If I selling my home FSBO and an agent brings a buyer, how is the commission handled?

Asked by majeske, Los Angeles, CA Fri Apr 19, 2013

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31
Terry Farnsw…, Agent, Lisle, IL
Fri Apr 19, 2013
Most likely - the agent will contact you beforehand to ask if you are willing to cooperate in the form of some compensation (which can be negotiated), in return for bringing you a performing buyer.

Some FSBO's will say - "No, I won't pay you anything". Agents have no incentive or motivation to bring their buyers to these properties. There are plenty of other properties that offer compensation. In fact, the vast majority do. You would then be left to hopefully "get lucky", and sell your home to a very small majority of people who might happen to be unrepresented by an agent, and drive by your home.

Others who want to ultimately sell their home will agree to pay them something, negotiate a pre-determined amount, and get everything agreed to in writing in advance.

The bottom line is - refusing to cooperate with real estate agents eliminates a gigantic pool of potential buyers. This makes some people very angry - because they feel like they are then "forced" to pay commissions to get their home sold, and there are a lot of people out their who detest real estate agents. The reality is however, without a professional managing the transaction - there is a high potential of it turning into a huge mess.

Hope that helps!
3 votes
Spoken like a true broker.

Everything depends on the market. My area agents have over 300 buyers for a 3/2 and there are ZERO for sale. Sellers Market = Leverage.
Flag Mon May 27, 2013
Mark Fiechtn…, Agent, Watertown, SD
Fri Apr 19, 2013
There are several ways to handle this situation. One option is to work with the agent, and compensate them for their work. Another option is to have the buyer pay the commission to their agent. This should be agreed upon with you and the agent before any showings or contracts are put into motion. The agent doesn't need to represent you as the seller to be paid a commission, but should be compensated for their effort in selling your home.
2 votes
Leela Areeck…, Agent, LOS ANGELES, CA
Fri Apr 19, 2013
commission is negotiable. You
should pay what is deserved for that agent.
Leela Areeckal
2 votes
Al Goldberg, Agent, Beverly Hills, CA
Fri Apr 19, 2013
Aloha,

Commission is 100% negotiable due to state and federal law for the protection of the consumers.

I forgot to mention, in the past I have taken deeds of trust (loan notes) in a second or third position back for my commission if there is not enough cash in the deal, I have taken coins, collectables, furniture, artwork, cars, vans, and personal property as my commission. This is not done by any of the major national local chains I have worked for but because I own my own company I can do this.


I have buyers in the WLA area right now looking in your area of the 405 & Santa Monica to Olympic area.

If you already have a buyer I can do all the paperwork, and the hundred plus pages of disclosures that if you do wrong you may be liable for more than the value of your home. I also have errors and omissions insurance to cover any problems that might ever come up under the policy.

Thanks I look forward to meeting you at your house,or a Starbucks whichever fits more into your comfort zone. Be back from Hawaii Sunday lare afternoon and back at work Monday.

If you work M-F 9-5 we can meet Sunday at about 5-7 pm or later at my office in Beverly Hills, your house, or a Starbucks close by.

I am buying 5 properties here in Hawaii, and I am working, so don't hesitate to call me or text or email me when and where you want to meet Sunday. Please don't feel that you are interrupting my vacation, I am here working and only doing a little snorkeling & fishing. Let me buy you a cup of cofie or tea.

Mahalo

Al Goldberg Broker
ALYourBroker@yahoo.com
800-765-3609
34 Years Experience SInce I Was 21
2 votes
Sona Gallatin, Agent, Santa Clarita, CA
Fri Apr 19, 2013
Commission is completely negotiable between you and the agent. How long have you had your home on the market? have you been in escrow and had the deal fall out? Depending on how difficult or easy it's been for you, you already have a pretty good idea of the value of an agent bringing you a qualified buyer.

Good luck!!
2 votes
Walter 'Skip'…, Agent, Brea, CA
Fri Apr 19, 2013
Normally, a buyer's agent would not present an offer to a FSBO without first having the seller agree to pay (in writing) a commission. The exception would be that the buyer has agree to pay the agent a commission.
Good luck,
2 votes
Ron Thomas, Agent, Fresno, CA
Fri Apr 19, 2013
You will agree to pay the commission, or you will not get the Offer.
Simple nuh?

The Buyer will have guidance and protection, and you will have yourself.
2 votes
3% of the sales price for pointing out a home has baseboards? 3% for driving in your own neighborhood and seeing a sale sign on a lawn. No thanks. Real estate lawyers are about $300-$400 an hour. There are lots of for sale by owner sites on the internet. You aren't alone! The day of the parasitic middleman is coming to an end.
Flag Wed Jun 18, 2014
More scare tactics from an Agent. This is so common. Don't fall for it. In high demand areas with no inventory, buyers are climbing over each other to buy. They'll ditch their agent fast if it means they'll get the home.

