It IS normal for a realtor to discuss fees as part of the contract - whether listing or buyer representation. Fees can be paid in many different ways - whether a percentage of sale, hourly, per property, by the mile and so on. Some sellers offer fees to the listing agent that may be less than what may be often expected. Sometimes more. In turn, the listing agent may pass that negotiated factor on to the buying agent who then explains it to you. Each circumstance is different. Texas does not have "standard" fees.
Consider the investment of time and effort your representative has made on your behalf. Have they provided a valuable service? What other negotiated factors did they find in your favor to save you money in the final agreed upon sale? Are they assisting you with lending, home inspection, warranties, utilities, moving, communicating on your behalf with other services? What marketing materials have they provided with this property and any other to give you the confidence of making a wise decision. .05% may not be so much when you realize that we are only paid at close of sale -- everything beforehand has been free: the hours involved in researching, the time communicating with other people involved in the transaction, the gas spent on driving from one property to another, et cetera.
I hope enlightening you will provide a confident decision. And congratulations on your purchase.
ABR, ASP, CLHMS, CRS, ePRO, GRI, SRS
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Susie Kay, RealtorÂ®
GRI, CHMS, SFR
United Real Estate
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Dallas, TX 78240
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Don Groff | REALTORÂ® & Mortgage Broker
Austin Real Estate Pros & 360 Lending Group
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As so many have aptly described, what the buyer may be required to pay does depend on the property they select. As Don explained, the compensation to the BUYERS agent is established by the SELLER and the sellers agent (listing agent)...that can and has been in select instances ONE WHOLE DOLLAR. I do not think any BUYER expects their agent to work for ONE WHOLE DOLLAR.
Your agent has established their minimal compensation to be 2.55%. (your numbers)
All real estate professional fees are negotiable. .05% is an odd value? is this a typo or. Is there more to be told?
How much do you want the house?
Here's what very likely happened. First, the commission is negotiated between the seller and the listing agent. I'm guessing in this case the agreed-upon commission was 5%. I'm also guessing that the listing agreement specified that the commission would be divided 50/50 between the listing agent and the buyer's agent. That's fairly typical, though it could have been structured, let's say, 2% to the listing agent and 3% to the buyer's agent. In this case, it wasn't.
So a buyer's agent is only going to receive a 2-1/2% commission.
Now we get to you, your agent, and your buyer's agreement. I'm guessing that you signed a buyer's agreement stating that your agent would receive a 3% commission. That's fairly typical--though, of course, all commissions are negotiable. And since a lot of commissions are 6% total, a buyer's agreement promising half that, or 3%, to the buyer's agent usually works out fine.
Problem is, I'm assuming, that the listing agreement calls for a 5% commission split 50/50--so 2-1/2% will go to your agent. The buyer's agreement you signed calls for a 3% commission to your agent. You agreed (in the listing agreement) to pay any shortfall so that your agent's total commission would be 3%. And that's probably why you're being asked to pay 1/2% commission.
Check your buyer's agreement to verify (or clarify) my assumptions.
Ethically, as is discussed below, you should have been shown the property. But you should also have been informed that your agent would expect you to pay a portion of the commission. Some buyer's agents, for purposes of goodwill, would forego that additional commission. But if the scenario I've described above is correct, then--technically--you've agreed to make up the difference.
Again, check your buyer's agreement. Then discuss the matter with your agent.
Hope that helps.
Best of luck,
Keller Williams Realty
I have in the past have had buyers rep agreement signed with 3% I made less based on # of reasons especially with short sale or foreclosure I don't charge back the client ... I just move on .
IF your agent aware she was not going be paid standard full commissions should have never shown the property.
Lynn911 Dallas Realtor & Consultant
Multimillion Dollar Sales Producer
http://www.lynn911.com 100's of Dallas homes listed for sale or lease
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