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- ConnieK_Oklahoma
- Contributions:2899
Cindy FYI. http://momtech.hubpages.com/hub/So-you-wanna-be-a-Real-Estate-Agent
- ConnieK_Oklahoma
- Contributions:2899
Cindy,
here in OK, Agents purchasing a personal home can still get their part of the commission even if they are the buyer. There are some times that we will see a notice in the MLS (I'm no longer amember) that says "seller will not pay a commission to broker buying for person use or investment use" but it's rare and usually only seen on specific REOs.
sometimes agents will use this as a bargaining point to get seller concession on closing costs instead of commission however that might not sit well with the selling agent's office as they tend to want their part of the commission split since they are taking on liability in the transaction. there are different rules at different offices about what agents are not supposed to do and there are MLS rules- most of those are regarding the sale of one's personal property rather than the purchase.
it's not worth it to get your license just for this, between the cost of getting started and then the delay for the OSBI background check- you'd likely be out more time and money. You can't get licensed until that background check is done. I can't speak to how long that takes- I didn't have to do it for my license years ago, but when I got my conceal carry permit a few years ago it was at least 6 months before that was done. I think the one for a licensee is less involved and cheaper but still...it's not quick.
you'd spend more in time and money than you'll save unless you plan on buying a lot of property.
the 184 program is a great program. I've had a few closings on that and am so impressed at how well it went each time. good luck to you.
here in OK, Agents purchasing a personal home can still get their part of the commission even if they are the buyer. There are some times that we will see a notice in the MLS (I'm no longer amember) that says "seller will not pay a commission to broker buying for person use or investment use" but it's rare and usually only seen on specific REOs.
sometimes agents will use this as a bargaining point to get seller concession on closing costs instead of commission however that might not sit well with the selling agent's office as they tend to want their part of the commission split since they are taking on liability in the transaction. there are different rules at different offices about what agents are not supposed to do and there are MLS rules- most of those are regarding the sale of one's personal property rather than the purchase.
it's not worth it to get your license just for this, between the cost of getting started and then the delay for the OSBI background check- you'd likely be out more time and money. You can't get licensed until that background check is done. I can't speak to how long that takes- I didn't have to do it for my license years ago, but when I got my conceal carry permit a few years ago it was at least 6 months before that was done. I think the one for a licensee is less involved and cheaper but still...it's not quick.
you'd spend more in time and money than you'll save unless you plan on buying a lot of property.
the 184 program is a great program. I've had a few closings on that and am so impressed at how well it went each time. good luck to you.
- Mack McCoy
- Contributions:1114
Hamp, sometimes we have to cover for each other on the blue line!
- Cindy Quinton, "Cindy Quinton"
- Contributions:1321
We would basically be buying based on my husband's credit and lengthy employment anyway. He is also a Native American and we hope to get a section 184 loan. I really don't add anything to the mix financially. I'm suspicious he keeps me around because I cook...
- Hamp Yonce, "Zilluminati"
- Contributions:3463
They have to find a willing source, and usually, undergo some extra scrutiny. If their spouse has a real job, it helps. The prejudice is a post 2007 phenom, and may have subsided somewhat since then. It also may have been a mostly wholesale rule, meaning a Mtg Broker couldn't do a loan for a REA through certain Lenders, but the Lender's retail folks could. Too many cooks in the kitchen theory.
- Cindy Quinton, "Cindy Quinton"
- Contributions:1321
Thank you, gentlemen. I was just thinking out loud, and to be honest I wouldn't consider licensing unless I intended to pursue a career.
@Hamp- What do realtors who wish to purchase a personal home do about a mortgage?
(apologies for the thread hijacking)
@Hamp- What do realtors who wish to purchase a personal home do about a mortgage?
(apologies for the thread hijacking)
- Hamp Yonce, "Zilluminati"
- Contributions:3463
There is all that, too. Nice catch, Mack. I had clocked out, a little bit.
