Home Buying in Los Angeles>Question Details

Davidj, Home Buyer in Los Angeles, CA

What is the time period that the procuring clause is in effect? I saw a property with an agent in Los Angeles but I find he lacks the skills

Asked by Davidj, Los Angeles, CA Mon Nov 1, 2010

and experience I am looking for. He's not detail-oriented and I find I know more about the property than he does... e.g, HOA fees, amenities, who the seller is. We put in an offer and he made errors on the purchase agreement that I had to point out t him. We didn't get the place, and I feel it was his lack of experience and negotiating skills. How long do I have to wait before I can make another offer on the same place with another agent?

Help the community by answering this question:

Answers

13
Hello David,
Did you sign a Buyer Broker Agreement? If not, then you are free to work with whoever you wish. As an agent, you hope that the buyer you are working with is loyal and dedicated as we are to them, but most agents will tell their clients, "if you are unhappy with my service, you are free to go elsewhere"

The only hitch may be that you have made offers with this agent. If you now want another agent to make an offer on a property that you already made an offer on with this agent.. there could be some friction and maybe a commission dispute, if you wrote an offer with someone else and ended up getting the property. Originally, this agent was the procurring cause, meaning, he was the first to show this property to you and thus, if you purchase it, he should be the one getting paid....

What I would recommend is this... Communicate with this agent and tell them of your displeasure. Also, put it in writing and get their response. If you no longer wish to work with them, tell them and give them the reason why. If you hire another agent, inform them of this situation and most agents will contact this agent and explain that they are now representing you and will be making an offer on such and such property from this point forward... Many agents like myself will offer and sign a referral agreement with your previous agent in order to make things less complicated.

I would be happy to do this and to assist you moving forward.
Sincerely,
Richard "RJ" Kas (SFR, SRES)
"Representing the finest properties from Los Angeles worldwide"
KAS Properties - Coldwell Banker Previews International - Beverly Hills East
9388 Santa Monica Blvd, Beverly Hills, CA 90210
310.859-5334 office - 310.488.9826 mobile - 310-273-0670 fax ATT: RJ
RichardKas@gmail.com - http://www.RJforLA.com - DRE: 01352771
Sellers Buyers Investors Leasing Consulting
0 votes Thank Flag Link Tue Nov 2, 2010
Hi David;
I think you are mixing apples and oranges. There are really two questions here: can I get a new agent, and who gets paid for writing the offer (procuring cause).
Procuring Cause is a term used in determining to whom the seller will pay a commission based on the MLS offering to a sub-agent (the person who brings the offer). It has absolutely nothing to do with you, as a buyer, because you are not a party to the MLS offering, nor to the commission.
The only time you need be concerned with who, or how, an agent is being paid in the transaction, is if you have an exclusive buyer representation agreement, wherein it states that you, not the seller, will be paying the commission.
You have EVERY RIGHT to choose a new agent for yourself, especially if the standard of representation you are receiving is not up to the standards specified i your agency agreement, including, but not limited to, diligence and knowledgeably on the part of your (existing) agent.
When you hire a new agent, make them aware of what has transpired, and be sure they speak with all parties (previous agent and seller's agent) on your behalf, to notify them of the change in representation. I find it often helps to have my buyers write a brief email or letter stating that they are no longer working with broker A, because he lacks the skill, knowledge, etc. to put the transaction together on your behalf, and that, due to your strong desire to acquire the property, you will be working with broker B, who you believe will work more effectively on your behalf.
This will give the new agent the negotiating strength he/ she needs, and makes it clear that you are quite serious in your endeavors, and not someone flighty whom the seller should worry about, if they get into an escrow with you.
As for how long to wait, as in every real estate transaction, TIME IS OF THE ESSENCE. Don't wait. The primary goal here is acquiring the property for you. Let the compensation chips fall where they may. The agents can resolve that down the line.
Best of luck,
Deborah Bremner
The Bremner Group at Coldwell Banker
REALTOR, 00588885, ABR, CDPE, eAgent, CSP, SFR, HRC, CRE
(O) 310-571-1364 DIRECT
(D) 818.564.6591
http://www.thebremnergroup.com/news/
0 votes Thank Flag Link Tue Nov 2, 2010
There is no reason to offer any compensation to the original buyer agent. He failed. He shouldn't get paid. That's like taking your car in to get fixed & the 1st mechanic busts your break line, so you take the car to another mechanic who fixes the break line. Would you then, in turn, go back to the 1st mechanic & say, here's $50 for your efforts, thank you for your great service? No.

Or a real estate analogy. Agent #1 lists a property for sale & after 6mos the listing expires. Agent #2 comes in & sells it. Should the first agent who failed be entitled to some of Agent #2's compensation. No.
0 votes Thank Flag Link Tue Nov 2, 2010
Procuring Cause is the relationship between (in your case) a buyer & a buyer agent which without out break in continuity leads to a sale, which compensation to the buyer agent is derived. (not exact definition, but good enough from my memory at 4am)

I have been around the block with procuring cause. Your buyer agent showed you the property, helped you to write an offer, submitted it & it was rejected. That's a break in continuity for this property.

If another agent came in to represent you, wrote an offer & it was accepted, there is no break as it was successful.

