Rentals in 02458>Question Details

eyup2k, Renter in Newton, MA

Can a RE Broker still charge a proposed tenant a fee on a rental property if the lease was never executed?

Asked by eyup2k, Newton, MA Sun Mar 24, 2013

No lease has been signed by Landlord (LL) only by proposed tenant (PT) but with contingencies based on (LL) renovations. Property is "Leaded". In the interim, PT discovered she was pregnant & withdrew her offer of a lease. RE Broker has now charged PT with a full months rent for "backing out of the deal". However, the the lease was never executed by the (LL) so there was never "a deal". Nor was there any disclosure on situations where she could forfit any deposit. Does the PT have any recourse in recovering her money? Does the RE Broker have any legal standing in this case? Thanks

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Greer’s answer
As Shane noted, if this is an issue being taken into legal dispute, then you would be best served by consulting an attorney. I believe most attorneys will tell you that there is always recourse, it's just a matter of how much money and effort you are willing to spend to pursue it.

I suspect that you have thrown your question out to the community to find out if there has been any precedent set in previous cases on which to determine whether it would be worth your effort to pursue this matter.

Some other questions you may wish to pursue are ... how "leaded" is the property? The LL is legally obligated to delead the property upon the birth of the baby AND obligated to house the tenant if displaced during the deleading process. The LL can not back out of the lease just because the tenant discovered she was pregnant. That would violate MCAD laws. A real estate professional can NOT lease out a leaded property to a tenant with a child under the age of 7. Seems to me that these would all factor into the case as well.

Best of luck.
0 votes Thank Flag Link Tue Mar 26, 2013
Hmmmm. Best to talk to an attorney. The line is often blurred (in consumers' and some brokers' minds alike) about the distinction between attorney and real estate licensee. But brokers are not really qualified to give legal advice.
0 votes Thank Flag Link Mon Mar 25, 2013
It all depends on the agreement signed. Things happen and most people are willing to work for a mutual agreement.
0 votes Thank Flag Link Mon Mar 25, 2013
I have my clients sign a fee disclosure form and that holds them to paying a fee in the event that they back out.

As someone else mentioned, the agent has time and money invested. The owner may have taken the apartment off the market and any backup offers may now be gone. Paying a one month fee to get out of a deal is a good deal for you.

It's up to the agent if they want to let you out of the deal.
0 votes Thank Flag Link Sun Mar 24, 2013
Read the fine print in the application.

Generally, and I feel you could agree that it makes a lot of sense to forfeit the fee. Consider your situation. 1) you only recently found out you were pregnant and clearly changed your intentions. This is not stemming from anything the LL or agent did. (unless it is a paternity case LoL) 2) in all likelihood both the agent and the LL went to added time and expense to prepare the property. And the LL may have taken it off the market. Frequently the LL will miss at least one months rent because of the tenants change of heart. 3) it generally takes 10 months to have a baby, so if you recently found out about the pregnancy you could still move in for 9-10 months, probably 12 unless that baby is a very early crawler or can eat solid foods in the first 3 months.

For the court approved answer you would have to go to court with all the documents the applicant signed and be sure of what that application agreement said with regards to return of the fee.
0 votes Thank Flag Link Sun Mar 24, 2013
I am not an attorney, but I think the agent would have to have had you sign a fee agreement form that provides for how your deposit would be handled, when it would be returned and under what circumstances, and when it would be forfeited and for what reason. Failing that, a judge in small claims court would most likely rule in your favor as the lease was not executed by the landlord. Talk to an attorney though, as there are a lot of moving parts to this story, and your side of it alone may not be as clear cut and unbiased as it sounds on first read. I'm sure the agent has a different take on it. My policy is to return the deposit, as its not advisable to create more stress and disgruntlement into the rental process- there's plenty of that to go around anyway!
0 votes Thank Flag Link Sun Mar 24, 2013
Ed, Thank you. There was never so much a mention of a 'fee agreement form' nor such a form signed. Is this a standard form that realtors would typically use/and or disclose?
Flag Sun Mar 24, 2013
Read the buyer's/renter's agreement with the agent.

The answer--contained for certain in the agreement--is "probably yes."

You say there was never an executed lease. OK. So? Read the signed agreement to see what the proposed tenant agreed to.

The question isn't (here) whether there was a "deal" in the form of a lease. The question is whether there was a "deal" in the form of an agreement where the real estate agent was owed money if he/she performed certain services.
0 votes Thank Flag Link Sun Mar 24, 2013
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
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