- Mack McCoy
- Contributions:1114
Not in most states, Cindy. I thought this was nationwide, that commissions are not paid to the agent, they're paid to the brokerage. So you'd have to sign up with a brokerage, work out a deal with them; you'd probably have to join the local MLS because in at least most areas, co-brokerage agreements are only between MLS members.
The brokerage is responsible for the actions of their agents, so they'd probably require a decent cut of the first few deals a new agent would do, especially if they had an attorney involved!
Then, the buyer/agent would have to disclose to the Seller that they were a licensee, which isn't always a good negotiating point to start with. Could be, but sometimes isn't.
The brokerage is responsible for the actions of their agents, so they'd probably require a decent cut of the first few deals a new agent would do, especially if they had an attorney involved!
Then, the buyer/agent would have to disclose to the Seller that they were a licensee, which isn't always a good negotiating point to start with. Could be, but sometimes isn't.
- Hamp Yonce, "Zilluminati"
- Contributions:3463
- Cindy Quinton, "Cindy Quinton"
- Contributions:1321
Sooooo, theoretically could someone spend a couple of nights a week for six weeks at real estate school and then pass the test and represent themselves in their own house hunt? Then if they buy a house they would recieve the 3%?
- Hamp Yonce, "Zilluminati"
- Contributions:3463
Toby,
You need to inform your Loan Officer about the rebate ASAP, to make sure it gets handled correctly. If the loan folks are obseving the fact that the rebate will transpire, you may not need to enlist an Attorney, just for that. If it is on the loan docs, closing instructions, etc... it will get done, or nothing will get done. It weirds some Lender's out, be ready.
Also, you've found a generous, and hopefully genuine, REA type. If it works out well he deserves referrals. Fingers crossed.
You need to inform your Loan Officer about the rebate ASAP, to make sure it gets handled correctly. If the loan folks are obseving the fact that the rebate will transpire, you may not need to enlist an Attorney, just for that. If it is on the loan docs, closing instructions, etc... it will get done, or nothing will get done. It weirds some Lender's out, be ready.
Also, you've found a generous, and hopefully genuine, REA type. If it works out well he deserves referrals. Fingers crossed.
- Toby Emmanuel, "temmanuel"
- Contributions:12
@Mark: I had to look up what Audubon was, but you got a deal!
- Mack McCoy
- Contributions:1114
Why don't you give $25 to your local Audubon society and we'll call it good!
- Toby Emmanuel, "temmanuel"
- Contributions:12
hpvanc, Mack and Hamp: You raised a very valid point regarding procuring cause and I do not want to risk it. I talked to my Buyer agent and we have agreed a 82.5% for me and 17.5% for him of the Buyer Broker Commission. I will have my attorney review the contract once I have it. In the mean time, I will ensure that the Buyer Agent opens the door!
I should buy you guys a drink already!
I should buy you guys a drink already!
- Hamp Yonce, "Zilluminati"
- Contributions:3463
I was definitely assuming that six instances of "door opening" would be included in the four grand. I could be wrong. I am an unethical litter box of a man, with very few redeeming qualities.
Here's my theme song!
Here's my theme song!
- Rita A. Walker, "Rita Walker"
- Contributions:277
Good Luck!!
- Mack McCoy
- Contributions:1114
Tony, I know that, and I apologize, as many times the agents here are having two conversations going simultaneously.
The part that I preface with something to the effect of, "my expert thought," is directed at you. Some of the other stuff is directed at previous posters.
hpvanc raises a good point; the standard for a Realtor® to be procuring cause is pretty much to write up the deal; in some areas, whichever non-Realtor® first opens the door might be considered "procuring cause," and be owed a commission.
To Hamp's point, I don't know. My guess is that the Seller has a right to request that all offers are on standard forms and that their agent represents only them; I'm not sure that the listing broker can demand that the buyer do anything . . .
