Does anyone have the cliffs notes for this topic? I see there are 85 posts on here and I would like to get the general consensus of the group.

Hello Heather, I do understand what you are saying, however being a Realtor and representing the buyer does take a lot more work, finding the home is just the start. There is the inspections, the septics, the appraisals, the attorneys, the mortgage companies and of course the sellers and the negotiations. Any one of these items can fall apart at a moments notice. This is when a Realtor can use their skill and judgement to keep it together. Please also remember that our commissions are split with our company, so we really are not making exorbitant amounts of money, however we do earn and work hard for our clients. I hope this has helped you in your decisions. I wish you the best of luck.

Jared (over here on this thread showing us all how much he doesn't know about this aspect of real estate):
If someone refuses a payout, and the other party didn't sign on for arbiration, then I would think that it is a civil issue. One of the main reasons I dislike the NAR is their opinion of mandatory bining arbitration. (I'm a strict constructionist Libertarian and belive the Constitution is important.)


JR: You aren't an agent, so why does it concern you?

Jared: If the offer is only to Realtors, the Laurie has no icentive to show the home (since she isn't a realtor bound by the elusive code of ethics)

JR: Unlike yourself who is not bound by any code of ethics?

Jared: unless she arranges with the listing agent ahead of time to get paid. She could also just get the buyer to cough up 3% which she could insist is negotiated off the price of the home. When your not bound by mandatory binding arbitration all kinds of easy solutions present themselves. My favorite is the good ole' fair market.

JR: All Laurie has to do is call an ask for a cobroke, which is how things worked before the MLS. For your information, no one is "bound" to arbitration. Members have the option of using an attorney, but if they do, they cannot arbitrate later.

Edited to reflect Laurie's status, I hope. :)

Laurie I sorry I implied you weren't a "Realtor", I meant that as not being a member of LIBOR you are not bound by their rules of arbitration. And as I've said before, I've been one of the first to argue, when people say that being a Realtor with an ® after their name makes them somehow different, I was the same agent when I wasn't a Realtor® as I am not that I am one because I paid the fee. I'm sorry if you took that as an insult, it wasnt meant to be, and I apologize and will change my post.

Heather-
I am a commercial real estate broker in CO, and I do little residential from time to time, but really don't like it. It is quite a silly game and not a business mined industry in my opinion. That being said, the work is HARDLY over once you find a house. You have really done very little of the work up to this point. Also, you do not have a license. That is really like saying, "I did my own taxes this year, so should I call my account and ask for some of his salary?" This is how we make our money, remember that. I have given part of my commissions to many people for "referral fees" etc. It is done quite a bit but the reality is we should not have to do so because someone finds a property or uses us instead of another broker. Also, the money made on a commission may seem like a lot to you, but this could be and many times is the onyl paycheck received for several months, especially in this market. All in all I would discuss this with your broker, and if you don't get one, be very careful, there is still a lot to do here

Last line should read: as I'm guessing, JR, you would not, either.

JR, for the record: I am indeed a Realtor, who is being denied access to the mlsli that I pay for (along with the NAR stuff) because of a class that is a new agent orientation that I have procrastinated completing, but have paid for (along with all of the other hours accumulated through mlsli/NAR this year, at ridiculous cost, imo). Somehow I opened up my own can of worms over a short computer class that is designed, I assume, to acquaint me with "ethics" (despite many years with no issues whatsoever- and I mean,NONE). So, arbitration is of no value to me, because it simply has not ever been necessary. That said, completing the class that found you finishing paperwork (as I would have found myself doing) is just one more annoyance that I PAY FOR. Again, though- despite paying, I would have no issue with a real estate agent that dressed up as an octupus in high heels and was NOT a "Realtor" if it benefited a seller and got their house sold, as I'm guessing, JR, you would.

