Forgoing "extra" commission to make the sale

9 years ago

Silly question, apparently: Found a house I want to buy, I know the sellers, and I know what they want to walk away with, and I know the commission in the listing agreement, it's 6%. As a buyer, I feel like if I represent myself I should be able to shave 3% off that commission for a net 3% to the listing agency, but the agent won't agree to it, even though it would make the sale happen. Is there a different way to approach it?

Example (Rounded for ease of use):

Seller wants to net $200,000 after commission

Listing agreement states 6% ($12,000)

I want to offer $212,000 with $6,000 in concessions, the listing agency gets $6,000 and the sellers get $200,000

I can certainly go get an agent just to not let the listing agency get the full 6% if they're unwilling to negotiate, but then my offer becomes $218,000 ($6,000 for concessions and $12,000 in commission), but that seems silly. How can I appeal to the listing agency so my price is $212,000? Don't tell me to get a buyer's agent, either.

Featured Answer

Denita

9 years ago

last modified: 9 years ago

Buyer's credit = seller concession.

There are only two parties to the P&S contract: the buyer(s) and the seller(s). That's why everyone is encouraging you to just make your offer. Anything that is done between the Seller and the listing agent has already been negotiated and if the seller wants to open up those negotiations again, it is between them, on a separate contract that has nothing to do with the buyer.

Edit: Occasionally an agent will contribute toward the buyer's closing costs out of their commissions but that is a very rare event IME. It is the seller that contributes out of their proceeds. It has to be in your offer. The way to accomplish that goal is to word the contribution right in the P&S contract. Yes, there is a right way and a 'wrong' way.

Sort by:Oldest

Comments (11)

User
9 years ago
Don't worry about the seller. Just make your offer.
bry911
9 years ago
last modified: 9 years ago
Some flat fee listing services will provide minumum services for a buyer and rebate you back the difference.

There is a company here that charges buyers $1,000 and will help with offers and counter-offers but will not show the property. At closing they hand you a check for the difference.
Related Professionals
Port Saint Lucie General Contractors · York General Contractors · Wichita Falls General Contractors · Petersburg General Contractors · Waterbury General Contractors · Binghamton General Contractors · Lewiston General Contractors · Pullman General Contractors · Sugar Land Architects & Building Designers · Chillicothe Architects & Building Designers · Webster Architects & Building Designers · Stockton Architects & Building Designers · Cowansville Architects & Building Designers · Cookeville Kitchen Remodelers · Champaign Kitchen Remodelers
sushipup1
9 years ago
Write your offer. Include "3% to listing agent". Buyers can take it or counter the offer. The agent gets what the seller agrees to.
Denita
9 years ago
last modified: 9 years ago
First of all the buyer can't dictate the commission to the listing agent. There is a listing agreement in place between the listing brokerage and the seller. That contract was signed before the listing was placed in the MLS.

jn3344 has the answer to the OP. Just make your offer. Let the seller decide what s/he will do. If the OP doesn't want to use an agent, s/he is under no obligation to use one. The Purchase and Sale agreement is completely separate from the listing contract. Any modification of the commission belongs between the seller and the listing brokerage. Nowhere is the commission stated in the P&S contract.
ncrealestateguy
9 years ago
The Listing Agreement is a contract between the agent and the seller. The buyer has no options to write anything in the offer that pertains to the agreement that the seller and the agent have already agreed to.
ncrealestateguy
9 years ago
Listing agreements also contain a place to list any exceptions in regards to buyers that the seller may already be in communication with prior to signing the listing agreement. Apparently, he did not list you as an exception to the commission arrangement.

Also, if your RE market is like a lot of other areas, it is a sellers market, which gives the agent good reason not to budge on her commission.
Bob C
Original Author
9 years ago
Is a buyer's credit (which comes from the agency commissions) something that could be put into a P&S agreement, or is that still something that is between seller & listing agency?
User
9 years ago
Agree you are making this more complicated than it should be. Forget about what the seller is willing to accept and what the commissions are. Make your offer based on market comparables and then let the seller make a counteroffer if they don't accept your offer. In your example I'd offer $206,000 unless there are added details like closing costs. Deals seldom fail to consummate over a few thousand dollars.
ncrealestateguy
9 years ago
Bob, a buyer's credit comes from the seller, not the agent's commission, unless he/she works for one of the few agencies that do that sort of rebate.
Bob C
Original Author
9 years ago
I thought a buyer's credit was something that came out of the commission, or is a buyer's credit the same thing as a seller concession?