Within my agreement, it states that the seller agrees to refer all inquires of purchase to me and I will coordinate the entire transaction. If they are aware that someone is interested at the time of the contract is being signed, I will put a commission waiver in there if they procure their own buyer(s) within the first 1-2 weeks and reduce it by 50%. Finding the buyer is only 1 piece to the whole complex puzzle. Now that the buyer has been found, the agent will provide all of the disclosures, draw up the contract, negotiate the best terms and price for you, provide referrals to ensure the transaction goes smoothly, aid in the inspection, assist with financing, coordinate and attend the appraisal, research existing mortgage pay off information, schedule and attend the smoke certification, arrange for the final water/sewer reading, and schedule and attend the closing. And he/she will do all this while representing your best interest, taking on (most) of the liability and being your record keeper 7 years. (Breath:) So yes, I believe not only is the agent contractually obligated to receive the whole commission (in my agreement anyway), ethically they are entitled to it too. Additionally, the law (in my state) does not allow me to give a commission or a referral fee to someone that is not a licensed agent.
Melissa Mancini, Realtor, CBR, GRI
The subject of procuring cause will come up.
If you are thinking that the listing will expire, and you will cut out the agent from any commission, I encourage you to seek legal counsel I am not an attorney. However, my guess is that your Realtor's broker has an attorney on retainer.
Again, read your listing contract. With all due respect, you are not an experienced real estate professional (at least, not from your profle). Do you think that your idea is new? That no one has EVER thought about excluding a Realtor, who has invested time, money, and effort into selling your home?
In Rotary International we have the Four Way Test:
1. Is it the truth?
2. Is it fair to all concerned?
3. Will it build goodwill and better friendships?
4. Is it beneficial to all concerned?
I do not know the specifics of your situation. However, if you are, in fact, trying to defraud the Realtor of a justly earned commission, be careful This is old news in our industry.
On the other hand, it may be that you have every right to do as you propose.
Do the RIGHT thing...not the thing that makes You the most money.
The previous posts are correct. Check your contract. Your Rrealtor invested a great deal of time, effort, and capital to procure a buyer. He/she made these investments without any guarantee of collection. In order to be paid escrow needs to close.
There is also a BIG difference between finding a buyer (no matter who) and closing esxrow. Is your buyer qualified? What happens if there are negotiations?
My suggestion is two fold:
The Realtor who is the listing agent receives payment no matter what, if the property sells. His /her job is to expose the property. So if your family member saw the sign in your yard, the Realtor did his job.
On the other hand, with a family member in particular, I would candidly discuss your optoins with your Realtor. If it were me, I would suggest to you that another Realtor represent your family member.
This transaction is not just about real estate. Right now you feel pretty good about things. What is, during the course of the negotiations, something bad happens? Are you prepared to sacrifice your relationship to sell your property?
Having a different Realtor rrepresent your family member insures that BOTH of you will have adequate representation.
I do understand your frustration, however. I would recommend having a calm discussion with your agent. If you start demanding or claiming that you are entitled to a portion of the fee, it won't get you anywhere. If your agent is to make any concession towards lowering the fee, it will only be out of a sense of fairness and goodwill. I strongly suggest not going the route of waiting for the listing to expire to complete the transaction. Not only is this bad faith, as the agent has invested time, money and energy to get your property sold, but the agent will definitely pursue you for compensation. The listing agreement will have terms that are designed to prevent this very scenario.
If you were qualified to do all of the functions (as noted in my prior post) that an agent does on the buying side, then that would be a different story, but when there is no buyer agent to coordinate everything on the buyerâ€™s side, then the listing agent is doing twice as much work, thus justifying receiving twice as much compensation.
Melissa Mancini, Realtor, CBR, GRI
I am sorry you are feeling cheated. Did your agent fail to perfom in any way. Did your agent neglect to do anything that was asked for in the agreement? If you agent performed, and you came up with the buyer, a family member, how is that something the agent did wrong. I feel don't have a warm fuzzy feeling about your decision. I would hope I never have a client do that to me. You should have exhausted all family members before you listed the house.
Second, this is something that should have been discussed with your agent before signing the agreement. However, the seemingly not so simple answer to your question is YES you have the RIGHT to sell your own house, but only as far as your agreement allows (which it usually doesn't). Realtors have said you cannot take a "commission," which is correct. But keep in mind, you are not "paying yourself a commission" simply by selling the house and keeping what you make. It is semantics. If you ever have it to do it over just don't call it a commission... in the case you bring your own buyer, lower their commission and net the additional amount.
I also want to address the idea that all real estate transactions are complex and must be dealt with carefully by a professional. This is not true. All real estate transactions are not complex and depending on the terms and where the funding is coming from, it can be very simple. There are a lot of great realtors out there who will work hard and represent you well. Some are long time professionals with a proven track record. Others are graduates of a two week night class. Call a title company and start asking questions. What it comes down to is this... If your time and worry is worth 6% of the sales price, then realtor up. If not, you can do it on your own. Or you could have if you hadn't signed that contract : )
When I presented the full price offer, they said that's nice, but our neighbor has jus brought us an offer for $10,000 less and since that is the amount of the commission, we took her offer instead. We will net almost the same money.
This lesson taught me to never fully exclude a potential buyer from a listing commission. The neighbor might never have acted had she not realized there was competition for the house. My sales efforts were the impetus and the spur for her to act.
If a seller wants to have a partial commission due to the listing agent instead of full one, they should negotiate that in advance when they first sign the listing. I presume you were related to this family member before you signed the listing.
Did you and the family member discuss selling your house to her before you listed the house? If you did, you and your agent should have had a discussion about it then. In any case, your agents efforts along with yours have spurred your relative to want to make an offer. Your agent deserves the compensation called for in his/her contract.
Bill Wootan - Team One
Century 21 H T Brown
That being said, the listing agent may not be "entitled" or have "earned" the commission, that is another story.
I will have to review contract, I know it references a co-op for buyers agent, not sure if I locate buyer.
I can't see paying an agent 100% commission , when I did the work. I would rather take the house off the market or let the contract expire, then sell directly to the buyer. The listing agent had nothing to do with the buyer, no showings or anything else.
1. What your listing contract says about commission. ..... does the contract state the listing agent will make some agreed upon allowance if you bring the buyer.
2. In Arizona we required by law to pay commissions only to licensed agents working for a licensed broker.
If the listing agent did agree to re-imburse you in some fashion ( even tho' it's not in the listing contract ).......the listing agent could reduce the commssion due by some agreed upon amount........in effect giving you a "commission" or what ever you wish to call it.
Money by any name is........money.