The 25k condo was an example however feel free to check our MLS and you will see I listed a condo several months ago that was a short sale and I did indeed negotiate the commission for handling it. I didn't seek out the listing - the seller sought me out due to my short sale skills. The selling price was 27k.
You will also see over the last year I represented buyers that purchased condo's under 50k which still doesn't give me thousands of dollars on a single transaction. I personally prefer handling single family homes but will help most anyone requesting my assistance which is why I took on the 27k short sale listing.
You are 100% correct about the 25k listings now being non existent which is truly a wonderful thing for homeowners as well as real estate agents and if we are all fortunate we will never again experience what we went thru over the past several years.
Again, I personally hate transaction fees and wish they didn't exist but the buyer that posted this question obviously worked with an agent that gets charged the fee by their broker. Bottom line is the fee should have been disclosed up front and now the buyer has been put in a bad situation that could easily have been avoided.
My point to you was real estate agents do NOT make thousands of dollars on every transaction. The general public sometimes thinks we do but this is simply not true. In reality anyone that has been in this business any length of time will have stories about buyers that looked at numerous homes and never bought so sometimes we have invested a great deal of our time showing homes and at the end didn't make a nickel.
Thumbs up Pacita - you gave an excellent answer!
Some agencies do charge for a transaction fee --- but most of the agents I know absorb that cost and don't pass that on to their clients.
If this fee is gnawing, grating at you, and it is damaging your relationship with your agent, make him aware of your discomfort and dissatisfaction. Perhaps he will absorb that cost to keep peace, and to keep you as a client. Otherwise, this relationship is damaged because you now have a certain distrust in how this brokerage operates.
Good luck to you.
This fee has not changed in 7 years. Consider how much everything else has increased since that time.
In regards to "broker transaction fees", these fees are designed to offset the cost to the broker for added paperwork and document storage in connection with governmental regulations, including those dealing with flood zones, radon gas, and lead-based paint.
Florida requires brokers to keep records of all residential transactions for a minimum of five years. These fees are totally legal, very common, and have been "accepted and understood" by about 98% of consumers (you can verify this percentage by going to NAR's website and researching this for yourself). Good luck!
Therese A. Clapp, Licensed Florida RealtorÂ® MBA
GRI, ABR, SFR, AHWD, REPM
Century 21 Sunbelt Realty, Inc.
725 Cape Coral Pkwy W
Cape Coral, FL 33914
Main C21 Office: 239-542-8611
They are equivalent to all of the junk fees that used to be attached to mortgages by the broker and by the title company. I have **never** paid this type of fee anywhere else in the country!
I just bought a home in the Cape. The fee was never disclosed to me, either, until I received a contract for me to sign to make an offer on a home. I REFUSED TO PAY IT!
I bought a $350K home, the $10,500 commission is enough to cover any fees. There is nothing that is "transaction based" that requires a "per contract" fee - like doc stamps, etc.
THIS IS ALL A NORMAL COST OF DOING BUSINESS - OVERHEAD - THAT THE OWNING BROKER AND AGENT SHOULD PAY FOR OUT OF THEIR COMMISSIONS.
I am a Finance Professional, with an MBA. I am a former VP at a Finance Company, and a professional investor who has purchased many, many homes over a 30+ year period.
Refuse to pay these fees. If they are presented late in the game, - at the offer stage - strike it out. Refuse to sign an offer with the fee included. Then complain to the owning broker - not just your agent.
Or go elsewhere, to someone who does not charge junk fees! You have the power when you have teh cash - you are the customer shopping for a service.
Successful agents/brokers should not need to add in meaningless "junk fees" to make a reasonable profit!
"Stapling fee", "Cell phone fee", "Clothing fee", "Tire wear fee", "gasoline Surcharge." etc. All just normal business overhead.
Find an agent that works for a broker with none of those required fees....we are much happier agents to work with.
In Florida this is becoming a very common fee but it should have been disclosed somewhere in your contract documents. My recommendation is to check your documents very closely. Many agencies use a "contract to closing" document that lists all of the commonly known expenses associated with the buyer's side of the transaction.
Ask your agent to show you where/when this "broker fee" was disclosed to you. If you don't get information that you feel is acceptable, the next consideration is deciding whether or not you are willing to pay the additional $295.
I agree, it does feel like a "cheap shot" when brokers surprise customers with what many feel are "junk fees."
Stand your ground but don't put your transaction at risk over such a small amount but it's the principle of the thing especially when there was no notification or awareness.
If you would like to work with me, I do not charge this fee to my buyers or sellers.
My broker charges it, but I pay this fee on behalf of my clients.
Your agent should have disclosed this information to you before starting to look for properties.
I am always here and happy to help
There are companies that do not charge these fees. My husband and I (both realtors) actually switched to our current Broker 2 years ago and largely the reason we picked this Broker to move to was because the Broker/Transaction fees are not charged. We personally had a hard time justifying this fee to our customers while we were at the old Brokerage.
I personally pay it on their behalf , I believe that if there is going to be a fee, it should be disclosed before.
