Not paying a realtor?

Developer · Andover, MA · Member since 2008 · 1k+ posts · 489 votes

I got a call yesterday from a homeowner who wants to sell their home. He owns the property free and clear and is willing to sell it to me for $60k. Unfortunately, the property is currently listed with a RE agent (listed for $150k) and the contract doesn't expire until the end of March. Since the homeowner would prefer not to pay the commission because he actually found me, not the realtor, what are my options? I would think I have 2:
1) Wait until the contract expires, or
2) Increase the purchase price by the RE agent commission.

Do I have any other options that are both ethical/legal to get around either or us paying the commission?

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Jim S

Real Estate Investor · Virginia, DC &, MD · Member since 2008 · 261 posts · 71 votes

14y

I would be more concerned by the list price of $150,000 but the homeowner is willing to sell it for $60,000. That is very unlike homeowners to take that serious of a price reduction. Makes me wonder if there is something seriously wrong.

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Chris ClothierBusiness Member
Rental Property Investor · memphis, TN · Member since 2009 · 2k+ posts · 3k+ votes
14y
Justin -

Plenty of other people have already addressed the "unique" deal you have where a seller is willing to discount $110k to you. That sounds odd enough, but has already been covered.

My thought on this is that there is no reason not to pay a realtor who is under contract at the time you were introduced to the deal. Regardless of what they have earned or what they are owed, it is under contract with a listing agent and they are entitled to be paid - IMO.

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Steve T.
Real Estate Investor · Colorado Springs, CO · Member since 2009 · 25 posts · 4 votes
14y
Bottom line - the REALTOR has a fiduciary to their client... this has NOTHING to do with them receiving a commission. An ethical REALTOR will not push their client to close a deal just so they can get paid.

As far as procuring cause and an active "Exclusive Right to Sell" contract (which is most common) ... the agent should get paid during the contract period (and holdover, as negotiated). However, IMO, if the property owner found the buyer himself, NOT another agent, then there should be some room to negotiate the commission on one side of the sale. Most agents will expect to double-end it, which is still not unreasonable if you expect them to work both seller and buyer sides of closing the transaction (as transaction broker, or dual-agent depending on your state).
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