The Tug of War Over The Buyer’s Agent Commission
March 12th, 2008 Categories: Buying
Unrepresented Buyer Wants Half The The Commission
I came across two different buyers recently and I asked if they were working with an agent. Both said they would represent themselves and they would negotiate the buyer’s agent commission.
For the sake of this discussion the seller and the listing broker negotiate a contract and the seller is to pay the listing broker a commission. The listing broker is offering a Buyer’s Agent Commission (BAC)
A Buyer comes along and says I don’t have an agent they want the commission.
One buyer asked, “I assume there are two commissions.”
There is actually only one commission paid by the seller. The listing broker can offer compensation to a broker for any amount they see fit. They can offer no compensation and expect the buyer’s agent to collect a commission from the buyer.
So if there is no agent representing the buyer, what should happen to the commission?
Should the unrepresented buyer be entitled to the commission?
What about the seller? After all they are the one paying the commission, shouldn’t they be entitled to it?
What about the listing agent shouldn’t they be entitled to it?
Leave a Reply
Copyright © 2007 3 Pounds of Real Estate Agent Login Design by Real Estate Tomato Powered by Tomato Blogs
I have been trying to find an answer for this for a long time and have found several links to the topic saying that you CAN represent yourself as a buyer and you SHOULD be entitled to the buyers part of the commission! When searching on it though, 99% of the hits is from Real Estate Agents(Big surprise) that tries to explain why a real estate transaction takes a buyers agent(Not so big a surprise!!). It all is a big scam – No buyers agent is really needed! The agents in an area are all “related” and work out of the same perspective: To make money! Not to sell houses or help neither buyers nor sellers… To make money and make as much of it as possible! So there is a huge conflict of interest by introducing the concept of a buyers agent that is only interested in the actual transaction taking place for as much as possible where they really should be concerned about making a good, healthy transaction with the buyer for as little as possible! The system is faulty and to some extend fraudulent as per the conflict of interest. If the Real Estate agents were to give up on this matter they would lose a lot of business – up to 50%! You can be represented by a lawyer which might have an easier time claiming the BAC and then pay him by the hour an pocket the BAC yourself. No reason for it to be easier for a lawyer, but if you start dealing with the Sellers agent directly, claiming the BAC, they will deny and make the transaction very hard to succeed, which is illegal as they should be representing the interest of the sellers, which is to make the transaction! Big problem allowing the whole concept of the buyers agent! It should be illegal by law, or other measures should be in place to avoid corrupt agents in the market. Presently there is no regulation for this matter.