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Signed a buyer's agenct agreement and found a FSBO on my own; subsequently viewed it with agent.

Seller refuses to pay commission to agent, as do I.  Adding seller's concession to market value price of home will make it difficult to get an appraisal to come in that high.  Contract states a 3% commission.  What are my options?
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July 24 2009 - Saint Clair Shores
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Answers (9)

@wetdawgs - lol. How in the world to these end up at the top for people to answer? This is so funny!

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June 26 2011
How this works really depends on the state you're in.  In MA, an agent is responsible for negotiating the commission with the FSBO seller before showing the home.  If I had a client interested in pursuing a FSBO and they went and saw the property on their own without me, tough luck for me and great for the buyer.  I'll still put them in touch with great people to work with, but my work at that point is done. 

If the FSBO seller refuses to pay me, then I'd tell my client that and let them make the decision on how they want to move forward.  I'm a big believer in "do no harm", so no way I'd come after them for a commission.  As agents, we should never "get in the way" of people wishing to buy a home.  We can offer advice, based on our experience, and allow the buyer to make the decision that is best for them.  If you do that, you'll make out well in the long run.  If you focus on obtaining the commission, your real estate career will be short lived.

So, long story short, if the agent didn't negotiate the commission with the FSBO seller in advance, then he/she probably has little ground to stand on.  Also, if you found the property on your own without the agent, then the agent wasn't the procuring cause and really has no grounds to demand a commission.  You should consult a real estate attorney as laws in MI may be different than in MA. Remember, I'm not an attorney, so I cannot give legal advice...what I wrote is my opinion.
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June 26 2011
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I do hope the original poster figured out the right thing to do in the two years since he/she posted!
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June 26 2011
In Arizona, it's not necessary for the buyer to enter into an agreement with a broker. I offer to represent buyers without an agreement and operate on the faith that they will want to work with me on the homes that I email to them. If the buyer prefers to have an agreement, I only obligate them to work with me on homes that I email to them.

At their option, they can involve me on FSBO purchases. In those instances, I include the provision that the offer includes my commission (half of what might be charged when listed by a broker) which will be paid to me at close of escrow from the seller's proceeds.

In your case, you've involved your broker; and it doesn't make sense for the seller not to pay a commission to your broker as long as they are netting their bottom line.
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June 26 2011
I work as a buyers agent in both Key West Florida and Grand Junction Colorado. In my state buyer broker agreement it is clearly written and I also explain to my buyers that I sell all properties.... be it a MLS listing, an expired listing that I revived, a property that I found for them or a For Sale By Owner. I also tell them if I can not negotiate my commission I am not worthy of getting one. I have never been stiffed a commission from a FSBO owner. As a buyer's agent for many years I realize that buyers want to see it all, have the feeling that they have made the best purchase. I give them that experience.  
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June 26 2011
The  home owner pays the commission to the agent not the buyer. you should have told your agent about the fsbo and had he or she contact the fsbo to show you the home. Not to many  FSBO's who would not pay a buyers agent commission.  But since you went the other route if seller will not pay you will. sorry but i hope your agnt explained what the agency agreement was, It is in place to protect us from this very thing.

If  you did use your agent they probably  could have got you a better price on the home. It is a buyers market and if
"Adding seller's concession to market value price of home will make it difficult to get an appraisal to come in that high." THEN YOU ARE PAYING TO MUCH FOR THE HOME

a GOOD Agent is always the smart way to go FSBO are 99% over priced thats why they do not like to list with an agent.

just my thought's Good luck with your purchase
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December 07 2009
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To clarify - I signed contract when making an offer on a home prior to FSBO.  Original offer wasn't accepted so search continued and that's when I found the FSBO property.
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July 24 2009
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why did you have your agent show you a house if you didn't want to pay your agent commission on it? He doesn't work for free.
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July 24 2009
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If you signed a buyer's agent agreement, you are responsible for the obligations under the agreement.  
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July 24 2009
 
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