BiggerPockets

The agent will have you sign a double agency form indicating that you are aware that he is representing both buyer and seller.

I would buy a property that my own agent had listed. But if I am looking at a listing from a strange agent, I would have my own representation. You aren't going to pay any more in commission.

The exceptionj would be if you really really know what you are doing and can talk the agent into cutting his commission because he is getting paid from both sides.

My agent, their agent, the Three Musketeers..... I never ever give any agent any information that would harm me if the sellers heard it.

P NW, I didn't know I would pay any commission at all. Like residential, I thought the seller pays the commission.

Thanks for your response.

Good advice from Matt. The law provides many protections to residential buyers, understanding most are unskilled and unknowledgeable about the home buying process. There are no such protections when you buy commercial properties, which are considered business transactions. Business owners are able to negotiate any deal they want with less legal interference or protection.

You can get your lunch eaten by a savvy property owner and his/her agent if you don't know what you're doing. True, the agent is supposed to represent your interests as well, but for the same money (none to you in most deals) you should get someone who represents you 100%.

In fact, all agents represent themselves 100%, but you ought to tilt the table as far as you can in your favor.

Jeff

[[[[......I didn't know I would pay any commission at all. Like residential, I thought the seller pays the commission....]]]]

The commission comes out of what the seller receives, but who is providing that money? It's the buyer. If you can get the agent to lower his commission, it lowers the price.

Here's how it works: Suppose the commission is $60,000. 25% to the seller's agent ($15,000); 25% to the seller's broker ($15,000); 25% to the buyer's agent ($15,000); 25% to the buyer's broker ($15,000)

Now: if the agent has duel agency, he gets both the buyer's agent and seller's agent % of the commission. So the agent is getting $30,000 for making the sale, and his broker gets $30,000.

The buyer negotiates the best deal that he can,(the seller won't go down any more) and then he says to the agent "Gee, I don't know. It's still $10,000 more than I want to spend. Get it down another $10,000 and I will buy.

If the agent drops his commission by $10,000, the buyer saves $10,000 off the price. The agent might figure $20,000 in his pocket beats holding out for $30,000 and not making the sale.

A few agents might drop their commission automatically, but to their own client's advantage-- ie: they charge less commission to the seller. Most agents, you have to ask.

I've never heard of any agent who automatically drops his commission to the benefit of the buyer.

The sellers agent is responsible for the commission and often will state what they are willing to offer as a split if you have your own agent. If you contact them before acquiring an agent and later return, many will not honor your agents commission. In commercial deals they ask you to sign a confidentiality agreement and to disclose if you are represented by a broker prior to forwarding you rent rolls, operating expenses, etc. Also, this is not said but if you have an agent, this usually decreases the ability to lower the price if you plan to make an offer quite lower than the asking price. the broker will advise their client to wait for a higher offer and will not negotiate a lower commission. If you are a good negotiator you can go it alone, if not, I suggest getting represenation before approaching a deal.

Sheila

Also...when choosing a Broker try to find one that has a Certified Commercial Investment Member (CCIM) . They have went through additional eduction and generally a little more savvy.

-Ken

Originally posted by Sheila Brown

Should I allow a broker to exclusively represent me?

No way. Exclusive representation enables a broker to market his properties to anyone he wants including you, but ties you into buying only from him. If you find a deal on your own, or from another broker, you still owe your "exclusive" broker a commission whether he lifts a finger in your deal or not.

Some will claim they will give you the better deals first. This is baloney, and nothing prevents them from making this claim to everyone.

I make it clear to all brokers:

1) If they find a deal for me, then they get to represent me.
2) If someone else find a deal for me, then that person can represent me.
3) If I find a deal on my own, then I'll choose who represents me.

I generally have no problem signing a non-compete non-disclosure agreement for a specific property after they present the deal to me.

Jeff

Originally posted by Sheila Brown

I guess I sounded too eager, or maybe too desperate. :-)

Most investors know that it's best to find motivated sellers. The corollary is also true however; never be a motivated buyer.

You are in the strongest negotiating position when you can walk away from the table with impunity.

Jeff

And I know that as well. Even though my main source for SFR was the MLS, I still knew a motivated seller was the key. My only source for commercial is Loopnet since I don't have a broker working with me. So I never speak with the seller because of the seller's broker.

I really hate to sound naive. I have found another property that I am interested in and have the financials on the property. I'm looking for a CCIM broker to represent me. I found out that the seller, with 20% - 25% down, "might" wrap the balance for a qualified buyer. So, here I go again...