The part that I preface with something to the effect of, "my expert thought," is directed at you. Some of the other stuff is directed at previous posters.
hpvanc raises a good point; the standard for a Realtor® to be procuring cause is pretty much to write up the deal; in some areas, whichever non-Realtor® first opens the door might be considered "procuring cause," and be owed a commission.
To Hamp's point, I don't know. My guess is that the Seller has a right to request that all offers are on standard forms and that their agent represents only them; I'm not sure that the listing broker can demand that the buyer do anything . . .
- hpvanc
- Contributions:2570
Just one question. If you get the listing broker to show the property, will the listing broker claim procuring cause and try to keep the full commission? I would make sure you are contractually covered on that front before getting the listing agent to show the property.
It may be simpler to pay your buyers agent for showings than to risk having the listing agent claim procuring cause.
Good luck.
It may be simpler to pay your buyers agent for showings than to risk having the listing agent claim procuring cause.
Good luck.
- Toby Emmanuel, "temmanuel"
- Contributions:12
@Hamp: Maybe I should pay you to be my adviser! Thanks for all the tips. I will keep you updated.
- Hamp Yonce, "Zilluminati"
- Contributions:3463
This is theoretically sound, but practically difficult.
Ain't that the truth. I'd say it is theoretically feasible, but practically, and cost effectively, with any degree of certitude, impossible. With method number 1, by trying to simplify the process, from your POV, you'd actually be complicating the process from the POV of all other parties. These also happen to be the parties, that control the transaction, rightly or wrongly (I'd argue, rightly).
You're now trying to do it the practical way. I hope it goes well. Good luck. Keeps us posted. A play by play would be fun. Negotiate hard. The Seller can pay up to 6% "assist", if you're putting 20% down.
Ain't that the truth. I'd say it is theoretically feasible, but practically, and cost effectively, with any degree of certitude, impossible. With method number 1, by trying to simplify the process, from your POV, you'd actually be complicating the process from the POV of all other parties. These also happen to be the parties, that control the transaction, rightly or wrongly (I'd argue, rightly).
You're now trying to do it the practical way. I hope it goes well. Good luck. Keeps us posted. A play by play would be fun. Negotiate hard. The Seller can pay up to 6% "assist", if you're putting 20% down.
- Toby Emmanuel, "temmanuel"
- Contributions:12
@Hamp: Thanks, you did tell me. It is funny the way this is turning out.
My options are:
1. Get the Seller Agent to give 3% commission to Seller and get it back as Seller's assistance. This is theoretically sound, but practically difficult.
2. Go for dual agency with Seller Agent and get 2-3% buyer rebate on HUD. I will have to deal with each of the Seller Agent and again a hassle.
3. Get a Buyer Agent to do minimal work for .5% and give 2 to 2.5% as Buyer Rebate on HUD. This is what I am doing now.
When I talked to the Buyer Agent, initially he was like, not a problem, you can get that as Seller's Assistance when I asked for Buyer's Rebate. When I told him that if he does not understand the difference between Seller's Assistance and Buyer's rebate, we need not talk, he changed the tone in an instant and agreed to my demands.
Since he already tried this with me, I have to make sure that I get my real estate attorney involved and check each document before I sign anything to ensure that I get the Buyer Rebate. I need to ensure that the Buyer Rebate is mentioned in the contract I submit to Seller.
Also, my Lender told me to make sure that the Lender's closing agent is mentioned in the Contract and that if I use their agent, they will waive most of the closing costs for me. So I need to take care of that aspect as well.
This is tricky, but if I put in the effort and handle this well, I would save some serious money.
My options are:
1. Get the Seller Agent to give 3% commission to Seller and get it back as Seller's assistance. This is theoretically sound, but practically difficult.
2. Go for dual agency with Seller Agent and get 2-3% buyer rebate on HUD. I will have to deal with each of the Seller Agent and again a hassle.
