Home Buying in Los Angeles>Question Details

Irene Yamaga…, Real Estate Pro in Arcadia, CA

Can you refer me to transaction fees charged sellers or buyers in CA. I thought there has been a law suit over this and RE companies stopped.

Asked by Irene Yamagata-Bermudez, Arcadia, CA Thu Dec 8, 2011

Coldwell Banker is charging buyers $295.00 transaction fee, is this permitted and have there been lawsuits?

Help the community by answering this question:



I can remember the first time I heard of this practice and having my response include a “high-quality” expletive ;-)

Here’s the good news:
Since you are a CA Realtor® answers to questions like this can often be found at the CAR Legal website once you log in.

Here are a two links with extracted key quotes to review regarding your question:

Commentary that covers a decision of a federal district court in Alabama [Busby v. JRHBW Realty, Inc.].

"This decision serves as a good reminder for REALTORS® to refrain from charging unearned fees under RESPA."


Commentary that covers a letter from HUD's General Counsel Helen Kanovsky that clarifies the distinction between using a formula to calculate a legitimate commission, as opposed to an unearned fee that violates RESPA.

"As an example, a listing broker charging the buyer an administrative fee absent any contractual relationship between the listing broker and buyer may be evidence of a RESPA violation."


Finally, you can also call the CAR Legal Hotline and speak with a lawyer regarding your situation for FREE!

2 votes Thank Flag Link Thu Dec 8, 2011
Don't sign the escrow amendment and the Listing side will need to pay, or waive the fee.
0 votes Thank Flag Link Tue Dec 13, 2011

I am with Coldwell Banker (owned by NRT) and they stopped the practice of collecting this fee a couple of years ago. If this is a branch owned by NRT I would contact the manager to discuss this. If this is a Franchise branch (independently owned) I'm not sure what the policy is. Your client should not have to pay this fee if they don't want to. Ask the other agent to cover it since it is his/her brokerage charging it.

Angie Simpson
Coldwell Banker
0 votes Thank Flag Link Thu Dec 8, 2011
You don't need your Buyer to sign this amendment. It sounds that this is not part of your contract since you're representing your Buyer.

You should address this issue to the DRE for bad business code practice.

Doug Perez
0 votes Thank Flag Link Thu Dec 8, 2011
I wouldn't wait and see, I would make it perfectly clear that my clients were not agreeing to nor paying for that fee. I assume the agent you are referring to is the listing agent? That is even more crazy!
0 votes Thank Flag Link Thu Dec 8, 2011
I should havae made myself clearer. I represent the buyers and escrow sent buyers an amendment asking buyers to sign $295 transaction fee. Buyers have not signed this and the agent told me that they didn't pay it he would have to. I have never charged my buyers a transaction fee as I feel this is all part of doing business and closing escrow. We will see if escrow charges buyers without a signed amendment..
0 votes Thank Flag Link Thu Dec 8, 2011
It is permitted, but in my opinion, unethical. How you can justify passing the cost of YOUR paperwork to your client is really amazing to me. I always use a transaction coordinator and always pay for it myself.

Sinead McAllister
0 votes Thank Flag Link Thu Dec 8, 2011
I can't tell you about CA, but I know in Colorado they still charge $199. I know many agents for Coldwell Banker HATE this fee and refuse to pass along this charge to their clients, so they pay the fee themselves out of their commission. I was with CB for three years, and never paid it myself, and never had a client object to it. This is one reason why I left Coldwell Banker.
Web Reference: http://www.sallygrenier.com
0 votes Thank Flag Link Thu Dec 8, 2011
I've seen that before and wonder why anyone would agree to pay that fee. Isn't 5% to 6% enough.
0 votes Thank Flag Link Thu Dec 8, 2011
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