Full commission just for writing an offer?

By
Real Estate Agent with Alain Pinel Realtors

I'm flummoxed.  Perhaps I naively hold the belief that a receiving a commission inherently implies that that the job for which you are paid is actually conducted.  Call me crazy.

I received several phone calls on my listings this week that caught me by suprise.  I will share the two common themes of those conversations.

#1:  "I would like you to arrange a time for you to meet me and my buyers at your listing."  When I respond "The home is vacant and has a lock box so you can arrange to visit the property any time that works for your schedules." I am told "I only about sell one house a year as a favor to my friends and family so I don't have a lock-box key."

In the big scheme of things, scheduling an hour to have my listing viewed isn't a problem since I was hired to get the home sold.  But think of the big picture.  I think it is safe to assume that this Agent has a full-time job outside of selling real estate.  What if, best case, the potential buyers LOVE the home?  Will he then expect me to be "on call" for the buyer's home, pest, chimney and/or roof inspector? 

#2 from Realtors who work anywhere from 80 - 400 miles away:  "My clients want to write an offer on your listing at [address] but I'm not a member of your Multiple Service.  Could you please send me a copy of the MLS printout, the comparables you used to price the house and your Agent Visual Inspection Disclosure so I can review the conditon of the home?"

Is this Realtor providing top notch (or even average) service to his buyers?  What if was bad at my job and provided old comparables substantiating a higher-than-current market price?  What if I did a poor job completing my Visual Inspection? This out-of-area Realtor has no idea about my professional standard of conduct! 

The question again arises as to who will meet with the buyer's home, pest, chinmey, roof, sewer inspector? Since I make it a business practice to avoid double-ending my listings, I sure the heck DON'T want to create ostensible agency by attending them in lieu of their out-of-area Realtor.  In short, it appears this Realtor anticipates receiving a full commission just for writing an offer.

Wouldn't these buyers be better served by a referral to a local, full-time, professional Realtor who knows the area, can research the price, can personally view the home and can schedule and be present at all of the buyer's desired inspections? 

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Realtors®
Tags:
buying a home
buyers agent
selling a home
contra costa real estate
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Show All Comments
Rainmaker
401,965
Claudette Millette
The Buyers' Counsel - Ashland, MA
Buyer, Broker - Metrowest Mass

Wendy: 

The situation you are referring to sometimes makes brokers in my area so angry that they will offer a low commission in the MLS to the Buyer Broker, but, when I call to inquire about it, they ask if I am planning to do everything for my client, including attendance at the home inspection. They then reveal that they are perfectly willing to fully compensate -- They just wanted to know the answer since they had a previous bad experience.  Perhaps the part-time brokers will be disappearing with the tough, competitive market that we are currently experiencing.

 

March 03, 2009 06:44 PM #2
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Gary:  Exactly!  If you don't have the time, the tools or the local expertise, refer the buyer to someone who does!  You can legitimately get paid a referral fee for doing nothing, but to expect a full commission - that's just wrong.

March 03, 2009 06:44 PM #3
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Claudette:  Now THAT's interesting!  We (in California) are required to disclose the selling agent's compensation as part of our Listing Agreement AND MLS disclosure.  I'm not certain we have the right to adjust it based on our personal interpretation of what constitutes full buyer representation.  I will definitely check in to it though!

March 03, 2009 06:48 PM #4
Rainer
30,772
Doug Aaserude
Inactive until May. 2009 - Beaverton, OR
Broker

I have been in many situations where I have had to pick up the ball and run with it. I don't get all mad, and bad talk the agent. I may try to help them understand their job better, but in the end, they have a BUYER for YOUR LISTING. GIT R SOLD!!!!!!!

March 03, 2009 06:53 PM #5
Rainer
25,445
Sandy Gleason
North Pointe Realty - Buhl, ID
Realtor for Southern Idaho-Magic Valley

I just finished a deal that the agent (local) did not do much. I kept the deal together but only

because I was working for my seller. It is sad to think what would happen if two lazy Realtors did

a deal.

