Comments on: Can Real Estate Agents Charge a Retainer? Don’t ask the National Association of Realtors!

By: James Orr

James Orr — Sat, 19 Nov 2011 13:49:37 +0000

You can do retainers in Colorado as well. Section 7.2.3 on the Colorado Real Estate Commission Approved Exclusive Right-To-Buy Listing Contract for working with buyers is for entering the amount for a retainer.

By: Matthew Share

Matthew Share — Mon, 06 Dec 2010 01:16:13 +0000

I enjoyed reading this. I’m a Realtor(r) in the Atlanta, GA area and I was Googling to find out what people’s thoughts are on retainer fees in the industry as I was contemplating modifying the way I conduct my business to include these. The rules will definitely vary from state to state; but I can tell you definitively that in GA and many other states it is definitely 100% legal and, in fact, in GA our standard boiler plate agency agreements have a fill in the blank space for the amount of retainer fee. In practice, very few agents utilize this as of now though I suspect that will be on the rise as more including myself learn how to better survive the current market conditions by working smarter. I have also read that in some states, it is actually law that a retainer fee must be collected. I believe Texas was the example I recall seeing.

By: Ameryst Spivey

Ameryst Spivey — Wed, 01 Sep 2010 21:45:53 +0000

Now that IS outrageous, and they were definitely high rolling the lender because I can bet they only ended up with about 5%. That is the highest I’ve seen a lender pay for a short sale…and even to get that # the Realtor had to get them pretty close to payoff.

By: Ameryst Spivey

Ameryst Spivey — Wed, 01 Sep 2010 21:41:42 +0000

It’s absolutely legal! As a matter of fact, there is a spot for it on the Buyers Representation Agreement used by Realtors. After getting burned by “flaky” buyers, I also have began to charge an upfront retainer. It’s less than $495, but I absolutely charge one….but I also have my closing attorneys credit it to the buyers on the HUD at closing (by taking it out of my at closing commission). If the buyer’s flake out and walk away from a deal, they lose $350 (which is most people’s motivation to do what they are required to do). It’s that simple. This is my JOB, not volunteer work. If you are a serious buyer and plan on actually complying with lenders’ request in order to achieve your dream of home ownership, you don’t have a problem. It’s pretty common here where I live…there are REO agents that charge upwards of $600 retainers. Ironically they have the highest gross closings. You attract the type of clients you market to…It’s really that simple.

By: SELLER

SELLER — Mon, 09 Aug 2010 17:30:04 +0000

I recently hired a realtor to short sale my house. I am used to them charging a commission for this service, but not a commission AND front retainer fees to short sale my house along with an additional $944 at closing. This realtor was requesting 10% from my lender although she said the lenders usually don’t pay the realtors that much. I was able to negotiate my $4,300 out-of-pocket retainer fee to $1,200 and the realtor will request the $944 closing cost from my lender. I couldn’t find anything that said it was illegal. It was just odd since I was only $4,800 in arrears in payments; if I had the funds, I’d have paid my lender to prevent the short sale in the first place.

By: Christine Logan

Christine Logan — Sat, 17 Apr 2010 11:31:26 +0000

Hi,
Here in MD, some agents have been charging a retainer for years and others are beginning to include it in their services. I don’t think it’s illegal but it will let you know who is serious about purchasing or renting. I charge a retainer for rentals of ($100), but it includes their credit report fee. In MD the buyer isn’t responsible for paying the commission to the agent, the seller is. So in my opinion the buyer really shouldn’t have much to argue because $500 is worth having a good Realtor to help you through the transaction.

By: Marcam

Marcam — Thu, 27 Sep 2007 22:02:06 +0000

I might not ask my brother for one! Then again, I tend to shy away from working with family. I do agree with Dennis, it is not in voilation of the Code of Ethics. It is just business deal between a broker and the client.

By: Craig

Craig — Thu, 02 Aug 2007 20:25:23 +0000

I clearly see the benefit of charging a retainer. If I was a real estate agent I would upfront.

By: Dennis London

Dennis London — Sun, 08 Apr 2007 11:55:07 +0000

A retainer is an advance fee for services. Many types of professional service providors (fee for service) collect part or all of their fees in advance.

The guidelines for NAR would be the Code of Ethics.

“You don’t ask – you don’t get!” – a quote from my grandmother….

It is neither illegal, nor a violation of the Code of Ethics for a real estate professional to ask for and receive an advance payment. The issue is “in exchange for what”. There must be a relationship established and an agreement regarding the “fee for service”.

AND of coure the realtor can only be paid from his/her broker – so payment must be to the broker.

So – agents out there – do you have the stones to ask for and are you you a strong enough salesperson – to ask for and receive an advance?

By: Joshua Dorkin

Joshua Dorkin — Mon, 02 Apr 2007 04:11:36 +0000

I can certainly see the benefit of charging a retainer, but even if I were able to (back when I was an agent), there is no chance I would have asked for one. Personally, I think it is obnoxious. Buyers/sellers are already handing away so much money to a full service agent. Charging a retainer on top of that (or even having to come up with more cash upfront) to satisfy a realtor’s fears about getting paid is just too much in my book.

If you don’t want to deal with flaky buyers become a seller’s agent.

By: TPercival

TPercival — Sun, 01 Apr 2007 12:39:34 +0000

I recently was at a seminar that focused on Realtors in my area. The speaker gave some ideas for seller and buyer’s agents to help them stand out from the competition.

One thing he stated, was that the buyer’s agent should charge an upfront fee. He felt that it helps eliminate the buyer from having many realtors working for them at the same time, and only 1 of them possibly being paid. If the buyer’s agent found a house to purchase, then this fee would later come out of their final commission.

The ideas was split among the Realtors at this seminar, some felt they could never ask for it or get it, others said they already do get it and don’t have too many people saying no to them.

I don’t know if it’s right or wrong, but wanted to add some input.

By: Maureen Francis

Maureen Francis — Sun, 01 Apr 2007 06:11:23 +0000

Everything in real estate is negotiable and we have a bazillion business models to prove that. When I first heard of an agent here in Michigan who was using a retainer I thought it was absurd. Now I think it is brilliant.