My buying agent is charging me $500 for the broker fee and $200 for the team fee for buying a foreclosure....is this right? I thought that all the

Asked by Nguye402, Diamond Bar, CA Thu Apr 29, 2010

commission is paid by the seller at closing. For example, if a seller pays 6% commission of selling price to the listing broker, doesn't 3% or somewhere around that goes to the buyer's broker? So why am I being charge? Is this normal?

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12
Centermac Re…, Agent, Fremont, CA
Sat Sep 22, 2012
It is not common but not illegal. In most transactions, the sellers, not buyers pay the commission.

But buying a property through foreclosure can't mean different things. It can mean buying it as a short sale or REO in which case typically sellers pay the commission. But if you hire an agent to go the auction site for a trustee's sale, it is often the buyers who in this case are the successful purchasers at a trustee's sale. How much the agent charges you for that service is negotiated between you and the agent. There is really no norms in that instance.
0 votes
Shereelally, , Louisville, KY
Wed Sep 19, 2012
It's not normal in my area.
0 votes
Trinidad Gae…, Agent, Diamond Bar, CA
Wed Oct 20, 2010
nguyen402...

I know this answer comes a little late but I thought I'd share my thoughts in case someone else finds themselves in a similar situation.

You asked about commissions paid by sellers. Those are standard commission fee's, however those fee's are negotiated between sellers and listing agent. Listing agent in most cases offer selling agents half of what they negotiated with their sellers.

Fees being charged to you as a homebuyer from a selling agent although not very common still a negotiable item. A fee that must be disclosed to you and all parties involved.

Agents that charge this additional fee are doing it because they feel their value as an agent for the services they provided warrant the fee or perhaps feel they can pass a quick one by you! That's my opinion.

My advice would be that you discuss all fee's up front before signing any agreement.

Good Luck,

Trinidad
0 votes
Brad Davidson, Agent, Placentia, CA
Fri Apr 30, 2010
Walk away from that agent immediately. Don't renegotiate. Any agent that isn't satisfied with making 2.5% to 3% on a deal is greedy and may not represent your interests above their own. If you're already in an escrow threaten to cancel unless they waive the fee. There should NEVER be any extra fees to a buyer or seller in a standard real estate transaction.
0 votes
Joanna Jensen, Other Pro, Livermore, CA
Fri Apr 30, 2010
Your signing an agreement between you and your agent who will be representing you. . He is trying to get paid for doing work. That fee is negotiable like ALL fees are.

I have never heard of that but one thing agents are not allowed to talk about is our fees. We could be fee fixing and that is unethical.

However you can find a new buyers agent. But please do keep in mind it is a lot of work. If you want a good agent to represent you 1) make sure you get someone who is doing a good service for you they will be earning money off of what you buy.

2) Dont shop with one agent and buy with another. It is so much work and really unfair to us. We dont typically get paid for what this agent is trying to charge.

We hope you like us and our service enough to stay with us. Not that you signed an agreement and will be in trouble if you break it.

I prefer to be a resource to my clients!!

JoAnna Jensen
Realtor Legal Assistant
925 699 5041
Legal Realty

Loan Mods, Short Refinance, Secured Short Sale,

Solutions fo All Your Real Estate Needs
0 votes
Dee Ryan, Agent, Maplewood, MN
Fri Apr 30, 2010
Hi Nguye402,

The listing agreement commission is a agreement between the listing broker and the seller outlining how the listing commission will be dispursed. The buyer broker agreement is the agreement between you and your buyer's agent outlining how your agent will be compensated.

Buying a home is overwhelming and there are quite a few legal issues to cover the day you sign as a client so make sure you go through the contracts again with your agent so you can see if it is specified. My other advise is to have your agent review your HUD before you close explaining all the charges ensuring everything is correct. You always have the right to stop the close if something is not right
Web Reference:  http://www.deeryan.com
0 votes
Connie Bramb…, Agent, Rancho Cucamonga, CA
Fri Apr 30, 2010
Hi Nguye,
It sounds as though Your agent is passing fees they should be paying themselves along to you, or just charging you more money. If you did not already agree to it, get another agent! You are correct in that the seller is paying the commission already. Sometimes sellers do not want to or cannot pay a whole commission. If that is the case the selling agent (your agent) may ask for commission from you the buyer. Ask the agent what is the reason for you paying this. Ask them if the seller is paying them too.
Connie Bramble
Prudential CA Realty
714-337-8718
0 votes
Diana Margala, Agent, Rancho Cucamonga, CA
Fri Apr 30, 2010
As the other agents have mentionted ususally the fees are paid by the seller and it does depend on if you signed a buyer broker agreement and the terms set forth in that agreement. If you have not signed anything agreeing to pay those items and they weren't put in the offering contract or an amendment you might not owe them. That being said, since this is a forclosure and if the purchase is through an auction many times the buyer pays for fees that are not normaly buyer fees in that type of a transactions, but there again it depends on what has been agreed by the buyer and the broker.

Good Luck
Diana Margala 909-560-0145
Web Reference:  http://www.dianam.com
0 votes
Don Tepper, Agent, Burke, VA
Fri Apr 30, 2010
I'm familiar with brokerages requiring a "transaction" fee on all transactions. The one I'm with does that. It's not $500, though. However, it gets charged in all cases. Sometimes you can persuade your agent to pay it, but it must get paid.

I've never heard of a "team fee" in a transaction, though. So I don't know if that's something your agent is also required to pay, or whether it's just an additional sweetener for the team.

One other factor in foreclosures: Sometimes in short sales and foreclosures the total commission amount is reduced, or it's less than the customary commission rate for the area. It's possible part of what you're being asked to pay is intended to offset a very low commission rate.

Best thing to do is ask. Your questions are legitimate. Ask your agent to explain where those figures are coming from. And keep asking until you get a complete answer.

Hope that helps.
0 votes
Keith Manson-…, , Milwaukee, WI
Fri Apr 30, 2010
It depends on the buyer agency contract you sign and what the expectations are by you and the deliverables by your agent. The typical buyer agency has a agreed on fee that is typcially paid by the seller and sometimes the buyer will supplement the fee paid by seller if minium commision is not being paid .

If you are looking for specific services which are not tied to the closing of a property a buyer agency can be created for a fee for service provided. What ever you signed in contract form can be charged when creating a buyers agency.

Keith Manson
First Weber Group
Certified Distressed Property Expert
Metro Milwaukee

http://www.milwaukeebailout.com
0 votes
Emelia Sanch…, , Ontario, CA
Thu Apr 29, 2010
Nguye402, that is a little steep $700.00? Not all agents charge this. If you haven't signed a buyer broker agreement I would suggest you look for another agent. When you are writing up the offer and your agent puts this into the "buyer to pay" let them know you do not agree to this and ask them to remove it.
0 votes
Hector Haro, , Diamond Bar, CA
Thu Apr 29, 2010
That is correct most selling agents get from 2.5% - 3% for representing the buyer. It is not normal for the selling agent to charge the buyer an additional fee since they are already being compensated, some agents charge a "transaction fee" or a "broker fee" but it is up to the client whether they want to pay the fee or not, but the agent does have the option not work with you if you don't pay their fee.
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