Especially after missing out on the last 3 bidding wars.
Flag Mon May 27, 2013
, ,
Mon Jul 8, 2013
Great answers on this thread. Personally, I would recommend, even if you wanted to sell the property yourself, contacting a real estate professional to handle the paperwork for a predetermined amount. The disclosures and requirements are so very complex that a home seller can innocently put themselves at serious financial risk just through lack of knowledge.

Additonally, I would recommend any FSBO seller to work with a mortgage professional to cross qualify any offer they are considering accepting. The veracity of a preapproval letter is very crucial in determining whether a buyer can really qualify to purchase your home. Unfortunately, there are still far too many loan officers issuing prequalification letters without verifying any credit, income or assets of the potential buyer.

All my best,

Deborah
NMLS #279125
1 vote
Gail Mercedes…, Agent, Beverly Hills, CA
Mon Jul 8, 2013
Majeske,

I would be a written agreement between you and buyer's agent. Get the written agreement before home is shown. Agreement will state commission to buyer's agent, prospective buyer's full name and buyer's agent time period. Hopefully, this information helpful

Gail Mercedes Cole
Exp Realty
310.853.9933
1 vote
Brad Korb, Agent, Burbank, CA
Thu May 30, 2013
That would be what you negotiate with the agent ,hopefully you can agree with the agent on a fee before he or she shows your property . Good Luck !
1 vote
Kawain Payne, Agent, Seal Beach, CA
Tue May 28, 2013
You already have some good answers here. I agree most with Mark Fiechtner.


Best of luck to you!!!

Kawain Payne, Realtor
Prudential California Realty
1 vote
Leela Areeck…, Agent, LOS ANGELES, CA
Sat Apr 20, 2013
There is contract form where you sign for certain percentage of commission. The escrow company will also send you a form with commission amount. At close of escrow the escrow officer will disburse the proceeds to right parties.
Leela Areeckal
1 vote
Lee Fruchter, Agent, Glendale, CA
Fri Apr 19, 2013
First choose an escrow co. that can help you with a FSBO. You will need to enter a one party commission agreement with the buyer's agent.

Good luck,

Lee
1 vote
Emily Knell, Agent, Huntington Beach, CA
Fri Apr 19, 2013
There was a FSBO in my neighborhood in the past 9mos or so, FSBOs are very rare. Had the owner allowed me to work with them, I could have brought them an offer that would have NETTED them about $20-30K more even with commission vs what they ended up selling the house for & that price, did NOT help the neighborhood.

The statistic is this: With a Realtor you will sell at a price that is approx. 17% more than going at it alone.

So, even with a 5 or 6% commission being a factor, statistically you should net 11-12% more than trying to sell without a Realtor.

I can show the form that all the other agents are talking about: It's called a SINGLE PARTY COMPENSATION Agreement.

Just shoot me an email directly, I don't look back on this same Trulia posting for answers after mine.

Emily S. Knell
EmilyKnell1@yahoo.com
562-430-3053 c
Realtor Since 1996
Realty ONE Group
Serving LA & Orange Counties
1 vote
Dorene Slavi…, Agent, Torrance, CA
Fri Apr 19, 2013
Dear Majeske,
Normally if a Professional Realtor brings you a qualified buyer, you would pay the agent for helping you handle the paperwork and selling your property. You should discuss this In Advance so that there is no confusion.
1 vote
Billy Lam, Agent, San Marino, CA
Fri Apr 19, 2013
The fellow agents are correct about the real estate commission are negotiable. The commission is not set by any law and is negotiable between the seller and the buyer's agent who bring in a qualified buyer with an acceptable offer to the seller. Most buyer's agent receive a commission equal to 2.5% - 3% of the final accepted price and there are some agents that will accept a 2% commission. However, the buyer's agent may help the seller (FSBO) with preparing the seller's disclosures and reports but they may or may not represent the seller. You may opt to hire a real estate attorney or a licensed real estate agent to assist you with the paperwork for a small fee as one of the agent mentioned earlier.

My service caters to FSBO's and I can provide you my references from past FSBO's clients. You can reach me at (626) 552-2500 for further info regarding the FSBO services and fee.
1 vote
Leela Areeck…, Agent, LOS ANGELES, CA
Fri Apr 19, 2013
Hi,
Commission is negotiable. Also depend upon what type offer is acceptable to you.
Leela Areeeckal
1 vote
Caroline Har…, Agent, Northridge, CA
Fri Apr 19, 2013
FSBO sellers can negotiate a 2.5-3% commission for the buyer's side. If you already have the Buyer ready to go, I can help you get all the paperwork done for a small fee. Let me know.

__________________________
Sincerely,
Caroline Harabedian
Realtor
RE-Search Concept
8700 Reseda Blvd., Suite 213-B
Northridge, California 91324
(818) 967-9626 mobile
(818) 979-0226 fax
http://www.HomesByCaroline.net
caroline.wcli@gmail.com
1 vote
Cindy Davis, Agent, San Diego, CA
Fri Apr 19, 2013
Typically a seller pays the buyer's agent. The standard commission these days is about 2.5% - what you choose to pay is another matter - it is technically negotiable.