Vivian I Hyzdu
Fort Myers-Cape Coral Realtor.
But to avoid any confusion it might be worth your wild to ask up front in the very beginning before you have a realtor show you house number 1 if you will be charged anything from that their brokerage.
Vicki Biehl, Realtor
Century 21 Aztec & Associates
â€œNo Transaction Feesâ€
In an earlier comment, Carlos stated that the written disclosure was made when preparing an offer. So it appears that it was disclosed. The issue appears to be the clients dissatisfaction with the agent not verbally discussing their company's fee before going to make an offer.
Personally, I don't charge this fee.
What is shocking is i haven't read any replies with regards to DISCLOSURE! The fee is negligent the question is DISCLOSURE. If the agent did not Previously DISCLOSE this fee; first, that is unethical and unprofessional second, you would not be required to pay this fee , because of NO DISCLOSURE (your buyers agent would have to eat it not matter what), 3. In 2009 U.S. District Court came down hard on these type of fees ruling that so called â€œadd-onâ€ fees violated federal law. And the real Kicker is:
HUD is now looking at the legality of these fees, especially in view of the new RESPA regulations which became effective January 1, 2010. The revised HUD-1 has line items where the commission charges can be listed. HUD has taken the position that if the total commissions exceed those quoted on the realtorâ€™s listing agreement, then HUD would have the power to review the extra charges. If little or no services are performed to support the â€œadd-onâ€ fees then HUD would treat the additional fees as a RESPA violation.
Hope this helps...view more of my expert advise at http://blog.houseguy.org/
Like all said here, the fee is negotiable. It is automatically included and if you don't complain, then there it is!
Lenders can give you a credit to offset this fee and many other fees. If you thing the agent has done a good job so far, stick with them and find a lender with low enough rates to give you a lender credit without jacking up the rate.
It is all relative.....I can go out and hire a contractor right now for lowest cost.....and the job can be botched and horrible. Not worth it right? Cleaning up the mess will double or triple your cost. Well....considering a home purchase is one of the largest transactions an individual makes throughout their lives....what is 295.00? I would rather pay someone an extra 295.00 on a 1k job if I knew they were good. 295.00 on a purchase from 100k to 100 million.....come on....speaks for itself.
If someone provides no value....different story. You provide me no value.....no pay. Thanks for playing.
As a Century 21 Agent we are required to charge this or it comes out of our pocket. Each office has a different policy and commission structure. Depending on the price range of home I am selling, this can be easily worked into my cost as a service to the customer.
We sometimes offer this discount for the opportunity to help a consumer reach their goals. This should always be your agents #1 priority. Helping people buy and sell a home for a specific purpose. As well as, giving them the best experience you can.
Yes, this is a fee that should be disclosed up front to all home buyers and sellers. It is considered a processing fee in our company. It typically, has nothing to do with the agent you are directly working with.
I have seen other companies charge much more than this fee.
I truly hope my answer helped with this discussion. Have a Beautiful Day!
One reason these are "junk fees" is that there is nothing specific to this transaction - this purchase offer - that raises the cost to the Agent. Instead, it covers a base cost - fixed, overhead - cost of doing business.
With a Mortgage Loan, for example, you need to "pull" a credit bureau report for each application, so there is an incremental $15 charge, etc. Those types of fees at least make more sense on a "per contract" basis. They are a direct pass-through of a transaction based cost (although they could still be covered out of commission on a certain size loan or higher.)
This fee is not "volume based" in any sense. If you close 1 deal, you charge $295. If you close 10 deals, you charge $2,950 to cover **the same base charges**?? If you close 100 deals, you charge $29,500 - but the fixed overhead charges remain the same?
Where is the logic in covering "overhead" in that charging scheme?
I *can** understand a similar "pass through" of cost on lower price property, as discussed below. A 3% commission on a $5k lot amounts to $150. If you have a client that wants to look at certain properties, I could see disclosing - day 1 - that you would need to add a "fee" to cover your costs on similar properties.
And as someone mentioned below, you always have the option of not working on a certain type of business if you can't make a go of it! That would force commissions to be more rational in some areas of the market. It would be great to see certain types of sales (auction.com anyone?) be required to pay a **reasonable* commission to the agent if the industry boycotted the low end jobs. ;>)
As you indicated it is a Broker fee being charged.
The broker is providing office space, forms, desk, computers, phone, internet, web sites, print outs for the Agent or Realtor to use.
While it should have been disclosed, it is mute now in the event you have signed the contract.
Check if you have a Buyer Broker agreement as that makes it binding on your end.
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If you are buying a property where the agent is making a decent commission request that they pay the fee on your behalf and remind them it should have been disclosed to you up front. If they refuse to do so then you must decide if you want to lose the home you chose over $295. If you choose to lose the home and find another real estate agent discuss how they handle fees such as this when you first speak with them so you won't have any future surprises.
You stated that this agent has already been working for you, showing you homes. I would recommend discussing the fact that you don't believe that you should be charged this fee. They may decide to pay their broker's fee out of their commision. If you're happy with the work your agent is doing, see if you can work it out.
Best of luck,