Home Selling in Carmel>Question Details

Slekcin, Home Seller in Carmel, IN

My realtor SELLS for a commission of 1.5%. Helps you buy for a commission of 3%. Do realtors "blacklist" realtors who do this?

Asked by Slekcin, Carmel, IN Thu Jun 9, 2011

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Realtors are professionals, who pay a hefty price to work in this business
and live off commission ONLY. That is hard to do, hard to manage your
money, hard to pay expenses when a listing does not sell or a buyer
with whom you've worked for 6 months suddenly walks away or cannot
get financing.

I am going to assume your Realtor is charging you a commission of 1.5%
and giving 3% - 6% to the buyers' agent. If you have signed an agreement
with your Realtor to purchase your next home from him/her, and the
commission on the buy side will be enough to cover his expenses AND
make some profit, then he/she may feel it necessary to do. And is probably hoping all goes well. But remember, if your home does not sell, your Realtor is working for nothing. I don't know anyone who can afford to work for nothing. Or rather, pay to work actually, instead of get paid. After all, listing a home, paying for signs and handling calls and appointments takes a lot of time that can't be spent elsewhere.

Do other Realtors blacklist someone who is willing to risk what little financial security there is in our business because of this? No.
2 votes Thank Flag Link Thu Jun 9, 2011
Slekcin,
Agents cannot create a "blacklist" of companies or individuals that a group or company won't do business with. An individual however will do what they feel is in their interest. So, if an official Blacklist exists this would be a serious violation of the rules and likely the law. But if John or Mary agent choose to omit agent Tom's listings from their recommendations it would be difficult to prove.
For what it's worth, listing a home with a commission amount that makes you less competitive is rarely a good strategy. You and your agent are free to set whatever terms you choose, but you should be aware that this strategy may cost you time which will translate into money if you sit on the market for too long.
Agents are people with bills and families too. If two homes would equally meet their buyer’s needs and one offers a more substantial commission than the other, chances are good it will sell first. Wouldn’t you do the same thing if you were in the agents position?
1 vote Thank Flag Link Thu Jun 9, 2011
Yes, some do. But I understand that it is not illegal to blacklist an agent over the BAC rate.
0 votes Thank Flag Link Thu Aug 7, 2014
Realtors do not blacklist other Realtors for their choice of commission. In fact, we have no way to know what your Realtor is charging you, so there is nothing to blacklist.
0 votes Thank Flag Link Fri Aug 12, 2011
Alan May, Real Estate Pro in 60201
MVP'08
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I'm assuming that you are paying out 3% to the buyer's agent and 1.5% to your listing agent? So 4.5% total cost to you? If that is the case and if your Realtor is not a limited service broker that won't handle the closing process, then I wouldn't see any reason for other Realtor's to shy away. That's not to say that your activity level on the home might not be the same though.

I ended up listing someone's home (and selling it) that had a Realtor before me that had offered basically the same package deal. But their marketing, followup, etc was not the same. Even though a Realtor has the fiduciary duty to service the client, it might influence them if they were getting paid more to do so. Especially if they have any other listings that are paying more. Should it be like that? No. But does it happen? Yes.

The only time I worry about showing a listing is if it is a brokerage that the seller only paid a flat fee just to get the home listed in the BLC. Because then you have the chance of technically doing double duty to make sure the deal ends up closing. But if my client wanted to see the home, I would not and should not tell them no based on my own personal gain or lack of gain.

Good luck!
0 votes Thank Flag Link Fri Aug 12, 2011
There is room in the real estate industry for all levels of pricing and service. Just be sure that you understand what you are getting and what the total cost will be.

My recommendation is to always talk to at least 2 and preferably 3 realtors. Make sure that they understand your objectives and then ask them for the specifics of how they will meet your needs.

Then make your decision based on who you think will give you the best chance of getting to where you want to go.

Whenever you sign a contract with a realtor (Buying or Selling), I suggest you ask your him or her to include a statement that gives you the right to cancel the agreement if you are not satisfied with the service. The good ones will have no problem with this clause.
Web Reference: http://www.JohnHerreid.com
0 votes Thank Flag Link Thu Jun 9, 2011
Yes, the question is still confusing. Are you selling a home paying your Realtor 1.5% commission once it is sold & then buying using the same Realtor & paying a 3% commission once the new home closes? If you are only paying 1.5% to get your home sold, then what is your agent offering to the Buyer's Agents as a commission?
0 votes Thank Flag Link Thu Jun 9, 2011
I am not aware of any "blacklisting" if something like that existed it would be bad and likely illegal. That said, I am not 100% clear on your question...can you give more specifics?
0 votes Thank Flag Link Thu Jun 9, 2011
The Realtor only pays 1.5% to the person that brings a Buyer? That sounds anemic and doesn't motivate a buyer's agent who is driving buyers all over creation.

I don't know the specifics of your area but that sounds like little incentive for the buyer's agent.
0 votes Thank Flag Link Thu Jun 9, 2011
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