Posted by DR on July 18, 2002 at 16:43:38:
GinBC,
That is totally unethical on the part of the Realtor. The seller would not be responsible for the commission difference between list price & sales price. Commissions are paid on the sales price only. The seller needs to report her Realtor to the local board. The Realtor is not looking after the sellers best interest, as is obvious from your description.
Can a Realtor do this? - Posted by GinBC
Posted by GinBC on July 18, 2002 at 16:17:21:
I was talking to a seller who has gone through 2 realtors and working on a third. She wants to get rid of the house as she has fallen ill with cancer and her tenants left her holding the bag for 3 months rent. House has been on the market for 5 months.
My estimate of the value is about 250,000 but it’s listed for 269,000. She has an existing mortgage of 180,000 and payments of 1300/mo.
The seller received an offer a few weeks ago of 240,000(one of 4 that have been made). She wanted to take it. She tells me that her realtor told her that if she accepted the offer, she would have to pay the realtor the difference in commision between it’s listing price and it’s selling price. The deal fell through.
My understanding is that Realtors get paid on the sales price not the listing price. I could understand this if there was not enough equity in the property but there’s about 50,000 there. Is this right?
Does it depend on the agreement with the Realtor?
Re: A Realtor can do - Posted by Ed Copp
Posted by Ed Copp on July 18, 2002 at 20:53:39:
whatever is agreed to in the listing contract, and yes it is a contract. Without having read the contract it would be impossible to know what it says. Legal advice should be left to the lawyers not the CRE chat board.
I would suggest that if the seller does not know what the contract says, (the one she signed) she should hire a lawyer to read it for her, and to her.
All that said the contract says what it says, not necessarily what I think it should say. The commission is negotiable, before it is agreed to not later. It is very possible that this contract calls for a non traditional commission rate. Might be that it even calls for a flat rate, real hard to tell without reading the documents. My crystal ball is broke down, and in the shop so if you need a lawyer hire one.