3. Get a Buyer Agent to do minimal work for .5% and give 2 to 2.5% as Buyer Rebate on HUD. This is what I am doing now.
When I talked to the Buyer Agent, initially he was like, not a problem, you can get that as Seller's Assistance when I asked for Buyer's Rebate. When I told him that if he does not understand the difference between Seller's Assistance and Buyer's rebate, we need not talk, he changed the tone in an instant and agreed to my demands.
Since he already tried this with me, I have to make sure that I get my real estate attorney involved and check each document before I sign anything to ensure that I get the Buyer Rebate. I need to ensure that the Buyer Rebate is mentioned in the contract I submit to Seller.
Also, my Lender told me to make sure that the Lender's closing agent is mentioned in the Contract and that if I use their agent, they will waive most of the closing costs for me. So I need to take care of that aspect as well.
This is tricky, but if I put in the effort and handle this well, I would save some serious money.
- Hamp Yonce, "Zilluminati"
- Contributions:3463
See, I told you.
We all know that Brokers can "voluntarily" rebate part of their commission to their clients. They can't be made to. Not even by the Seller, during PC negotiations, really. Not because of clever negotiation tactics, or any other newfangled thinking.
Now, Toby needs to try to do what he said, and not expect things from his discount Buyers Agent, that he claimed he didn't want, or need. That's where the fun intervenes. To remain purely ethical, Toby needs to not even "let" his Buyer's Agent do things he said he didn't want or need, even if the BA volunteers.
Toby, Just to be clear. Did the new Buyers Agent guy force you to use him? Because I read elsewhere on Zillow that you were being forced to use a Buyers Agent. Did I force you to hire this guy? Did I cause you think about your options?
Thumbs up to Mack McCoy for elucidating the facts regarding whose money the commission is. I also have an interesting question for the peanut gallery. Does the Seller, and his Agent, have a right to require that the Buyer have an Agent, and that the Agent get paid his full commission split per the Listing Arrangement?
We all know that Brokers can "voluntarily" rebate part of their commission to their clients. They can't be made to. Not even by the Seller, during PC negotiations, really. Not because of clever negotiation tactics, or any other newfangled thinking.
Now, Toby needs to try to do what he said, and not expect things from his discount Buyers Agent, that he claimed he didn't want, or need. That's where the fun intervenes. To remain purely ethical, Toby needs to not even "let" his Buyer's Agent do things he said he didn't want or need, even if the BA volunteers.
Toby, Just to be clear. Did the new Buyers Agent guy force you to use him? Because I read elsewhere on Zillow that you were being forced to use a Buyers Agent. Did I force you to hire this guy? Did I cause you think about your options?
Thumbs up to Mack McCoy for elucidating the facts regarding whose money the commission is. I also have an interesting question for the peanut gallery. Does the Seller, and his Agent, have a right to require that the Buyer have an Agent, and that the Agent get paid his full commission split per the Listing Arrangement?
- Toby Emmanuel, "temmanuel"
- Contributions:12
@Mark McCoy: I talked to a Buyers Agent and he has agreed to work for me for $4000 flat fee. The rest of the commission will be given to me as Buyers Rebate, which is legal in PA as per DoJ.
May a real estate agent rebate a portion of the agent's commission to the borrower? If so, how should the rebate be listed on the HUD-1?
According to HUD, yes, real estate agents may rebate a portion of the agent's commission to the borrower in a real estate transaction. The rebate must be listed as a credit on page 1 of the HUD-1 in Lines 204-209 and the name of the party giving the credit must be identified. Real estate agent or broker commission rebates to borrowers do not violate Section 8 of RESPA as long as no part of the commission rebate is tied to a referral of business.
- Mack McCoy
- Contributions:1114
Sure, hpvanc, aren't we all.
There's this idea going around that the real estate brokerage fee is somehow just sitting on the table, ready to be scooped up by whoever is most assertive, and while that sometimes might be the case, it often isn't.