Edit (typos)- that I hesitated to take a new agent orientation class, but am as of this minute, PAID IN FULL to the NAR but am being temporarily "punished" has compelled my thought process to look at alternatives. Cameron, I don't like being a "realtor" when being a real estate agent with ethics will serve consumers just fine. Further, the COE would require agents (if they are TRULY looking out for their clients) to offer payment regardless- or are they exempt from ethics to their sellers in the absence of a capital R? You are simply making my point for me. If one "benefit" of being a Realtor is the ability to arbitrate, I'll pass. 2008 is paid for (as is all continuing ed) but I will be rethinking this between now and the start of 2009. If "ethics" don't create, for a broker, the obligation for payment, as it would irrespective (as a listing agent) from my view, to benefit the seller, you're not bolstering the debate.

If someone refuses a payout, and the other party didn't sign on for arbiration, then I would think that it is a civil issue. One of the main reasons I dislike the NAR is their opinion of mandatory bining arbitration. (I'm a strict constructionist Libertarian and belive the Constitution is important.) If the offer is only to Realtors, the Laurie has no icentive to show the home (since she isn't a realtor bound by the elusive code of ethics) unless she arranges with the listing agent ahead of time to get paid. She could also just get the buyer to cough up 3% which she could insist is negotiated off the price of the home. When your not bound by mandatory binding arbitration all kinds of easy solutions present themselves. My favorite is the good ole' fair market.

Laurie,

It is possible that you missed my point, let me try to rephrase it for you. I have heard a lot talk about requiring payouts for this and that. The reality is that the payout is established through the idea of procuring cause through the rules of the MLS. If you aren't a member of the MLS an agent could be offering a 25% payout, you could bring an offer, and there would be no obligation to pay you.

I found it interesting that you are so concerned about something that you aren't even entitled to. I also find it curious that you are willing to benefit from the work of the Realtor member's work and the money they put in to take care of the database, but aren't willing to pay the fees associated with it. The concept of your entitlement to something for nothing is going to bother a good number of those that do pay to give you your free access.

Was that clearer?

Cameron Piper

Edited: Cameron, I was a Realtor at a time where, weekly, we'd anxiously await the big, fat mls books with black and white exterior photos only- perhaps I haven't provided the duration of my association. I'd be happy to pay a reasonable fee for access (my access, temporarily "limited" by mlsli for a "new agent orientation" class probably a requirement of the NYDOS? I have no idea-is quite annoying). While Long Island is an enigma to me, because even with the big, fat books, we had buyer agency- but the NAR has done none of us any favors- public perception is at an all time low, which I find myself paying dues to "enjoy". Hardly worth my buck.

Laurie,

You realize that without membership in the MLS the unilateral offer of compensation does not apply to you. If an agent chose not to pay, you would have no standing to bring an arbitration for payment of commission under procuring cause. For that matter my response to Deborah's question about the code of ethics, doesn't apply to you either.

Let me get this straight though. You think it is okay to access and use the system but to not pay for it. Essentially you feel that all of the other agents and brokers should pay for the system and data and you should be able to access it at your will. Somehow being an agent gives you that right?

Simply finding a loophole doesn't make it right. Why should you benefit from something that you don't pay for?

Cameron Piper

JR, I got the fair housing done, but no- I discovered that mlsli can be accessed without the requirement of realtor status. That works if one understands the whole ethics aspect- I HATE paying dues to an entity that gives so little back. It's area to area, but my search uncovered a way to be an mls participant without what is a bit of a rip off- the NAR has done more to harm the industry rep than assist, with a spokesperson that makes all of us look like idiots. It pertains to the recent lawsuit, "settled" by the NAR (my interpretation: the DOJ forced change) that permits internet entities to have the same access/rights with the mls that "full service" companies enjoy. The thing is, for those that want to avoid fees for nothing gained, it opens the door to access without the association. Hence, my reason for not caring AT ALL whether or not I was called a "realtor".
If consumers don't care, and get full benefits, I don't care...AT ALL.
Gee- if I take the thing at the home office computer, I don't even get a free breakfast- but maybe the gas savings is worth a home made egg over easy- :)

Laurie, doesn't everyone have to join if one belongs? That's how it is in our office we all have to belong per MLS rules. I also had to do the new agent orientation, even though I had already been an agent. Personally, I didn't think it was too bad, there were 100 people there, I got a free breakfast and I did a lot of paperwork. It also fulfilled 31 /2 hours of continuing ed.

