How do I get around the realtor on first L/O deal? - Posted by Matt H

Posted by SteveG_Pa on October 14, 2003 at 14:41:27:

Dont forget to get a list of people the agent showed the house too. You dont want to find a buyer, if thats what your doing, then find out the agent showed them the house already.

How do I get around the realtor on first L/O deal? - Posted by Matt H

Posted by Matt H on October 14, 2003 at 09:44:06:

Hey guys,

I have a house that will L/O, no problem. Seller’s very motivated because of mortgage payments. I will have it under contract tomorrow evening.

Here’s the rub, it is listed 'til February with Coldwell Banker and from what the homeowners tell me nothing is being done. Surprise, surprise. How do I get around this? Thanks alot.

Matt Hegedus

Re: How do I get around the realtor - Posted by Andy Light (MI)

Posted by Andy Light (MI) on October 15, 2003 at 02:32:12:

In the realtors contract I can gurantee that there is a clause in it saying something like this: If a buyer comes to you the seller agrees during the time of this listing to refer them to the realtor.

If you purchase this home LO (and why u would do it LO is beyond me also…i always would do Sub 2 but thats me) the broker of the company could come after the homeowners for their commission.

People think that realtors don’t do a lot. I know differently. I used to be one. Realtors spend a lot of out of pocket expenses that you might not even think of. Personally its not a good job to make money. (the reason i left) I would either have the people cancel their listing (which is pretty easy) or you can do the respectable thing and pay the realtor. I am not saying pay them the whole commission but I would approach the broker or realtor and tell them that the homeowner is interested in leasing the home to you and that you would be willing to pay them for their marketing expenses. Say somewhere around $500. How would you like it if you had a commission job and thats how you fed your kids and you spend your money putting ads in the paper, or even if they didn’t do that the realtor has quite a few hours involved and not get anythign back.

I would personally take the high road and give the realtor something. It will make you and your company look better in the long run.

Andy

Who Found Who?.. - Posted by Greg in Dallas

Posted by Greg in Dallas on October 14, 2003 at 12:37:43:

…is the question that begs to be answered.

If the seller found you then it would be up to the seller & his/her own best interest to cancel the listing agreement so they can pursue other options with you.

If you found them as a result of the listing then, rightfully so, you owe the agent some form of compensation for making you aware of the property through whatever form of advertising you found it through (albeit MLS, Newspaper Ad, or Signs). Keep in mind that if you’re doing a L/P then the compensation to the realtor is negotiable.

This business is about being fair.

If the seller found you strictly as a result of your advertising then you need to let the seller know that you’re NOT in a position to pay a commission and if they want you to buy/lease their house then they need to get the listing agreement cancelled or you won’t be able to do anything until it expires, etc. If the realtor asks why they want to cancel they might tell the realtor that they’re going to try to sell it on their own or just rent the house out, because they can’t afford to make payments & wait for a retail buyer right now. Make sure they get a signed release and cancellation of the listing from the realtor or broker.

Good Investing!
Greg

I disagree - Posted by Eric - GA

Posted by Eric - GA on October 14, 2003 at 11:32:39:

I think you’re under no obligation to pay the realtor’s commission, after all, you’re not the one that has an agreement with the realtor to pay. It’s up to the seller if they want to pay the commission.

As another option, have the seller call and discontinue their listing effective immediately. At the same time, send a certified letter dicontiuing the listing.

Eric - GA

Re: first L/O deal? - Posted by Brent_IL

Posted by Brent_IL on October 14, 2003 at 10:59:16:

If you get it under contract tomorrow, he has to pay. It’s not only bad form, but it’s bad for business to screw the real estate agent. What you can do is to make your offer subject to acceptance of a modified payment plan for the commission due. Then work on the modified plan.

Will the agent accept a commission that is paid over a period of time, say 24 equal payments? How about a secured note earning 10% a year interest and payable at 1% of the initial commission a month?

The agent has four months left on the listing agreement, so your job is to convince the agent and his or her broker that if they haven?t sold it in 60 days, money paid piecemeal is better than an expired listing.

If this is your first L/O, take the time to assemble the numbers and documents that will show them that your plan is viable. You don?t want to ask them for concessions by saying, ?I?m going to rent this place to someone yet unknown, who?s willing to pay above market rental rates so I can get rich.?

Re: How do I get around the realtor… - Posted by Randy (SD)

Posted by Randy (SD) on October 14, 2003 at 09:50:14:

You don’t…Pay the realtor’s commission.

The sad fact of this situation is it does not matter if the Realtor is marketing the property or responsible for the resulting sale or even the type of sale-L/O, cash or Land Contract. The Realtor is entitled to their commission.

I found them, but… - Posted by Matt H

Posted by Matt H on October 14, 2003 at 12:46:03:

Greg,

I cold-called on their “house for rent” ad in the paper. They were trying to rent it out on their own (it was the homeowner’s ad) while the realtor did nothing but list the place.

If things will work out and they accept my offer, I will then talk about cancelling the listing with their realtor.

Good advice all, I’ll keep you guys posted after tomorrow.

Matt Hegedus

Re: I disagree - Posted by Brent_IL

Posted by Brent_IL on October 14, 2003 at 16:51:44:

The law in your state may allow this, but most listing contracts are not unilaterally cancelable, certified letter notwithstanding.

exclusive agency contract? - Posted by gerald(tx)

Posted by gerald(tx) on October 14, 2003 at 16:35:54:

If the owner is advertising on his own, he could have an “exclusive agency” contract rather than an “exclusive”. Exclusive agency gives the owner the right to sell on his own without paying a commission.

Check it out.

Also, remember the seller can usually cancel the contract with few problems. The agent will provide the seller with a list of protected clients. Since your name won’t be on the list, he’s safe.