they waited weeks before bringing up this request?
It never came up in conversation prior to that?
Well...........Just smile and politely say no.........and let them walk away
AND, you might let them know you will go after the commisson if they buy any house you showed them through another agent simply because you wouldn't allow them to hold you hostage over a demand (after the fact) for a 75% rebate......
Then make sure to smile again!
Having a good appreciation for the expenses involved including your time in printed form could go a long ways to resolve this issue. Too many people are willing to give away their time.....
As I see it we are the cause of this problem.....too many agents are caving to these requests creating the illusion that all agents are willing to cut fees for professional services. The fact that so many agents think so little of the services that they provide and are willing to give it away is a disservice to not only them but other agents as well.
Sometimes being a professional means having the courage to stand up for what is right.....and that can mean simply walking away from opportunities like these.
You briefly explain them. You then give them prepared lists of resources such as lenders, title companies, attorneys, insurance people, home inspectors etc that you typically recommend as well as a sheet of web links for other resources such as the sex offenders registry, DOT, public schools etc. You do this as this is what you're offering them of value for their time. You then encourage them to discuss with you what it is you're ideally looking for and you ask them questions and make notes. This is critical you need to understand what their looking for. Then you wrap up by telling them how you work and what they can expect from you and how you get paid and explaining the critical importance of a buyer getting pre-approved for a mortgage. Then ask if they have any questions.
This is where if they want part of your commission they will tell you, and if the question arises be prepared. My response has been the same for over twenty years. I don't budge on my commission, I have a minimum I'll work for 2.5% and a maximum I will accept 3% I don't do bonuses, and won't work for less than 2.5% and this is clearly stated on my buyer broker agreement. I also let them know we're not going to be signing a buyer broker agreement immediately, I will work with them a few days before I decide whether I want to work with them further and then if I feel like we're a good fit I'll prepare a buyer broker agreement and ask them to sign it. I also don't do buyer broker agreements for over 2 weeks, I don't expect them to buy so quickly, but I'm busy and if I'm not enjoying working with a particular client I see no reason to continue and at the same time I fell it's up to me to either earn my client's confidence or I don't deserve their business. If they ask about rebating commission my answer is simple, it's No I won't. If they tell me there are agents that will, I smile and say that I know this and that there's always been agents willing to do this and without fail these are the least experienced, worst agents working and they have nothing else to offer but to buy their clients. That when I come across agents like this I eat their lunch in negotiations. Then I ask them to consider this, "If an agent is so desperate their willing to give away their income just to have you as a client, how hard do you think they'll fight to get you the best possible terms and price?" Then I simply shut up and wait for a answer. If they say they still want a break, I simply say, I understand band their welcome to leave and that I wish them the best of luck and I move on.
If you don't want to share your commission (and you shouldn't) then be firm, and don't wait till you've worked with them for a while before having the conversation. If they pull this at the time they decide to make an offer, tell them that you've already explained how you work and that you don't share your commission and that if they do decide to purchase a home you've shown them that you're prepared to enforce your contract. I've honestly never had this happen and believe it's because I take the time up front to address how I work and get paid and show them throughout the process that I know more about real estate than they do and more than 75% of all Realtors working do and that working with me is in their best interest.
Best of Luck to you.
This has happened to me once. I had a client, a small investor who had chose to work with me three times before with great success. I thought we had a mutually beneficial relationship built on trust and respect.
Upon opening a fourth escrow the client asked me for a "CASH REBATE" after closing.
When I informed him I would not/could not do that, he was very angry. Once we closed I gave him his closing gift and informed him that he had compromised the agent client relationship, and I would not be able to work with him again.
He later bought another duplex within a few months and he did in fact use another agent. No one has the right to ask us to reduce our commision. Giving a client a "CREDIT" through escorw is up to us, no one should be asking us to discount ourselves!
If someone ever asked me to reduce my commission upfront, I would kindly explain to them, I do not discount my commission, just as I do not discount the level of service I will provide them.
Best of success to you!
Kawain Payne, REaltor
If your client isn't receptive to this reasoning, WALK AWAY. This is a double whammy. These people seem not to value you. As a result, you can count on MANY more problems along the way. In addition you would be setting the expectation that you will accept unreasonable requests. And all of this for %25 of normal compensation!
I get the request for me to give buyers a "kick-back" every now and again, and usually when I explain that the likelihood is great that I'll save them thousands of dollars on the price & terms of their purchase, they understand that I'm worth what the SELLER is paying.
I sometimes wonder if they ask the other professionals that they work with, to share some of the money they've been paid....
This seems to be showing up more and more, everyone is looking for a deal and the client typically does not understand how we as Realtors are paid. One client asked me to contribute and eventually I had to breakdown the commission to show that if I was to contribute the amount they wanted me to that I would actually have to write a check to them. These were clients from the East coast and they did not understand that if I was able to negotiate the sales price down they would save more and pay less in property taxes. They did not come from a state that had a Proposition 13 to regulate their taxes.
Once this was laid out in front of them they removed their request and let me negotiate on their behalf.
Some people just want to feel they get the best deal and they really don't care if you survive or not. These people need to be let go and if all Realtors did the same they would get the message. The problem is there are Realtors out there that give up their commission very easily and without any fight. The Realtor needs the sale more than the clients need the house
For these "clients" you currently have I would suggest being up front and letting them know you can't do this as you are a professional and this is how you earn your living. If they persist you could offer to refer them to another agent that may be more open to their request (I'm sure you know someone) and get a referral fee from that agent. You could ask them if they would ask their surgeon the same thing while they are on the table? I haven't done that yet but would love to. I have said, look, I buy houses several times a year and you may do this once every 7 years on average, let me do my job and get paid for it.