I know there is a way to use the MLS without being a realtor, there's a fee, I think?

I, too do not like any of the Realtor ads. I think the NAR would serve us better by educating the public about what we too--something that these forums prove is how unaware the public is of what our job is, how we work, and what we bring to them.

Right now I'm pretty annoyed because I have already fulfilled my license requirement but I have to take 3 1/2 hours on fair housing before I renew.

Deborah, in NY, a buyers agent can show any property, irrespective of the listing agreement. This isn't an NAR decision, it's a NYDOS decision. It constitutes discrimination to buyers with representation to refuse a showing. That was my "beef"- thank you for clarifying it- which is what compelled the second dilemma, which is to include in the offer a BA FEE- also permissible and, imo, ethical, with Camerons clarification that it not be void without acceptance of the fee. That the seller can refuse it is true, but with a good offer, and an explanation from a listing agent (when explaining their fee) that x amount is designated for the selling agent, you are clear on my question and I appreciate it.
JR, I THINK that I'm "suspended"- I was so disgusted with the hours requirements being spent with inadequate instructors, in addition to the insipid and insulting (to all) Realtor ads, suggesting that ' IT'S A GREAT TIME TO BUY!" that I paid for the 'NEW' (I'M NOT) agent orientation, but was too annoyed to take the class. I'll email you upon my return the info that I discovered re. the ability to use the MLS without being a REALTOR- but the simplest thing to do is bite the bullet. We list all properties in the mlsli without exception through my partner- I just became disgusted with the NAR, despite satisfying the hours and paying the dues.
I wouldn't work with any company that didn't mls properties- but need to bite the simple bullet to get reinstated (or whatever)- with the dues that I've paid, I should have done it while I had time off. Ugh.
We've gotten good response from buyers, so have leaned in that direction, making my reluctance less of a nuisance.

Laurie, I mentioned you weren't a member because you were saying agents didn't tell the sellers about the private listing. I didn't know if you were aware there was a form that had to be filled out and faxed.

I agree consumers don't care if you're a Realtor or not--I wasn't when I started-- but sellers do, because if you're not they're home won't be listed on the MLS and they want that. I believe that is why that one holdout from the city has now joined the MLS group.

While I will give you that there are too many agents out here who are operating as they did before they were Realtors, many of them are doing what they do out of ignorance. Many don't have the faintest idea of what agency law is. Until people who don't understand buyer agency cannot understand why a seller should pay someone who is not acting in their best interest. I believe that is how they put it to their sellers. The fact is, you want to sell your house, I have a buyer. Who cares how it gets split. Do you want to sell or not?

JR, my "suspended" Realtor status is of my own accord- while I paid for the new agent orientation, I didn't take it, and haven't yet submitted the Co. experience that would make me exempt. I really don't care if I'm called a "realtor" or real estate agent- consumers don't care, or ask. It is possible, with a small battle, to access (thank you, DOJ) the MLS without that designation. But, it's easier just to put myself through it. When the instructor of a buyer agency class made clear that he accepts "no less than 3%" to represent a buyer (I viewed this, Deborah, as collusion- what new agent wouldn't view this as a "going rate" at that point) the prospect of more of the same being offered in an ethics class was annoying (yes- I reported the instructor). I sat in the class feeling as though I was in the twilight zone.
Cameron, thank you for acknowledging my point to JR that a buyer can REQUEST THAT THE SELLER MAKE PAYMENT- I'm fully aware that it is subject to the sellers approval. While it isn't ever presented as an aspect that will make or break a deal, it does open the door, and force an explanation from a greedy listing agent as to WHY, when it was explained to a seller that part of the fee would go to the selling agent, it would be sensible to turn away a buyer that has made a viable offer with their buyer's agency fee coming out of the listing fee- which impacted the listing price. As it is done in most places with NO HASSLE.
Cameron, until there is no selling agent fee initiated by listing agents that sellers are expected to pay, having represented buyers pay twice is completely unacceptable.
This seems difficult for some to understand, and I can't for the life of me figure out WHY.