March 03, 2009 07:00 PM #6
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Hi Doug:  Thanks for popping by.  I don't get mad - it serves no purpose.  And, yes, they have a buyer for my listing and I appreciate it.  However, I don't believe the mere act of providing a buyer without completing the remainder of the job on the buyer's behalf deserves full compensation.  If that is all the selling agent plans to provide, I would prefer that my seller save some of the commission which was offered assuming a full-service Realtor.

March 03, 2009 07:03 PM #7
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Sandy:  I think it is safe to assume that two lazy Realtors in the current market will result in a sale-fail.

March 03, 2009 07:04 PM #8
Rainer
8,388
Jamie Boney
Mungo Homes - Columbia, SC

You are very correct, it is frustrating!!  I am a firm believer of Carson Daly's karma concept!

March 03, 2009 07:06 PM #9
Ambassador
897,107
Andrea Swiedler
Berkshire Hathaway HomeServices New England Properties - New Milford, CT
Realtor, Southern Litchfield County CT

We have more than one MLS in CT, and many times get wacky calls from agents who can only see what is on realtor.com or some advertising website. They may not have an electronic keypad. And, if they don't get something in writing from my broker that says she will agree to pay them a commission, they aren't entitled as they are not members of this MLS. I think because what we are going thru in CT is very very political, we are a bit more understanding, although none the less aggravated at the situation. But, I sure make them show up and work for their money!!!

March 03, 2009 07:15 PM #10
Rainer
264,951
South Austin Real Estate Blog
Sky Realty South Austin - Austin, TX

In our board we have the right in the Listing Agreement to state what percent the out of our MLS selling agent can get.  Like... in our mls.. 3%  ... OUTSIDE  can be from 0% to 1.5% or the full 3%.  It is part of the MLS print out and available to all agents to see.

March 03, 2009 07:18 PM #11
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Hi Andrea and Gail (I am answering you together because it dovetails):  We also have hundreds of different MLS systems in CA.  The commission posted in the MLS is, in fact, specifically for members of OUR MLS.  Out of area agents are required to submit a CBC form with their commission request in advance of presenting an offer (it is not to be part of the negotiation).  I have never changed the commission agreement for out-of-area Realtors but I will definitely consider Gail's idea for those situations.  Still stuck on the non-performing Realtors within our MLS.

March 03, 2009 07:22 PM #12
Ambassador
1,329,062
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Selling Daytona paradise for heavenly good prices

There are 0any scenarios and different situations. In our small county there are 3 different MLS, and though they all use Supra, you would not get in if it is not your area. Now agents are often list everywhere, and it is really a problem.

The best solution is not to use supra and use a combo lock, and we now think of switching to combo locks 100%, as we also get people comong from Palm Coast.

So, we do not make a big deal. I will gladly arrange showing , opening to inspectors, all for the Buyer.

March 03, 2009 07:32 PM #13
Rainmaker
120,327
Mike West
Heritage Oak Properties - El Dorado Hills, CA
El Dorado Hills, CA CDPE, CNE, Licensed Loan Origi

Hi Wendy,

 

Unfortunately, there are still far too many agents out there who are willing to take advantage of someone who takes their responsibilities seriously.  You still have to look out for your client's best interest and they take full advantage of that.  Wish I had an answer.

March 03, 2009 07:45 PM #14
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Jon:  Funny that you should mention combo-locks.  I used a combo-lock on one listing with frightening results.  Another out-of-area agent gave the combination TO HIS CLIENT and sent the client to view the home WITHOUT HIM. I kid you not!  The seller on that particular listing was a single woman.  Do you see the potentially serious personal safety issues for my seller?  As far as I know, no one runs a background check on their clients.  I will never again use a combo lock.

March 03, 2009 07:49 PM #15
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Mike:  So true and I do unless it puts me in the position of ostensible agency.  If I let that happen, I have then compromised my client's best interests.