The decision is yours and I wish you good luck, they do not sound like good clients and one last thought. IF you were to reduce your earned commission and they told all the people they referred to you guess what, you will be in the same position soon. Jerks often have other jerks as friends, or something like that.
Good luck with your decision,
Brian Wilson, Relator
Personally speaking - I would go over the buyers agency form and explain to the client upfront you are paid based on your expertise and the work involvement. Your commission is well deserved.
Those type of clients have been "shopping" and when they approach you at a later date .... And ask for a portion of the commission , I have replied in the past with an offer of a purchase of their home warranty . This gives them a comfort level and usually works... If the client doesn't agree - then let them know you will need to teminate your agency agreement because you simply cannot work under those conditions. Be polite and firm.
Seek out other clients and I concur with the other statements made as well. Remember you are the expert and you deserve the commision.
You are entitled to a standard commission for your expertise, knowledge & work. It's a fair game. It's my opinion you never throw in the towel but rather educate the client.
My favorite line is "compared to what?" - Who are you comparing me too? Do you really want an agent who is willing to compramise one of their largest purchases in life? Do you think if an issue arises that the agent "willing" to take a major discount will put you first in line when there needs to be a problem solved?
In my line of work it's easy - They throw a sweatshop lender in front of my face - I reply with complaint boards responses & BBB rating.
In your case - they might pick a weekend realtor who has completed 2 transaction if they are lucky. Ask the buyer - Is this what you want?
Another angle...I ask the client what they do for a living. I ask them - Is it fair to ask that you work for %75 less despite doing the same work? OK - You earn $100,000 per year - Are you willing to continue for $25,000 a year? Does that seem fair?
Continue the customer service - and continue to do what you do best - Sometimes there are bad apples in the bunch. Sometimes you have to cut your losses and ask the client direct in a postive manner. But never...never be held hostage.
Keep it alive with grace & always take the high road with your chin up.
So how about that Pineapple Piere? I think it about time you take a drink on the Castle & Cooke Kool Aid. I bet it will help your business grow? Retrack - I guarantee it will help your business grow.
Good luck on this transaction.
Castle & Cooke Mortgage
Cell: (949) 212-4578
There is no need for that in business or personal life.
Work hard. Be nice.
Let them go. You will find that you have done yourself a favor and will have better confidence to go onto the next client.
Working more on referals from previous clients or other agents...will eliminate some of those who think you are just an order taker...and we know that is so NOT the case!!
I don't use exclusive contracts to gain loyalty.. I educate clients. But having done that for years, I still get a lot who ask for a huge payback from my commission. .. and worse, they want to have dinners or lunches on your time and wait for you to foot the bill! (Sometimes this is a cultural exoectation!)
And I site examples of being "good" first than just Nice..
some friends and other clients who invested out of state and placed a huge premium on being Treated out to fancy restaurants being give gifts (foo foo gifts of comfort foods or whatever)..and being allowed to stay in the realtor;'s home out of town.. only to be sold a very high priced home without being given gooid market analysis and what their future needs would be if they cant proceed with their original intended use as I had doen for them-- even if they don't buy I always advice them. That's my goodwill.
I just summoned enough courage to remind them they are getting the best service and experience from me as a long time agent, with experience in loans, etc .. and I can be reached past 9 pm too-- I do pickup calls anytime if I am able, and send offers after late showings however late it gets.
and to please have a hearty meal before meetuing with me as I show a lot of homes to maximize use of our time.
We don't need "users" as clients. Cut them loose and go work with clients who respect and appreciate what you do. You cannot win in that situation.
Respect between you as RealtorÂ® and your client is a two-way street, and both sides should respect one another. If your client doesn't respect you and your professional service, it's probably OK to discontinue that relationship.
If the discussion does end favorably at this point, you may wish to explain your "procuring cause" rights and related arbitration procedure. Then file one with your local board to get your fee. You can also put your name in with the seller's broker as having brought that buyer as a place holder for board action.
Did you sign a BBE with the Client? If so, I would review it with them. You can also use a tool an old time Broker-friend showed me years ago. Use 6 one-dollar bills representing 6%. Take 3 of them away and that goes to the Listing Broker. The other 3 goes to your Broker, take 1 away for the Broker's cut, 1 for Taxes, and the 1 remaining dollar goes to you for everything you need to live on, Food, Housing, Car, Gasoline to drive them around, clothes, Health Insurance, etc. Ususally people "get it".
As for them asking for 75% of your commission - I would not.
As for them buying the house you showed them if you don't give them your commission, if you did everything right, you will have a "Procuring Cause" action and although it will take you a while to get through the process, you will get your commission even if they use another agent who will likely be pissed-off when they have to give their commission back. I would explain to the Buyer about Procuring Cause and clearly explain the new selling agent will not be entitled to the commission if you showed the house first. Keep a record of every house you showed them including time, date, etc. If they termintae you, per your BBE, send them a list via US Mail of every property you showed them to protect yourself.
As you know, in CA it is legal to provide any part of your commission to a principal (excpt in short sales) as long as it is clearly shown on the HUD.
Another long time 80 year old Realtor in Texas once told me that in her 55 years as a Realtor, she has never given a dime of her commission to anyone, nor has she even given a closing gift. All of her past clients come back to her over and over again because they respect her.
Best of luck !
Broker / Owner
DRE # 01398570