Hi Cameron,
No traps...no pass or fail. Curious to hear how people read and interpret the COE. Thks for your reply.
Deborah

Deborah,

I love case studies. Although I am always leary of a trap being set. I might find out that I don't know everything about everything.

First, the Code of Ethics does not require agents to cooperate unless they intend to list the property in the MLS. As a result of the recent settlement with the DOJ, the NAR has come to some terms over selective opt out idea. If you cooperate, you cooperate with everyone. If you aren't cooperating with everyone, you get to choose on a case by case basis who gets to show the property, but you lose things like the MLS. In MN the private listing is called a one-time showing agreement, interestingly they are usually non-exclusive.

There are many circumstances when it would not be in the seller's best interest to show a property. This is particularly true in the upper bracket. Sleazy ex-husband, expensive house, seller won't sell to a specific person, etc.

It would be a violation of article 16 of the COE to use the terms of the offer to attempt to modify the terms of the listing contract, specifically SOP 16-16. The buyer can ask, but they can't condition the acceptance of their offer on the modification of the listing contract. In other words they can't state in the contrac that this offer is null and void unless the seller/seller's broker pays X% to the buyers agent.

Article 16 does not preclude the buyer from offering an inflated price and asking for money back to cover the cost of the representation that they are liable for under the buyer agency contract. Article 16 also doesn't preclude the two agents from reaching an agreement outside of the written offer, see SOP 3-3.

Did I pass?

Cameron Piper

Laurie: Exactly, JR, although I despise the "exclusive" sign riders on mls'd properties. I see lawsuits in the making (know of one already) from sellers that didn't understand the full impact of an exclusive (no cobroke) listing.

JR: I think you said you hadn't joined the MLSLI yet....There is a form that you have to fill out, have the owner sign and fax to MLS if you have a private exclusive listing. I states that the agent has explained the benefits of being on the MLS and you agree that it will not be on MLS.

The bigger problem to me is with customers I am working with who sees the word "exclusive" and call the listing agent because "it said EXCLUSIVE!". Even when I explain I can show them any listing, sometimes it happens.

Cameron and/or others..

Please comment on the following…………..

Buyer agent has a buyer agency agreement w/ a buyer that defines compensation to be “x”.

Buyer agent and buyer locate Exclusive/Private listing. Buyer agent calls and advises that they represent a buyer, have a buyer agency agreement, and would like to show the property.

Is the Realtor listing agent, according to COE, obligated to make an effort to get the seller to agree to the showing?

When would it not be in the seller’s best interest to show his/her property?

Assume the property was shown and the buyer has an interest. The property needs work. In an effort to conserve cash to afford the needed repairs, the buyer wishes to ask the seller to pay the buyer agent commission. Is this a violation of the Realtor COE?

Comments welcome.

Deborah

Some more fuel for the fire. An agent can cooperate but that does not entitle anyone to compensation. These two words are not interchangable.

Article 3 NAR 2008 Realtors Code of Ethics:

"REALTORS® shall cooperate with other brokers except when cooperation is not in the client’s best interest. The obligation to cooperate does not include the obligation to share commissions, fees, or to otherwise compensate another broker. (Amended 1/95) "

It seems like there are some of us who are bent on making sure that the buyer's agent gets paid something. This isn't a right or a guarantee. If the MLS states that sub-agency compensation is X and the buyer's broker compensation is $0. You have four options.

1. Call the agent and ask if they will pay a buyer's broker. If they say no, you now only have options two thru four.
2. Move on and don't show the property.
3. Work as a subagent
4. Work for free.

To mandate anything in the contractual arrangement with regard to buyer agency takes away options from the seller. It also removes the ability of an agent to choose specific parts of their business model.

If you are waiting for NAR to weigh in on compensation, you are going to be in for a long wait. They speak very strongly on cooperation (the foundation of the MLS and NAR) but have not, and my impression is will not make requirements for compensation. To do so would restrict free trade.

