Posted by stan on June 30, 2007 at 08:04:30:
He has a contract acting as the buyer’s agent
Buyer wants to screw broker - Posted by Ed
Posted by Ed on June 29, 2007 at 17:07:04:
Buyer wants to screw broker out of 3% commission.
Buyer contacted lender and seller to deal directly with him amd not to deal with Broker. Broker was the procuring cause for getting the deal from seller and got buyer the lender who is ready to fund the deal.
Broker has a signed buyer broker agreement specifying 3% commission.
Quite a non-professional buyer.
What should broker do?
1- Take buyer to court, or
2- Contact both seller and lender to ratify his
commission?
3- Cancel the deal
Thanks for you response.
Ed
Re: Buyer wants to screw broker - Posted by Dave
Posted by Dave on July 01, 2007 at 08:07:23:
Hi Ed
Just turn your Sign contract into the title company/attorney and let them handle it you’ll be paid you 3% from the seller’s side of the hud-1 settlements
Re: Buyer wants to screw broker - Posted by Ed
Posted by Ed on June 30, 2007 at 16:33:03:
Thank you all.
Broker attorney sent a letter to escrow co. to add to settlement documents broker’s commission. A copy was sent to seller and lender. Same letter was sent to buyer informing him that he will be liable to 3% commission and all brokers costs and legal fees if matter was not settled professionally and ethically.
Thanks again.
Ed
Re: Buyer wants to screw broker - Posted by Natalie-VA
Posted by Natalie-VA on June 30, 2007 at 11:42:58:
Make sure you fax your commission agreement to the settlement agent’s office so that they can put it on the settlement statement. See if that helps.
–Natalie
Re: Buyer wants to screw broker - Posted by Rich-CA
Posted by Rich-CA on June 30, 2007 at 10:16:11:
I agree with Ed. There are two parts to this issue. First is the legal, which you cannot take action on until the contract is broken (I assume there is a Buyer’s Agency agreement in place). Actually, there is one thing you can do. You can have your attorney draft a letter to your client stating that you are aware of their discussions directly with the seller (I assume you introduced him to the seller in the first place) and that should he conclude the purchase on his own, under the contract he would still owe you the 3% and that if you need to pursue this on court, he will also owe you attorney’s fees. Sometime a letter “reminding” a person of their legal obligations is enough.
The second part is the ethical. Some of the responses here engage in what could charitably be called “flexible ethics”, which is nothing more than no ethics at all. The ethical thing to do would be for the buyer and seller to complete everything they agreed to do as evidenced by the contracts that have been signed.
We do resort to courts a lot more than in the “old days”, but as can be seen from these posts its mainly because we no longer have common ethics or morals that allow us to agree on our own. There is a significant portion of the population that thinks its OK to do whatever they want unless someone FORCES them to do otherwise. They have neither morals nor ethics in the “external code” sense of the terms. Don’t expect them to behave ethically or morally and you will not be disappointed.
Re: Buyer wants to screw broker - Posted by BTI
Posted by BTI on June 30, 2007 at 08:27:19:
Ed
From reading your post I’m assuming that 1. the subject property was not listed with anyone. 2. your buyer-broker agreement is not a wimpy useless piece of payer created on a napkin in the dark, but has buyer to pay all legal costs to enforce etc. 3. You did not write up an offer to be presented to seller. 4. buyer is a jerk who saw a chance to put the 3% in his pocket.
The only post I agree with so far is Jack’s. The seller has no contract of any kind with you and thus no obligation other then ethical.
The Lender again has no obligation to you legally, the borrower is his client. However, how much future business is this lender going to get from you versus this particular buyer.
Like Jack said until he commits the murder he can’t be charged with murder, so all you can do at this point is advise the buyer in writing that as soon as this deal closes you will be turning the matter over to your attorney and he will not only owe your fee (I don’t like the word commission) but all legal costs costs due to his breach.
Finally review your broker-buyer agreement. Mine had a escalation clause in the fee due to certain acts or conditions depending on the circumstance of the deal.
I have only had to sue for fees for my agents or me 5 times in my life but we won all five times and having that judgement hanging over their heads, earning interest and watching the buyers or sellers (3 sellers, 2 buyers) sweat when they needed my co-operation in the future was nice. Some on this site will tell you to forget it and get on with your life.
I can’t do that, maybe I could dismiss it for awhile but there would always be reminders that would cause me great discomfort over and over and over, so my mind is eased only if I attack and kill the barbarous intruders or die trying.
BTI
no agreement with buyer - Posted by acw
Posted by acw on June 30, 2007 at 05:39:25:
Is this a short sale? Why is buyer talking with the bank?
Also, Broker has no agreement with the buyer.
Re: Buyer wants to screw broker - Posted by Jack
Posted by Jack on June 29, 2007 at 19:59:47:
Broker can’t do anything until Buyer screws him over, after that happens, then he has no choice but to take byer to Court. And… I don’t agree with any of three prior posts.
Re: Buyer wants to screw broker - Posted by Sailor
Posted by Sailor on June 29, 2007 at 19:52:47:
I think a lot of things that end up in court should have been settled over a cup of coffee & a plate of chocolate chip cookies–
Tye
Re: Buyer wants to screw broker - Posted by gerald(tx)
Posted by gerald(tx) on June 29, 2007 at 18:45:58:
Another thing would be to send to the seller by registered mail, a copy of the commission agreement with the buyer, noting his fraudulent intentions.
Explain that you will pursue legal action to obtain your commission, that with this notification, you the seller, will be a willing accomplice in this fraud, and thereby a co-defendant in the suit.
The seller will probably insist that you get paid if the deal is to go through.
Re: Buyer wants to screw broker - Posted by george
Posted by george on June 29, 2007 at 17:56:12:
Create and record in the courthouse, the appropriate documentation (for your state) which will cloud the title.
Notify the title company of the situation. They will not close or insure until the situation is remedied. The buyer will usually come across with the commission.