Working with Realtors on Payouts

6 Replies

Hello BP,

So I've been researching this topic on working with realtors on wholesale deals. If your the wholesaler, and a realtor (investor friendly) finds you a buyer, what do you pay them? Is it a flat fee commission, or commission based on the sales price?

I recently thought splitting the spread in half, but what do other investors/wholesalers do?

Thanks

In many states a licensed real estate broker cannot receive compensation without an explicit listing agreement. I've not been there, but I would imaging you'd need to 'list' your property with the broker prior to getting an offer...

I would be interested in this answer too. I live in and area that has few private/ independent cash buyers, and I'm new so I haven't really developed a relationship with any. If I find a deal in the $100k's I'd like to be able to wholesale it to a buyer with the cash needed. It's seems that realtors may be the best bet, but how do you turn the deal over quickly <30days if you have to list it?

I also wondered the same thing about brokerage firms.

You can have a commission agreement with an agent, without "listing" it, just like with FSBO's, an agent can get a commission for simply bringing you a buyer. You can market it "brokers protected".

Originally posted by @Wayne Brooks :
You can have a commission agreement with an agent, without "listing" it, just like with FSBO's, an agent can get a commission for simply bringing you a buyer. You can market it "brokers protected".

Indeed. I might have to take back my prior comment! I think this is probably accepted just about everywhere as an implicit agreement to compensate a licensed broker. I think that's the best answer for the question at hand.

In most states an agent cannot accept a commission directly from a seller it must go through his or her broker.  An agent accepting a commission is subject to loss of license in most any state.  Keep in mind that there is a distinct difference between a broker and an agent and it is a different license with different rules and responsibilities. It is more than just who owns the company.

Any commissions earned belong to the employing broker and not the agent. It is the broker's butt on the line more than the agents. The agent and his broker split the commission based upon their contractural agreement.  Now the agent may have an agreement to keep 100% of their own purchases but that is subject to the agreement between broke and agent.

Most agents here in Dallas will accept a gift outside of escrow for services render. Most agents don't know how to structure a deal where it is a win-win for everyone.


My experience,


Joe Gore

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