Cameron Piper

JR and Laurie,
Yes, I used the workd "exclusive" as in private listing w/ one company. I was not meaning it to be "exclusive right to sell". I differentiate between the two as follows:

Exclusive = Private: No co-broke compensation. Not in MLS. The seller agent will be paid by the seller and the seller agent will show the property. Exceptions: There are times when exclusive (private) listings will acknowledge sub agents, buyer agents, etc....but are simply labeled exclusive (private) because they are not in MLS. If I see a sign for "Exclusive", I call and ask if they are cooperating. Sometimes they are.

Exclusive Right to Sell: An MLS term meaning the seller will pay commission or professional fees, under the provisions of the contract, to the listing broker whether the buyer comes from a friend, neighbor, prior association, drive by, the lisitng agent, or another cooperating agent. If the property sells during the term of the lisitng, the lisitng agent will be paid. This provision is included to encourage the listing agent to provide greater marketing that might result in a buyer finding the property without going directly through the listing agent.

JR, knowing what the listing agent is receiving is between the seller/listing agent- it seems more reasonable to assume, with the amounts offered under the other agencies, that there is room for cooperation under buyer agency as well (or a deduction for the buyer, if they are paying out of pocket). Yet another thing to ponder, I suppose. You're right about the out of area sellers- it makes things more unique.

Exactly, JR, although I despise the "exclusive" sign riders on mls'd properties. I see lawsuits in the making (know of one already) from sellers that didn't understand the full impact of an exclusive (no cobroke) listing.

