Some of us investors also use our own TCs--whether or not we opt to work with agents--and the fee is often paid out of the proceeds of the transaction. In other words, this cost ultimately gets passed onto the buyer. Assuming you already know how to price this and other costs into your offer price, then it really shouldn't matter who actually pays it, because it won't come out of your profit.
Best of Luck
I just closed escrow on a short sale and did all the paperwork myself. Some agents do you use a transaction coordinator but they should pay that out of their own pocket or commission. I agree with the other responses below, tell your agent you do not want to pay for it. $250 is on the lower end as well, others charge around $300-$350. If you have any questions please don't hesitate to ask.
At what point did your agent inform you that you would owe $250 for a transaction fee? I've seen them charged but personally don't charge one myself. I feel the commission is our compensation and don't like to see what I consider nickle and dime fees added on top of that. If you have a buyer agency agreement that outlines you are responsible for this fee then you owe it. If he/she is just bringing this uup arbitrarily after the fact I think you would have the right to question the charge as you would with any service provider.
"The Transaction Coordinator (TC) is a person whose job is to make sure that all of the paperwork in the transaction has been completed completely and correctly."
In my neck of the woods, this is what we (real estate agents) are paid for.
In Las Vegas (and apparently other places as well) there is a broker's fee, apparently charged by the company for such things as storage fees. To my mind, that's just an add on charge to increase profit.
I know times are tough but really???
I guess things become customary and nobody thinks to question it because it just seems as if everybody is doing it. I don't blame the agents in this case because from what I see from your posts its not adding to your bottom line but I wonder why certain things become accepted, perhaps even required, in various parts of the country, yet not others. I have seriously never heard of a transaction coordinator.
Of course in my part of NJ RE attorneys are not required yet almost always recommended and used so I guess we all have our stuff.
My problem with this is the timing. If you are informed early the process and sign for it with any buyers agency agreement, fine. If it's a surprise sprung on you at the last minute, I'd personally say no. Part of my job as a buyerâ€™s agent is to minimize surprises, anticipate issues which will come up in the process and prepare my client. There are often unanticipated events and we have to roll with them, but if this is a normal and customary practice with this agent or agency, it should be disclosed to you up front.
You did not mention if you were a Seller or a Buyer. Below is an excerpt taken from the California Association of REALTORS website in a legal article regarding RESPA rules that may be helpful.
Q 7. How can a REALTORÂ® ensure that his or her charges do not constitute "up-charges" or "unreasonable fees"?
A HUD's Statement of Policy does not provide specific guidance for differentiating lawful fees from unlawful fees. A REALTORÂ® who intends to charge a fee which is separate from his or her base compensation for professional services, and who wishes to attempt compliance with HUD's Statement of Policy, should be prepared to show that the fee charged:
. was for actual, necessary, and distinct products delivered or services performed;
. was not for products already delivered or services already performed;
. was disclosed to the consumer who purchased the products or services; and
. is commensurate with the reasonable value of the products delivered or services performed.
Since there is no way to exactly predict how HUD's Statement of Policy will impact REALTORSÂ®, the most conservative option is simply not to charge administrative fees, transaction fees, or other such fees, and instead to charge consumers a single amount or rate of commission, which can be expressed as a flat fee, percentage, or combination of the two.
My personal opinion is the the REALTOR should pay this fee if they have too many transactions to handle the file themselves as the cost of doing increased business. Many agents do their own transaction coordinating and often it becomes necessary to get assistance.
As the others suggested, have a discussion with your agent as it is a negotiable item.
Marcie Sands, REALTOR
Simply The Best Real Estate Company, Inc.
I never charge my Buyers for a TC. This is an option that Agents could use if they are not willing, do not understand the process or don't have the time to do the work themselves. I would negotiate this with your Agent.
This is not an unusual fee and the cost quoted by your broker is reasonable. I have seen them ranging up to $450. The Transaction Coordinator (TC) is a person whose job is to make sure that all of the paperwork in the transaction has been completed completely and correctly. This job has evolved over the years and has become a necessity in most cases. Most of the insurance companies that insure the brokers against Errors and Omissions recommend that the agents use a TC.
The TC also protects the buyer and seller to make sure all of the disclosures have been made. Of course if there have been errors the injured party could go to arbitration/mediation or sue. But rather than go through that trying process it is better to make sure that all of the paperwork has been completed correctly the first time.
This fee is negotiable but it is usually paid by the buyer for their side of the transaction and the seller on their side. If the TC handled both the buyer and seller's paperwork there could be a conflict of interest and it should be disclosed to both the buyer and seller if that is the case.
Many Agents do use Transaction Coordinators in order to keep vital paperwork handled efficiently when they are working with multiple listings. In the case of multiple listings, I(as the Agent) usually pay for this service.
Since I really don't know the particulars of your situation, I would say it is something to negotiate and discuss with your Agent.
It is not unheard of for an agent to utilize a transaction coordinator to keep all the paper work on track by the parties involved with the deal. However, like all things, this is a negotiated item. Certainly, I have seen higher transaction fees ($550) so this was certainly seems reasonable for the service.