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Agent-as-buyer Commission |
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We are in the process of selling our home. The commission base for our agent is 2% if she brings in the buyer and 4% if it is brought from another broker. After much negotiations on the sale price, which we lowered be over 50K fromt the asking price, we find out that the buyer is an broker. when we find this out we ask our agent about the commission. Since a broker is buying our home, and we negotiated a price, we didn't feel that she should then get a commission off the sale of our home, so we asked our agent how much commission will we be paying. She said that she will be getting the 2%. No mention of the Buyer (who is a broker) getting any. Our closing is set for May 1, and the closing attorney sends us the HUD settlement statement for our review. We see that the commission is 2% to our agent. However on line 501 of the HUD form, under excess deposit an amount is listed. So we call the attorney's office back and question this amount. We are told that this is the buyer's (broker's) portion of the commission of our home. We were quite upset by this and immediately called our agent, and got absolutely nowhere with her. Is this practice legal or ethical. If it isn't how do we proceed to get this resolved. |
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It's not clear to me whether or not you'll be paying that buyer a commission, or whether perhaps the line on the HUD statement represents some juggling with down payment information. The agent who is buying property is expected to reveal the fact that he or she is a licensee in writing, in the purchase offer. As for receiving part of the commission -- it can be unethical or even a violation of the law of agency, depending on the circumstances. I'm afraid I can't tell you much about this one. Sorry I can't be of help. Good luck to you. Cordially, Edith
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Edith
Originally published on April 28, 2007 |
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