For that reason, if you ever make the request with a property that has a listing agent that has entered 0, be sure that the amount is "fair" to the seller- i.e., the same amount offered to a BrA or SA- no more than either offering ("fairness" to the seller), and put your justification in writing. Because, under BA, we are permitted to present the offer directly to the seller, it can be explained to them at that point. Amazing that lisitng agents make it so difficult to facilitate a transaction for a seller with whom they've pledged "fiduciary" in NY- just amazing. I've seen the 0's.
~~~~~~~~
Of course, I'd have to know what the listing agent was getting, which isn't in the MLS.

I have asked in a couple of instances to be present when an offer is presented and the closest I've gotten is over the phone, since we have so many second homes.

Deborah, it is truly an antiquated and consumer unfriendly environment here, almost requiring the scream- luckily, agents such as JR are looking at it with the same discomfort that outsiders do. As recently as last year, an agent that I respect very much brought an offer as a subagent- it was very uncomfortable. We recently got into a "tiff" with an agent that insisted on representing our seller with her buyer, but we put the brakes on that one- despite believing her that "it's the way it's been done for the 15 years that I've been in real estate here". It's NOT the Realtors- it's the system in our area of NY (Long Island). Sub agency??? I was absolutely horrified at that, as well as the "exclusive" aspect that existed, but appears to (PHEW) be with less frequency. We absolutely take a gamble when representing buyers, but for those with ethical sense, it just has to go that way- consumers are beginning to "get it", and anything that we can do to help is worth the occasional "rant". Poor Heather- she's been hijacked- with sincere apologies.
Back to NY on Thursday (grandbaby in Denver) to resume the "battle"....

Deborah and Laurie both, I think when you are using the term "exclusive" you are referring to listings that are only with one agency (what we call a private listing. It's an exclusive right to sell but is not on MLS). You don't mean "exclusive right to sell", which means everyone has to go thru the listing agency. Correct? I 'm pretty sure that's what Laurie means when she says the Hamptons still have homes listed with only one agncy (and not cobroked).

Options,

I understand what you are saying about Br A. I mistook that to be that you were saying that all istings should offer equal compensation to the buyer agent as is offered on the lisitng side. If all listing brokers were compelled to offer a specific compensation that was equal to the sell side, the compulsory act would be price fixing. But, that is not what you were saying. So, thank you for your response and explanation.

From what I understand now.....You are saying that if a listing broker is offering a compensation to sub agents or broker agents, they can and should be able to acknowledge and compensate buyer agents. So, I would agree with you. I agree that an agent should not be forced to become a sub agent to get paid, and be unable to represent their buyer client. I support buyer agency, and as a listing broker, encourage sellers to compensate fairly to buyer agents. Sub agency is legal in NJ...I just don't ever see it. We don't have broker agency. We don't have designated agents. Whether it is the same or different agents, it is dual agency if it's the same brokerage.

What you describe is similar to NYC. I don't think it is similar to NJ or FL. I see some NJ Realtors try to encourage buyers to buy from them as dual agents.

Exclusive listings are rare....but when they exist, I can be denied the ability to take my buyer. I don't understand why a seller would ever deny a represented buyer the option of buying their property. But, this is rare. Most of our lisitngs are in MLS. Although dual agency is legal, most transactions involve more than one broker. Interesting that some sellers want their listing agent to bring them a buyer, and consider the fact that it a dual agency transaction occured as a sign that that there listing agent is a good agent. Some sellers there may think that way.

Laurie,

Maybe you can post back some more specifics about your situation. What specifically are the agents doing in your area that "do not adhere" to the code of ethics?

I suspect that the agents aren't in fact breaking the code but rather not interpreting it the way that you want it work. If they are indeed breaking the code, file a complaint with the board, and let the system work.

I also read a lot of "concern" for the seller in your posts but this really isn't your issue. This only becomes your issue to the extent that you feel the agents should do it one way so that your business should be furthered. I love your concern for all consumers but suspect that your concern may only be a result of your desire to further your own business.

I want to be very clear to say that I don't think less of you for this and infact admire your strong desire to defend your position and the consumers you represent.

Cameron Piper

When I got to this area six years ago, and wanted to continue in real estate, all of the signs had "exclusive" on them. THERE WAS NO MLS IN USE HERE. As JR can attest, the North Fork FINALLY accepted the mls three (?) years ago, with much lack of comprehension understood as growing pains. The good Realtors embraced it, but the brokers out here (including one large NY company) still encourage the "double end" AND sub agency, which until last year, was offered on all listings, and used by MANY agents. Now that buyer agency has been accepted and understood by the good agents, there are still companies that do not want to participate in the practice, making it very difficult for those that understand it.
I sold new instead, which permitted me to do the contracts, etc., as had been done in Denver in both new and resale.
The companies that do not want to pay a buyers agent (we are not talking about rebate companies here, although I wouldn't care WHAT a buyer's agent was offering the buyer, as long as my seller is treated with a fair price/terms) offer broker agency, which is an indecipherable mess, and sub agency. They are NOT of the fiduciary mindset that the ethical agents understand, and as a result, make things ridiculously complicated for the growing (but not fast enough, imo) agents that simply want an ethical transaction.
