Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
So I sell properties from time to time with owner finance. Whereas I typically never get over 10% down and sometimes less what would be considered a fair fee to an agent that brings me a buyer that needs owner finance? I realize the standard for most buyers agents on a transaction is 3%. However a lot of their buyers do not get approved for a loan and a deal falls through on many occasions through a traditional sale. With these owner finance transactions it is pretty much a guaranteed closing. Has anyone else used agents for this sort of thing? I typically find my own buyers, however I’d like to spend more time on my other parts of the business instead of focusing on selling and meeting buyers. Any insight?
I have done a couple of these. Basically, I gave them their 6 % commission, However, I pay half at closing, 1/4 at 6 months and the final quarter at 1 year. This helps the realtor, I do not have to pay out small monthly checks and the realtor gets a better check each payout. Note: This has only worked when the agent was the broker/owner. It can be done, but they need to know up front how things will be paid. Then Make sure you pay as agreed, the out is if the buyer defaults, the realtor does not get paid. The buyer has to be current at each pay point.
I have done a couple of these. Basically, I gave them their 6 % commission, However, I pay half at closing, 1/4 at 6 months and the final quarter at 1 year. This helps the realtor, I do not have to pay out small monthly checks and the realtor gets a better check each payout. Note: This has only worked when the agent was the broker/owner. It can be done, but they need to know up front how things will be paid. Then Make sure you pay as agreed, the out is if the buyer defaults, the realtor does not get paid. The buyer has to be current at each pay point.
It appears what you’re saying is that the realtor does not get paid until your buyer refinance. That almost sounds like a lease option however you’re in Texas. What I’m describing is we transfer title at closing to the new buyer. The realtor gets paid then. In a setting like that 6% is not reasonable for owner financing in my book.
No, it is not a lease purchase. I transfer upon the sale, with a General Warranty Deed with Vendor's Lien and Deed of Trust filed. The commission with the realtor is half of his commission on the front end and then pay the remainder of the commission in two payments, one at 6 months and one at a year. I put it in writing once and the subsequent deals were verbal agreements between realtor and myself.