My expert thought on this is that the entire brokerage fee belongs to the listing brokerage. Toby - every buyer - finds out about a property some how, some way, almost always from the efforts of the listing brokerage (the co-brokerage doesn't put the signs out, for example). The contract with the seller is that the seller will pay the entire brokerage fee when the listing brokerage has done its job - bring a buyer and close the transaction.
What I'm missing from this is how any part of the brokerage fee should become the buyer's or the seller's?
There's this idea going around that the real estate brokerage fee is somehow just sitting on the table, ready to be scooped up by whoever is most assertive, and while that sometimes might be the case, it often isn't.
My expert thought on this is that the entire brokerage fee belongs to the listing brokerage. Toby - every buyer - finds out about a property some how, some way, almost always from the efforts of the listing brokerage (the co-brokerage doesn't put the signs out, for example). The contract with the seller is that the seller will pay the entire brokerage fee when the listing brokerage has done its job - bring a buyer and close the transaction.
What I'm missing from this is how any part of the brokerage fee should become the buyer's or the seller's?
- Toby Emmanuel, "temmanuel"
- Contributions:12
Hamp Yonce, "Zilluminati": If an agent will give me 1.5% rebate, I will use that agent. But I cannot seem to find such an agent.
Mack McCoy: I am not saying I will take one of the six properties based on the deal. I know the factors that go into my decision, and price is a major factor of that. I would be making the decision considering all the factors. But I am pragmatic enough not to look for a "dream" house.
Brian Teyssier, "Brian Teyssier GRI" I have used attorneys to buy and sell, they have typically charged me 0.1 to 0.4% of the transaction. I have already talked to a real estate attorney and got a flat rate fee.
awangpro: Thanks for the advice, that is exactly one of the scenarios I am thinking of. Let me see if that would work out. If they would offer me a rebate of 1.5%, that is easier for me.
Drew Ludlow, "DrewLudlow": I do not care how much a realtor or anyone makes. I do not want to use a Buyer Agent since I am not planning to use the services provided by him. Even though the Seller pays the Buyer Agent, the money ultimately comes from me. Since I am not consuming the services provided by a Buyer Agent, I do not want to pay for it. Please don't be upset with the way I want to spend my money.
hpvanc: Thanks for your support! All the Seller Agents I talked to are more than happy to show me the property themselves, negating the need to use an agent to get access to inspect the properties.
Mack McCoy: I am not saying I will take one of the six properties based on the deal. I know the factors that go into my decision, and price is a major factor of that. I would be making the decision considering all the factors. But I am pragmatic enough not to look for a "dream" house.
Brian Teyssier, "Brian Teyssier GRI" I have used attorneys to buy and sell, they have typically charged me 0.1 to 0.4% of the transaction. I have already talked to a real estate attorney and got a flat rate fee.
awangpro: Thanks for the advice, that is exactly one of the scenarios I am thinking of. Let me see if that would work out. If they would offer me a rebate of 1.5%, that is easier for me.
Drew Ludlow, "DrewLudlow": I do not care how much a realtor or anyone makes. I do not want to use a Buyer Agent since I am not planning to use the services provided by him. Even though the Seller pays the Buyer Agent, the money ultimately comes from me. Since I am not consuming the services provided by a Buyer Agent, I do not want to pay for it. Please don't be upset with the way I want to spend my money.
hpvanc: Thanks for your support! All the Seller Agents I talked to are more than happy to show me the property themselves, negating the need to use an agent to get access to inspect the properties.
- hpvanc
- Contributions:2570
Drew,
Have you considered that what Toby is trying to do is not pay for a service they would prefer not to use? It's not what the agent makes, but whether the buyer wants to use and has the option of not using the services of an agent. Toby would prefer per his posts, to handle some aspects of the transaction on his own and hire an attorney for the remaining services. The only item I can think of that he has to use an agent for is access to inspect the properties.