If I were now representing you, I actually do have a form I wrote up for situations like this, that I had approved by attorneys for a well known real estate brokerage. Whether it's been 2 days or 2wks since your last offer was rejected, I would still make the previous buyer agent & his brokerage sign it to release me of any future liability should he get an itch to file a claim against me later on down the road.

EmilyKnell1@yahoo.com
562-430-3053 cell
Realtor Since 1996
0 votes Thank Flag Link Tue Nov 2, 2010
So did the property come back on the market or something? I believe you only have to worry about procuring cause if it's the same property or if it's a property he showed you. If it's a similar but different property, you don't have to worry about procuring cause at all. If you are "stuck" with him, I would talk to his office manager/broker-- it's no big deal. Sometimes things don't work out and we are all professionals out here. He'll be bummed, but he'll get over it. Good luck! Please update us and let us know how it worked out.
0 votes Thank Flag Link Tue Nov 2, 2010
Hi David,
I found an older article about Procuring Clause that I think you will find interesting and answer your question. The broker can pursue legal action to receive compensation but that does not mean he or she will win.
http://findarticles.com/p/articles/mi_m3601/is_42_47/ai_7602…

If you have a exclusive buyer broker agreement with the agent you can request a letter of cancellation if you are not happy with the agent. Hopefully this agent would be happy to accept a referral fee from the new agent and move on.

I would be happy to answer any other real estate questions and assist you in searching for a property. I have a Masters of Architecture degree and am extremely thorough when working with my clients watching over the process every step of the way. Please check out my website http://www.karennumme.com 323.804.2008 and search the MLS like a professional realtor.
Good Luck,
Karen
Web Reference: http://www.karennumme.com
0 votes Thank Flag Link Tue Nov 2, 2010
Hi David,

My advice would be to find an agent that you feel comfortable with, and have him/her call your original agent to work out an amicable split of the commission. The way it's often done is like this: Your new agent, being the agent who would essentially be doing all of the work from this point on (negotiating the contract and handling the escrow), would recieve the buyer-side commission, but would offer your first agent a referral fee. Your first agent might have his ego bruised a little, but he'll realize that he's already lost you as a client, so getting a referral fee and not having to do the majority of the work required to effectively close the escrow, is better than just having you move on to buy another home with another agent (in which case he would receive nothing for his work up until this point).
Feel free to give me a call if you have any further questions -
Best,
Brad Reed
Brad Reed & Ron Roth, Realtors
323-449-7416
0 votes Thank Flag Link Mon Nov 1, 2010
David, you have another option. If you are obligated, legal or otherwise, to the agent who has done you the great service of leading you to a property you want - respect that relationship and still get your property. I'm a broker who is also a professional negotiator. I buy properties throughout the state for clients by using local agents to do the paperwork while I supervise the process and set the terms of sale. There are probably other brokers like me in your area who will respect your relationship with your broker, which is probably a legal obligation, and help you close the deal with only minimal additional cost.
0 votes Thank Flag Link Mon Nov 1, 2010
David, Did you sign an agreement with the agent for representation? If so, you should have received a copy. I'd take a look at it. It should state the time frame. If you feel trapped, just remember you can go with another brokerage at any time. Homes come on and of the marekt daily. It may take a little more time, but you'll find one that is right for you if this opportunity falls through.

Lets talk if you have more questions?
0 votes Thank Flag Link Mon Nov 1, 2010
Hi I'm the original poster. I don't feel he's done anything wrong per se, but I don't have the confidence in him. He doesn't have the knowledge or experience or interest in getting me the information I need to make a good decision. So I certainly don't want to talk to him about my concerns. It just doesn't make sense to me. I'm trying to find the legal/financial ramifications of getting another real estate agent to put in another offer on the place I like.
0 votes Thank Flag Link Mon Nov 1, 2010
I agree you should talk to the Broker. It will be important to be specific about what the agent did wrong and maybe there is another agent who is more compatible.
0 votes Thank Flag Link Mon Nov 1, 2010
HI David.....to the best of my knowledge, there is no set time frame regarding "procuring cause", or when it might expire.

I think you have 2 viable options:

1. Speak to the agent's Broker/Manager. Explain your situation, and why you are dissatisfied. Ask to have another agent assigned to you. This will avoid any "procuring" cause issues, and allow you to proceed and make another offer right away, if you choose to do so.

2. If you really want to make a change from the company,as well........... find a new agent in another company , and explain what has taken place. That agent can reach out to the other agent and work it out between them. In the meantime your needs can be met, and you can move forward with a new offer on the home.

No one owns a buyer - if you are unhappy, you are certainly free to move on. Buying a home is too big of a transaction to work with someone you don't have confidence in.

I assume you don't have a signed agreement with the first agent, otherwise, it might spell out what the time frame is in a case like this.

Best wishes to you..........
Debbie Rose
Prudential NJ Properties
0 votes Thank Flag Link Mon Nov 1, 2010
Procuring cause is the correct name. It is between brokers only. Your original broker would have rights to some or all of the commission, and this would normally be arbitrated by the board of realtors. As long as you hadn't signed anything with the original broker, you should have limited liability, but you should ask your current broker to agree to amicably mediate with the original.

If you have any questions, feel free to call or email.

Richard Schulman
#1 Listing and Selling Agent
Keller Williams Realty
310-482-0173
schulmanrd@yahoo.com
http://www.RichardSchulman.com
0 votes Thank Flag Link Mon Nov 1, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer