buyr's happy enough to refer a friend or relative to them.
Now, the fact that you were working with an agent for one year and only submitted four offers, implies that you guys may not have been on the same page.
As far as the new agent paying a comission to the old agent, that would only be in order if you have the new agent write an offer on a home the old agent had already shown you. If your new agent finds a home for you, and you are viewing it for the very first time, no comission to the old agent of any kind is in order.
Best of Luck to You!
Kawain Payne, Realtor
I want to be fair to all parties involved with my comments here.
If you are looking for REO, Short-Sale, Foreclosure properties and you have hard to find criteria.( good contdition, good area, etc) .it's not that unusual to spend 6 months looking or even longer then that. It's a very difficult market in the distressed property arena, and many buyers are being outbid by all cash investors.
If you truly feel your agent has give you poor advice, then by all means shop around for a more experienced agent. I'm not sure what you mean by "performance based agreement". The Standard buyer/broker agreement outlines your duties and obligations but the term performance based is not in it.
I don't think a new realtor will sign anything unless the present agent has referred you to them. Please take a good look at your agreement though since I'm not sure what you signed.
Question - did you sign a buyer's contract? If so, the agent may be entitled to something. That would be specified in the written contract you created orginally. If however, you did not sign a contract, then you owe that person nothing.
Hope that helps...
It's not enough info to determine why you're giving up on your agent. It would help to hear from your agent's side of the story though to help you better.
If you don't feel comfortable and don't have an agreement with your agent, fire this agent and get a new agent. Also, there are many agents who would not mind paying a 25% as a referral fee.
Don't think about what's fair for your new agent, think about you and your family best interest, first.
You shouldn't be expected to continue with this agent. Don't worry, and I hope you find something soon.