Have you considered that what Toby is trying to do is not pay for a service they would prefer not to use? It's not what the agent makes, but whether the buyer wants to use and has the option of not using the services of an agent. Toby would prefer per his posts, to handle some aspects of the transaction on his own and hire an attorney for the remaining services. The only item I can think of that he has to use an agent for is access to inspect the properties.
- Drew Ludlow, "DrewLudlow"
- Contributions:505
And of course, this is all predicated on the fact that each and every listing agent has a 6% listing. Many have 4%-5%, and some have a flat fee of a couple thousand.
Good luck in your approach, but I think you will be short changing yourself by picking the home where the agent lies down for you.
Shouldn't you pick the home thats right for you instead of worrying so much about sticking your hands in someone's pocket?
Personally, I would be happy to give you 3% of my commission - if you give me a few weeks' worth of your salary.
Why is everyone so concerned with how much The Realtor makes?
- awangpro
- Contributions:1
I have bought real estate in exactly same scenario by approaching the Listing Firm directly and bypassing a buyer's agent. One way to sweeten the offer is to offer the listing broker another 1 to 1.5%, resulting you the buyer getting 2 or 1.5% of the total commission.
Most agents are insanely protective of their commissions as you can see from many of the posts above and will try to scare you away. However their commission structure will eventually go the way of stock brokers. They might argue against it. But in reality in the age of Internet and information transparency, they simply don't add as much value anymore.
I've even had one broker telling me that it's illegal. So I got a letter from my State's Department of Licensing stating otherwise.
Most agents are insanely protective of their commissions as you can see from many of the posts above and will try to scare you away. However their commission structure will eventually go the way of stock brokers. They might argue against it. But in reality in the age of Internet and information transparency, they simply don't add as much value anymore.
I've even had one broker telling me that it's illegal. So I got a letter from my State's Department of Licensing stating otherwise.
- Brian Teyssier, "Brian Teyssier GRI"
- Contributions:964
Hmmmm....a real estate attorney will charge less than 3%? I think 3% is a high commission for that price range anyway, usually it is closer to 2.5%.
- Mack McCoy
- Contributions:1114
Of course, everything would be cheaper if we could just "negotiate" the pesky costs out of the way.
What is missing from this discussion is why anyone thinks that Toby is right to go the seller's agent and renegotiate their contract? Do you go for an MRI and tell the head of the clinic, let me renegotiate the lease and keep the difference?
The listing agreements are generally pretty clear on what the brokerage earns and how; I'm not exactly sure why you would encourage somebody to interfere with that agreement, but I'm sure you will tell me.
One thing that only real estate agents seem to note is that the anticipated "extra" negotiating room may have nothing to do with getting the deal done.
At the end of this, I think we have a highly unusual buyer here - I don't think I've ever worked with a buyer who could choose from any of six properties and be happy with whichever deal they got.
What is missing from this discussion is why anyone thinks that Toby is right to go the seller's agent and renegotiate their contract? Do you go for an MRI and tell the head of the clinic, let me renegotiate the lease and keep the difference?
The listing agreements are generally pretty clear on what the brokerage earns and how; I'm not exactly sure why you would encourage somebody to interfere with that agreement, but I'm sure you will tell me.
One thing that only real estate agents seem to note is that the anticipated "extra" negotiating room may have nothing to do with getting the deal done.
At the end of this, I think we have a highly unusual buyer here - I don't think I've ever worked with a buyer who could choose from any of six properties and be happy with whichever deal they got.
Buy House without Buyer Agent
Along with the price, I plan to ask for the 3% that should have been paid to the buyer agent as Sellers Assistance. This should bring my purchase price down by another 3%. Instead of the seller agent acting as a dual agent, I plan to hire a real estate attorney to help me through the contract and closing process. I have 20% down payment and very good credit score and income and so the mortgage process would be simple. I am pre-approved. Please let me know your expert thoughts on this.
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