Now, you have a couple of issues here. First, You say that you reviewed your HUD1 MONTHS later. How smart was that? Now you find that your agent was not compensated in the amount you thought you had agreed to give them. Well, if you have a signed agency agreement and it says that your agent gets more than the seller agreed to pay, guess who should pay it. (Clue: have a looking glass handy.) Your agent, following current practice, probably just took the compensation that he or she could get from the sellerâ€™s broker. Unless you reworked the standard NJAR sales contract, thatâ€™s all that the seller has to pay your agent. Actually, they are only paying their agent and allowing that agent to share with the co-operating brokerage. The listing brokerage has to tell the seller how they intend to split the commission and get their approval to do so. This is normally done in the listing agreement, long before your agent and you came along.
Bottom line: If your agentâ€™s brokerage has a written agreement to get a commission from you and they did not get the full amount of the agreement, they have been very courteous to you. If you feel they deserve more, dig into your pocket. If the agreement was verbal, who knows what it was a year ago? Most verbal agreements â€œarenâ€™t worth the paper they should have been written on.â€
My advice? Forget it and send some new business your agentâ€™s way.
I don't know what you eventually agreed upon, but these are the only legal options and must have been explained to you in great detail and then signed off on by you. If that's not the case......well, that's up to the NJ Real Estate Commission and more can be found here http://www.state.nj.us/dobi/division_rec/index.htm
Either way, find out in greater detail what you agreed upon. All this must have been in writing and is probably part of the paperwork. But under no circumstance do you as the buyer determine what your representing agent's commission percentage is. That is up to the seller and the seller alone.
Real estate fees are negotiable, which is great, but sellers generally still offer at least some compensation to buyers' agents. The REALTOR Code of Ethics, which requires that REALTORS cooperate with other REALTORS had to be amended a few years ago to say that "cooperation" does not mean "compensation", and both the Code of Ethics and NJ law recommends that all agency contracts (which indicate who the broker is working for, for how long, and what the broker will be paid) be in writing. The negotiations between the seller and the listing agent about how much compensation to offer buyers' agents should not, in my opinion, be the governing factor in what a buyer's agent should be paid.
As William posted, you didn't take a hit, your agent did, and it would be very nice if you sent your former agent more business. Agents work for a living, and I don't think there are many people who work at other jobs who can take a hit of 15-30% on their earnings because of what other parties to the transaction negotiated. (Which is what accepting a 2% or 2.5% fee, when you negotiated that you'd be paid 3% amounts to to the agent.)
I'll get off my soapbox now. ;-)
Joan Prout, MBA
RE/MAX Villa REALTORS
Jersey City, NJ