Posted by Mike Daly (GA) on April 26, 2002 at 09:29:42:
I’d say it’s fine as long as you have the right the cancel the contract at your option. If the agent has a problem with that then move on.
Exclusive contract with Realtor - Posted by Ana
Posted by Ana on April 26, 2002 at 07:55:40:
Is it a good idea for a newbie to sign an exclusive contract with a Realtor? I’m not sure if tying myself up for 3-4 months would be a good idea, however there’s a lot I can learn with this person while the contract is valid…
Any pros and cons would be appreciated… Thanks!
Maybe - Posted by Ron (MD)
Posted by Ron (MD) on April 26, 2002 at 16:38:46:
Ana,
If the agent is a typical agent who deals primarily with owner/occupants and knows little about REI, I would not.
On the other hand, if the agent has significant expertise in REI and is willing to guide you (and you know from other RE investors that he is good), I think it’s a great way to get your feet wet.
Two caveats…most importantly, remember that most agents (yes, even buyers’ agents) have getting paid as their highest priority. They will tell you that they are there to look out for your interests, but they’re there for the same reason you are (i.e., to put money in their own pocket). This means that you have to learn as much as you can, but do not rely on anything you are told…it is your responsibility to look out for you. Don’t rely on his ARV (after repaired values)…look at the comps yourself. Don’t rely on his repair estimates…get your own. Don’t rely on his rent numbers…check them out yourself.
I’m not saying that agents are lying thieves, I’m saying that they are business people first and fiduciaries second.
Oh, the second caveat…don’t sign a standard Buyer’s Agency Agreement that gives him a commission on any property you buy. I think it’s fair that he get paid if you buy any listed property or an unlisted property that he brings to you. On the other hand, if you locate your own prospect and it isn’t multiple listed, he hasn’t done anything to earn a commission.
Ron Guy
NO!!! - Posted by Adam King
Posted by Adam King on April 26, 2002 at 10:08:14:
This is not! A good idea!
This contract means exactly what it says! If you find a home that you want and buy, then the agent is entitled to fees! Plus, an agent should understand right of the bat that you are an investor and you are going to be bringing them work if THEY deserve it! Not the other way around!
I do agree with Mike though, but if you can get out of this contract then why would there be one to begin with?
I have three agents right now and none of them have problem with not being exclusive.
Of course, on the other side of this, if you find a house without your agent (or with), then they could get involved and represent the seller’s best interests. They would do this to get more commission. But if this happens, then you shouldn’t be involved with them anyway and not matter what, someone is going to be against you in the negotiation.
Hope this helped.
Adam
Re: Exclusive contract with Realtor - Posted by JohnBoy
Posted by JohnBoy on April 26, 2002 at 10:00:43:
I wouldn’t sign it!
But if you do want to pursue this then make sure the contract only applies to any property the agent brings to you. Any property you were to find on your own should not involve the agent.