If the working relationship established was based upon the buyer agent compensation to rest upon the coop broker fees paid through a listing contract by the seller, you do not owe the agent anything. My statement is predicated upon the fact that you acted in good faith. You thought about buying a home, investigated your opportunities and made a decision not to buy. You and the agent had an honest business relationship, and you owe the agent nothing.
If another buyer described a story where the buyer had a plan all along to buy his neighborâ€™s property, but deceitfully induced a buyer agent to spend time and energy with the buyer and educate the buyer to aid his goal of purchasing a predetermined property where the agent would not be paid, I might say something different. In that case, I might suggest that the buyer does owe the agent something, and the payment arrangements should be worked out with the broker. All compensation must be made to the broker, and the broker must pay the agents.
There are several new models of real estate brokerage popping up. As we have seen negotiated fee structures become more diverse, so are compensation models expanding beyond a commission at closing only arrangement. Buyer agents act as advisors for rates, services are offered for fixed fees ala carte, deposits are paid up front with rebates included on the back end. It is no longer only a world of buyer agent gets â€œX%â€ at closing. The industry is evolving beyond the world of â€œonly this wayâ€ and this is the only way it â€œshouldâ€ be.
However, if the arrangement that you had with your buyer agent was based upon a commission at closing paid by the seller, you have no obligation to pay that agent. The agent accepted a business arrangement, and sometimes business arrangements donâ€™t work out. If you believe that the agent worked hard for you, a well written thank you and reference letter that he/she could hold in their file may be quite meaningful and helpful for the agent.
Deborah Madey - Broker
Peninsula Realty Group