Exclusive listings are common in the Hamptons to this day, with companies "deciding" which brokers will be permitted to show properties (to the exclusion of the majority). They evidently are unaware of the illegal nature (per the DOJ) of these actions, but may well soon be introduced to the ramifications.
Coming from a "simple" place has been a nightmare, but more and more Realtors are understanding the nuances that their brokers failed to explain/train them on.
Deborah, "price fixing" involves an agreement between two companies. From a buyer agent perspective, permitting the buyer to achieve a discount in the amount of what is offered under sub or broker agency is up to the buyer's agent, one who doesn't want to see a buyer forced to pay a fee that isn't to their benefit, AND a fee that is (one in the price of the house, the other via the contract).
I have yet to receive an adequate explanation of BROKER AGENCY, so we don't bother with it.
https://www.mlsli.com/ro/dod/215.pdf
Because Denver eliminated sub agency in the late 1980's, going back to that thought process has been impossible, and maintaining a "go with the flow" attitude unthinkable.

Options,

I am not sure what you meant by having the buyer agent compensation ve the same as Br A. I might not have understood. To the best of my ability to read what I think you said......

To force the exact compensation from Br A to the buyer agent is price fixing and that is illegal.

Here are some reasons why it would also be inequitable:

In answer to buyer agents who seek compensation without doing work, we are seeing selelrs and selelrs agents offer a base compensation in MLS with a bonus. Any buyer agent who brings a buyer to the table gets the base compensation, and the buyer agent gets the bonus payment for fulfiling the other items on the list of duties for which the compensation is offered.

You can't simply say that buyer agent compensation should be X or equal to Br A, because some listings are flat fees and some listing fees are raised to offset high print ad invoices, professional photography, videos, dedicated websites, etc. Sometimes the compensation on the listing side could be higher or lower, depending upon what products, promotion, and services were provided.

Maybe I did not read your post correctly.

I still don't think LI is a world in and of itself. Sure, there are some nuances local to LI. One thing I am curious about,.....Is sub agency common in LI? I haven't seen a subagency contract in at least 10 years. It stil is shown on MLS and the contract forms, though.

Out of curiosity....in any area of the country....is sub agency common? Does anyone use it at all? Curious.

Yes...I am a strong supporter of buyer agency. I encourage our sellers to compensate buyer agents competitively for our market. I will leave the numbers out of the discussion in respect of anti trust laws.

Deborah

Cameron, my issue is not with the COE, my issue is with an area that is unable to ADHERE to one aspect of the COE that creates issues with consumers. Hey- here's a plan: how about agents here accept that buyers deserve representation, and respect that desire with the same compensation that is offered to Br. A or sub-agency? That would simplify, and make equitable, the entire equation. In the absence of that, expecting an agent that has a property in the MLSLI offering 0 or $1.00 (likely without seller comprehension) is a whole lot less realistic than you indicate. Their own comprehension/ethics are evident. Buyers will force the issue, and hopefully then, our area will cooperate in the best interest of the consumer. Until then, we'll do the right thing. I'm not getting any argument that it's the wrong thing.
Best to you.

I did not say that representation for both parties is a long way off. I said, individual hiring of agents and negotiating fees is a long a way off. Across the nation, buyer agent fees are typically negotiated as a coop payment from the seller. Buyer agents, across the nation, are more often than not, paid a cooperative compensation as outlined in a seller's listing agreement with the lisitng broker. What I said, is that buyers are starting to choose, hire and negotiate a fee structure directly with their buyer agent. This is still the exception, not the norm. It will take a long time before it becomes the norm that buyers hire and pay for their representation, and sellers hire and pay for only theirs. Buyer agent compensation has come from coop payments for many years, and change is slow.

But there is change....

In states where rebates are becoming more common, some sellers are asking how they can avoid paying the buyer agent. Sellers are complaining that they are being ripped off because they offered the buyer agent compensation to do a job, and sellers are complaining that they should not have to pay the buyer agent who does not show property, come to inspections, present offers, etc. Note that these are seller complaints.

Buyer agents are starting to use buyer agency agreements more and buyers are becoming more familiar.

Change is slow. There is a trend toward separating the fee negotiation with buyer and sellers hiring and compensating individually. Buyers will still, often, include the payment of such fees in their offer offer to purchase for the seller to pay, on the buyers behalf, from the proceeds at closing. This could be compared to a buyer writing an offer and asking the seller to pay points, or other closing costs.

Dual agency is allowed in NJ, but not in FL. In FL, the seller agent moves to a position of transaction broker if working with both a buyer and seller. Maybe we will see the day come where clients hire and pay their own representatives, much as attorneys are hired to represent exclusively one party's interest. I support movement in that direction, and having buyer agency agreements is a component of a movement in that direction.

Deborah,

Thanks for backing me up on this one.

Laurie,

