Posted by Vic on May 07, 2000 at 24:28:01:
Leslie,
The MLS does not determine the commission splits. Usually it’s the salesperson that has the listing that determines it, but I’m sure in most organizations, if a salesperson is going to do something radically different they must get the permission of their broker. The broker is the one who has the final say-so on what % of comm. is to be paid to cooperating broker. Usually though the broker will go along with salesperson so long as it makes sense. I’ve had listings where I’ve not done 50-50 splits, so if you see that, just know that the listing broker (or salesperson with broker’s permission) determines the split.
Vic
Commissions and Unfair Practices - Posted by T Jent
Posted by T Jent on May 06, 2000 at 24:38:53:
I have a question for brokers out there. When I, as a BROKER/PRINCIPLE, make an offer on a property advertised on the MLS, where the “commission to selling office” is stated as required (e.g. 3%), can the seller refuse to give me the commission just because I, a broker, am representing myself in the transaction?
I recently bid on an REO property held by B of A. The selling broker told me point blank that “B of A never pays a commission to a buyer who happens to be a broker representing themself.” As a Realtor and MLS member, it is my understanding of the MLS that to advertise a property on the MLS is to agree to pay a commission split to the “selling office.” That’s the whole point of the MLS i.e for sellers to split their commission in return for gaining maximum exposure to (brokers representing) potential buyers.
I have never before had a problem getting my commission when I buy. Clearly, I could just pay someone a nominal fee to represent me on the contract, and the seller would pay the same. Annoyed, I called the CA Dept of Real Estate legal line to inquire. They were unable to give me a straight answer to what seems a rather elementary question.
Any brokers have a clue?? Thanks in advance.
Re: Commissions and Unfair Practices - Posted by Soraya
Posted by Soraya on May 06, 2000 at 22:07:29:
Why not form a corporation that is owned primarily by you and have the corporation buy the property and you represent the buyer to get your commission.
Or if you are a broker, is there a duty to disclose that you have a special relationship to the buyer corporation? I can see having to disclose that you have a special relationship with the buyer (corporation) to an unsophisticated seller but not the REO dept of a lender. They can take care of themselves. (My dad’s a broker but he is out of town so I couldn’t ask him that question.)
Soraya
Re: Commissions and Unfair Practices - Posted by Charles
Posted by Charles on May 06, 2000 at 15:12:15:
The agent that told you that B of A doesn’t pay the a commission to a buyer who happens to be a real estate agent is correct. No seller does. They pay the listing broker and he pays the selling broker. The 3% in the MLS is offered by the listing office not the seller and they are the ones obligated to pay you. That is how it is set up but of course this info won’t get you the property.
Re: Commissions and Unfair Practices - Posted by Rob FL
Posted by Rob FL on May 06, 2000 at 10:25:41:
Unless there is something weird in the CA law or the MLS agreement or the actual listing agreement between the seller in this particular broker, you should receive a commission on this. I have done this plenty of times here in FL.
One easy way around this is simply to make the buyer a corporate or trust type entity. Your brokerage would represent this entity as a buyer’s broker. You can disclose in the fine print of your buyer’s contract addendum that one of its principals is a licensed broker, but you don’t have to say what that person’s name is.
XYZ Inc. is the buyer who is represnted by ABC Brokerage Inc. Both of which you own. Very easy to do.
Re: Commissions and Unfair Practices - Posted by Steve C., Houston-Remax
Posted by Steve C., Houston-Remax on May 06, 2000 at 08:57:25:
I would ask the listing agent if the listing agreement specifically states that agent/buyers are not to be paid, and to prove it in writing. Otherwise, the showing notes on the MLS should somehow indicate that this is the case. If not, they should pay you the stated fee as a buyers agent. (My opinion.)
Re: Commissions and Unfair Practices - Posted by SCook85
Posted by SCook85 on May 06, 2000 at 08:20:25:
This is very similar to my response below. The seller can accept whatever offer they feel like. They call the shots and the listing agent has to accept what they ask for. It is common for banks to request something like that. It was done to prevent insider buying and to make sure that the homes were marketed to the general public. Keep in mind that the banks really have no idea of what is going on in the marketplace. Unless you are planning on using your comission toward closing costs or something I would just submit a lower offer to compensate for the commision or have the bank contribute money back to me at settlement. One way or another I’d get the money out of them.
Steve Cook
Re: Commissions and Unfair Practices - Posted by Bill K. - FL
Posted by Bill K. - FL on May 06, 2000 at 07:20:13:
I also see this on bank reo listings spelled out in the remarks section. I don’t claim to understand the thinking behind it, however it immediately gives me a negative feeling about the deal. In my exp. most of those reos are not suitable to wholesale or retail anyway, so it is a moot point for me.
Re: Commissions and Unfair Practices - Posted by leslie
Posted by leslie on May 06, 2000 at 02:17:03:
i imagine they are saying the commision is negotiable, and here is fair warning yours will be net 0.
so now they expect you to take it off the offered price.
they look at the net anyway.
are you saying the mls policy determins the comm split? i see lots of splits spelled out other than 50/50.
leslie