That said, if you do not offer to pay 2.5%, you may lose paying customers. Agents work hard for their commissions and don't feel as inclined to work with a seller who cuts it below normal rates.

Good luck.
1 vote
Clint Lohr, Agent, Glendale, CA
Fri Apr 19, 2013
If you really want to get your home sold, you must agree in writing to pay the agent at least 2.5% of the purchase price for all the time, paperwork, inspections, and negotiating the deal that the agent will put into this transaction. Otherwise, the agent will show his or her buyers another property where they will be paid 2.5% of the purchase price or more. The commission comes from the proceeds of the sale of your home.
If your home is not listed in the MLS, it will take way longer to sell unless you already have a buyer knocking your door down to buy it. And typically, the longer it takes to sell your home, the less it will sell for. Clint Lohr, Keller Williams World Media Center-- Burbank.
1 vote
Cheryll Dudl…, Agent, Beverly Hills, CA
Fri Apr 19, 2013
since it is customary for the seller to pay the buyer's commission, if the offer is one you want to accept, you should at least pay that part of the commission, usually 3%. Not only has that broker brought you the buyer s it is fair to pay that, but Selling property is a highly legal and complicated and best handled by a trained professional. You will get your money's worth.
1 vote
Careful not to actually put down a number here as commission is completely negotiable. Quoting a number here is not advised.
Flag Fri Apr 19, 2013
Ellie Salemn…, , Los Angeles, CA
Fri Apr 19, 2013
You can sell your house yourself but you need to provide the buyer a lot of disclosures which you might not know about. It is to the benefit of both buyer and seller to involve a knowledgeable agent .
If you need any help please let me know.
Ellie Salemnia
Elahehsal@yahoo.com
1 vote
Al Goldberg, Agent, Beverly Hills, CA
Fri Apr 19, 2013
Aloha,

I am in Hawaii today buying some real estate, but will be back in LA Monday.

Commission in the State of California is negotiable, and not fixed by law.

I have buyers for investment rentals and personal properties.

I would like to come over to your home and see it and discuss how the commissions work for a buyers broker.

Let me know when is good for you.

Mahalo

Al Goldberg Broker
ALYourBroker@yahoo.com
800-765-3609
1 vote
Richard Schu…, Agent, Los Angeles, CA
Fri Apr 19, 2013
You can negotiate a commission with the buyers agent. Can you message me the address? I ave a couple of clients looking in 90025.
1 vote
Bill Eckler, Agent, Venice, FL
Fri Apr 19, 2013
This is a good question.....before allowing the agent to show the property, there should be some sort of agreement. The best agreements are those committed to paper with the appropriate signatures.

Agreeing to a "one time showing" to a stated customer with an agreed commission rate would be a good way to go. A fair discounted fee for professional services would be in the 3-4 % range. Keep in mind that with no listing agent to take care of your paperwork, you will likely be relying on the agent with the customer to take care of all of the necessary documentation.

The agreed fee for professional services would be paid to the agent at closing and would come from the proceeds of the sale of the home.

Bill
1 vote
3-4%? No way. 1.5% can be found in the current Seller's markets. Recent shows that sellers paid over $30 billion more than they should of in fees to brokers.

Industry is changing. Be shrewd and negotiate down. Tons of buyers, no homes = more competition from agents to make any money at all.
Flag Mon May 27, 2013
Laura Feghali, Agent, Stamford, CT
Fri Apr 19, 2013
Hi,
I suggest that you should seriously consider offering a broker's commission to the buyer's agent firm in order for the buyer (who is working with a real estate agent) to seriously consider negotiating an offer for your home. Otherwise; the buyer will have to pay his agent's commission so would most likely offer less for your property knowing that he will have to pay this additional expense.

Best wishes!

Laura Feghali
Prudential Connecticut Realty
1 vote
Alex Khalili…, Agent, Woodland Hills, CA
Mon Mar 16, 2015
Everything in real estate is negotiable.

Please let me know if you have any other real estate-related questions!

Alex Khalilifard | Realtor - General Contractor
Listing and Selling Agent
RE/MAX
Alex@TopHomesLA.com
Direct: 818.925.8088
http://www.TopHomesLA.com
0 votes
Hector Reyes, Agent, Victorville, CA
Thu Jul 24, 2014
completely negotiable and how fast you want to sell it or you can sit on it and do it yourself with out agents but you will need to be an experience seller.
0 votes
Brad Korb, Agent, Burbank, CA
Sat Mar 1, 2014
Any way you want,you should work out an arrangement up front before the agent shows the property,usually the commission for a buyers agent would be 2.5-3 % . Good Luck !
0 votes
Brad Korb, Agent, Burbank, CA
Sat Mar 1, 2014
Any way you want,you should work out an arrangement up front before the agent shows the property,usually the commission for a buyers agent would be 2.5-3 % . Good Luck !
0 votes
Bruin Fan, Home Seller, Los Angeles, CA
Sat Mar 1, 2014
There are a lot of answers and if an agent brings you a buyer. It is reasonable for them to be paid for their efforts.
0 votes
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