This really gets back to a core issue for you. You don't think that the Realtors Code of Ethics is fair. I disagree with your interpretation of the code, but ultimately the beauty of America is that it is a free country. If you don't agree with it, don't join the MLS, or better yet start a more competitive model and let the free market work. If your model is better it will replace the old model over time. I do have a problem with you working for the outside to change something simply to benefit your way of doing business. In 2nd grade terms it would be stated, if you don't like the rules, don't play the game.

To your submission that an "unfair" contract is inherently voidable creates large problems for the entire contract law system. I'm not an attorney and don't know what your lawyer friend was explaining to you, but certainly "fair" is a very subjective theory. What you think is fair and I think is fair is two different things, as evidenced even by this post. Both are inherently correct because it has to do with our personal feelings on the matter. If all contracts were voidable if they were unfair, there would be no such thing as a binding contract. I would simply have to stomp my feet, pound my fists, and say that isn't fair and it would be void.

In the end if you want to succeed in business you will need to be able to defend and earn your own commission. You can't always rely on someone else to make sure that you get paid. That is your job, not the listing agent's job. Take the personal responibility to earn your own commissions and if the listing broker is offering buyer's agent compensation, ask them to reduce their fee to the seller. I doubt that you will find many that object this.

Cameron Piper

Deborah, incorrect- my resale experience, however, was in Denver. Don't worry about removing your comment- it is fine with me. If you are not understanding the point that I'm making, that's also OK- but I'd be careful with thinking that representation for both parties is "a long way off"- it's COMMON PRACTICE in the majority of areas. There will be no relaxing with the practices common in NY and NJ (I bought my dad a place in NJ, so am aware of the general practices) because it's not a Deborah issue, it's a consumer issue. Once real estate has been practiced in a progressive area, there's no turning back, and accepting unacceptable practices.
Our blog speaks to consumers, NOT Realtors.
Condescension is very transparent, so I leave it to consumers to accept or reject both your views, and my own, using common sense.
I never indicated in a response that you were from LI, but know that NJ isn't much better overall, needing an overhaul.
No more kibbitzing with you- it's not productive for either of us.

Options.

Cameron's interpretation is correct. The Code of Ethics is national. I have never seen a buyer agency agreement ask for double compensation. I have only ever seen a compensation clause state that the cooperative compensation would be applied first.

While there are certainly local customs in many markets, the challenges you are describing are not uniquely yours. I have seen $1 compensation in both NJ and FL MLSs. This was because the MLS rules said there must be some compensation in order for the property to be included.

I agree in theory, in a perfect world, that buyers and sellers would individually hire their agents and negotiate fees for representation. It will not transition from it's current practices overnight, but I do see that happening over time.....but a long time.

Some of your comments indicate that you are still fairly new to resales, and making some incorrect assumptions. No, I am not in LI, and my comments pertain to general issues that are not exclusive to a geography. Some of your antagonism toward other Realtors and agents might simply be resolved in time. I am a strong advocate for raising the bar for obtaining and maintaining a license, and a harsh critic of lazy agents. But, I know a lot of really hard working, ethical, knowledable Realtors. I read your blog, and it comes across that every agent out there is a scoundrel....except for you. You might want to rethink that. It's not possible that every agent in LI is unethical and doesn't know anything. I appreciate your passion and your desire to do right. Maybe a deep breath, better understanding and time will help bring some balance into the equation.

Deborah

PS I plan to remove this post within 1-2 days.

Deborah

Would it not be reasonable, as a listing agent (inherently fair) to waive the selling agent part of the fee, in the absence of a selling agent who would be compensated under sub or broker agency, but in the presence of a buyers agent (fairness to the buyer is also required of the listing agent)? That's the dilemma facing buyers agents who SEE an amount paid, know that the buyer is absorbing it, yet also know that it's fundamentally wrong to switch to a different agency in order to receive compensation, or require that same fee out of pocket as well as absorbing it in the price, instead of being up front and ethical to both parties? Fairness to the buyer, and fiduciary to the seller would require this action on the part of the listing agent, don't you think (seller saves the part of the fee offered)? I value your input- thank you.

And, Cameron, a quick addition: "fiduciary" to the buyer would include eliminating the overpayment of a property wherein the fee for such a service is essentially paid for twice, via a contract and in the price of the home (when the fee is offered to other agency relationships, but not BA). Unless the listing agent is wiling to waive the amount offered for other agencies, it puts buyers agents in a mess- if the fee is waived, then I agree. If not, it's incumbent upon a buyers agent to push the limitation imposed for a rule that was established for reasons OTHER than exclusion that, in all likelihood, was never properly understood by the seller. Inherent unfairness in a contract potentially voids a contract, as explained to me by an attorney.
If agents would simply behave ethically all the way around, there would be no issue here, as there is not an issue in most areas regarding representation for both parties. In my mind, there is "inherent unfairness" to the buyer, if they're paying twice, risking the validity of a BA agreement, as well as the listing agreement, with an uninformed seller. Subjective, and unnecessary all the way around.