March 03, 2009 07:53 PM #16
Ambassador
287,596
Tim and Pam Cash
Crye-Leike (Sango) - Clarksville, TN
Real Estate Professionals - Clarksville TN

Wendy, it seems as if it would be more appropriate to offer a referral to you or another agent in the area who is dedicated to taking care of the buyer's needs.  You should not be in the position to do the work for the buyer's agent.  That said, i can see your dilema in that you want to take care of your clients and ensure that every opportunity to market their home is explored.

March 03, 2009 08:03 PM #17
Ambassador
1,862,121
Judi K Barrett
Judi Barrett~Integrity Real Estate Services~Idabel, Oklahoma - Idabel, OK
Broker/Owner, Integrity Real Estate Services -IDAB

Wendy, I accept referrals from "out of the area" agents, not co- brokering.  I have had too many offers from agents who only want a paycheck and do not do their client justice.  I end up working both sides of the transaction for half the commission.  Been there, done that.  Don't do it anymore. 

March 03, 2009 08:17 PM #18
Rainer
8,792
JJ Leininger
Makai Properties LLC - Lihue, HI

I had a buyer call me on my listing asking to see it. When I asked if they were working with someone, then they told me that their agent is on Oahu.  I went ahead and showed them the house. They decide to buy it. Yea! I was happy to make the sale in this slower market.  Their realtor was not keeping up with the escrow, so when I reminded her that the buyer's additional deposit was due at the end of the inspection period, she asked to schedule the inspection and extend the inspection period. My seller agreed.

Well, lucky me! The buyer was doing their own inspection and I got to meet them at the house, again without their agent. Oops, he forgot his ladder and he wanted to go back the next day again. Well, I went ahead and met him at the house the next day. How stupid do I sound here? (I did learn from this and he didn't fall off his ladder) Long story short, a few days later, on the last day of their extended inspection period at 6:00 PM, the other agent faxes me the cancellation notice. No one is at my office, so I find out the next morning.  She did not even give me a personal phone call.

I talked this over with a 30 year agent, and he told me how he handles off island realtors with buyers.  They can refer them to him and he will take just 1% commission on the buyer's side, and give the other 2% goes to the off island realtor, or they can refer to another local realtor, or they can be at the showing. He tells them straight up that he will not show his listings to a buyer with a realtor unless their realtor is present. This sounds good, but how would a seller feel about this? Would they think I am turning away potential buyers if I refuse showings?

March 03, 2009 08:52 PM #19
Rainmaker
126,712
Wendy Cutrufelli
Alain Pinel Realtors - Walnut Creek, CA
Contra Costa Realtor

Tim and Pam:  Exactly!

Judi:  Referral, not co-brokering, Amen Sista!

JJ:  I, too, receive phone calls from buyers who want to view my listing either before a contract is written or when in contract, but their agent is not available.  Are you kidding me?  All I can say is "garbage in, garbage out".  A "garbage in" transaction just seems to tie up the property and end unsuccessfully.  It's not even worth taking the house off the market.  There are too many GOOD Realtors out there!

March 03, 2009 09:12 PM #20
Rainmaker
84,095
Terri Adams-Scott
J. Rockcliff, REALTORS - Walnut Creek, CA
Realtor, Walnut Creek CA Real Estate

Good post and interesting comments.  Personally, I'm a believer in referrals.  I realize we're licensed in the state of California, but I don't believe we should represent clients within the whole state!  I think it's the lack of educating the consumer in the importance of choosing a Realtor...and understanding what all it is we do...and the benefit to them in selecting a local agent for the area they want to buy/sell in.   I would love to see some of my NAR/CAR dues go to educating the consumer on our profession...other than a generic 'call your Realtor' commercial.

March 10, 2009 04:31 PM #21
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Rainmaker
126,712

Wendy Cutrufelli

Contra Costa Realtor
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