Recently had an on exchange about how agents charge commission. Maybe you guys can explain it to me.

Asked by mia, Los Angeles, CA Fri Mar 7, 2014

When an agent is representing the renter-to be and advises the said rent-to be to terminate the lease, prior to occupancy, and the owner and owners agent both agree and refund the deposit, would the renter-to be's agent keep the homeless renter's money?

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Answers

9
Kathleen Bec…, Agent, Santa Monica, CA
Mon Mar 10, 2014
Why are you terminating the lease prior to occupancy? According to your lease agreement, which would be the governing document in this case and with the agreement in writing of the owner and owners agent agreeing to refund your deposit, your agent should not be able to keep any funds...commissions are typically paid by the owner after the contract is executed and all funds have cleared the bank.

Your funds should be returned to you in full if the owner and owners agent agree in writing. The commission would be payable from the owner to your agent, not by the renter/tenant.

Refer back to your contract. However, there may be a clause in your contract, and if signed by the owner, could make the owner responsible for paying the commission to your agent...even if you cancelled...

Also, did you sign a Buyer/Tenant/Agent representation/commission agreement? This agreement if signed could make you liable for paying commission to your agent.

Refer back to your executed contracts for clarity and if necessary, contact a real estate attorney for help.

Good luck!

All the best,

Kat
1 vote
John Arendsen, Agent, Leucadia, CA
Sun Mar 9, 2014
I understood your question clearly and as I previously stated unless you had something in writing I don't see where the agent has any right to keep your deposit. This could be construed as both a legal and ethical issue. I'd pursue it just out of principle if it happened to me. You could start by contacting his/her broker. If that doesn't produce favorable results I'd contact the DRE and file a complaint with them. Something just rubs me the wrong way with this one.
1 vote
John Arendsen, Agent, Leucadia, CA
Sat Mar 8, 2014
I'm not an attorney but as an RE broker my instincts, common sense and experience tell me that unless you had a written agreement of some sort the RE agent shouldn't be entitled to any of your money.
1 vote
Thank you!~!!!
Flag Sat Mar 15, 2014
Awesome-thank you!!!
Flag Sat Mar 15, 2014
Bill Eckler, Agent, Venice, FL
Sat Mar 8, 2014
As most will tell you, professional fees are "negotiable!" With this said, one must be careful when negotiating fees because the lower the commission...the fewer the services one can expect in return. Remember the expression, "You get what you pay for..." Well this really applies in real estate and shouldn't be overlooked.

Important to keep in mind is the fact that by negotiating and cutting these fees you could be limiting the activity your listing receives. Agents viewing a property with 4% verses 6% commission will generally promote the 6% property before the 4%.

With this said, it's generally the going rate for the area that determines the amount of the commission. Make no mistake "cutting commission" may save you some money as a listing but may very well cost you money in the long run.

Consider your options carefully....

Bill
1 vote
John Arendsen, Agent, Leucadia, CA
Sun Mar 16, 2014
If his license has be suspended or revoked he shouldn't be with anyone selling RE or even representing himself as a licensed agent. If his broker is knowingly allowing him to participate in any level of RE under his brokerage he is cupable and should be reported and disaplined as well.

I can't imagine any licensed broker taking a chance at losing their license, however. If this agent negotiated any type of RE transaction with you on a suspended and/or revoked license he could be guilty of a crime and be prosecuted and thrown in jail which is exactly where he belongs.

What he did to you is grand larceny. You shouldn't let this pass. If he doesn't refund 100% of your deposit I wouldn't hesitate to file a complaint with the DA
0 votes
mia, Home Seller, Los Angeles, CA
Sat Mar 15, 2014
thank you so much for all of your answers and support. I have finally, after 15 months reported it to the Real Estate Commission and his license is suspended or revoked. (not sure)

Last week offered me "$800 for your (my) troubles" while he owes me $2,000.. And you are right! He owed it to the landlord and she would have given it to me!

Too nice and far too optimistic. Hopefully, very hopefully he will not be able to do this to anyone else, again. Thank you all. This has been incredibly helpful!!!
0 votes
mia, Home Seller, Los Angeles, CA
Sat Mar 8, 2014
I'm sorry-I must have been unclear-because everyone read the same thing. My agent to me not to pursue. The other side was apologetic and immediately returned my deposit.
My agent, was leaving in vacation and promised to refund on return (2 weeks)
After requesting in writing, email and phone calls, has never done so.
Suddenly, he states that he owes nothing. This isn't a legal question, nor will the answers be used as such. Am just curious if this seems common as I have never heard if anything like this.
Thank you do your input.
0 votes
mia, Home Seller, Los Angeles, CA
Sat Mar 8, 2014
I'm sorry-I must have been unclear-because everyone read the same thing. My agent to me not to pursue. The other side was apologetic and immediately returned my deposit.
My agent, was leaving in vacation and promised to refund on return (2 weeks)
After requesting in writing, email and phone calls, has never done so.
Suddenly, he states that he owes nothing. This isn't a legal question, nor will the answers be used as such. Am just curious if this seems common as I have never heard if anything like this.
Thank you do your input.
0 votes
Suzanne MacD…, Agent, Morristown, NJ
Sat Mar 8, 2014
At first blush I would say no. Have you tried contacting this agent's broker? I would. Perhaps there is some sort of communication issue or the money is being held up for some reason you are not aware of. Talk to their broker and see if it can't be straightened out.
0 votes
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