First, did you sign anything that says you have to pay a $500 fee? If you agreed to it, there's not much to argue really, unless the fee is being charged in a way inconsistent with the commission laws. Even for a so called "admin fee", that is the highest I've heard of.
I shouldn't speak without knowing all the facts, but it sounds to me like your agent isn't being fair with you. Especially since any fee you would pay to your buyer agent is usually due at the time you settle on your chosen property.
We've gone with our agent to look at several properties and we've put in multiple offers with no luck the seller has always chosen a different offer. Just recently we put an offer in on a property and it was accepted. After looking at the inspection results...we've changed our minds on getting this property.
Our agent then asked us to pay $250 of the $500 "buyers agency fee."
I did some research on it and from my understanding the fee is paid between the buyer and the seller. is that correct?
Those who charge it will have a list of business costs that they say the extra commission is used to offset.
Those who don't charge the fee will tell you copies, faxes, and administrative costs are part of doing business, and they will not "nickle & dime" you for a couple hundred bucks on top of their agreed commission.
I hope my answer helps you.
1. A fee imposed due to the "clerical" work associated with a transaction. Someone has to prepare/fill out paperwork, file or enter information into a computer, and sometimes do some research depending on the situation. This fee is intended to cover the associated costs.
2. A fee imposed because someone wants to charge an extra fee.
If you are concerned, I would contact the entity that is charging you the fee, and ask them specifically what this fee is for.
Hope that helps!