Contribution of Assignment Fee Paid to Realtor?

Question

Hey Everyone

Just recently met with an agent, who agreed to send me Philadelphia properties off his MLS. I am thinking of compensating him with a 70-30% of the Assignment Fee. 30% if I find the end buyer. 70% if he finds the end buyer.

Is this too much commission for the agent? Or am I in the ballpark?

Thanks in advance!

Lucas Pfaff · Answer

Seems fair to me. There are no set referral fees, but be that as it may...what I would consider standard referral fees (in Philadelphia) between agents are between 20-30%. Being a non-agent, if you receive a 30% referral fee you are getting a very fair cut (particularly for not having a license and paying the associated fees).

Note: I would be very careful with the language you use when discussing these opportunities with potential buyers. Although I am uncertain of the specific language applicable to this situation, there are certain things that non-licensed sales people are allowed/not allowed to do for licensed agents. My assumption is that any legal liability would rest on the agent you are working with, but once again, I am not certain as it is not something I have personally had to deal with.

Wayne Brooks · Answer

Assuming you're referring to listed properties, and you'd be making your offers through him, he'll get the buy-side of the commission.  Not likely you'll have much success reselling MLS properties though.  For the number offers he'd have to submit to get one accepted, let alone then resold, yeh he should get part of the assignment fee.

Jeremy T. · Answer

@Robert Vieira

If it's a fixer with a lot of equity and the seller is motivated to sell fast, provided you can ACCURATELY determine the ARV and repair costs, that's the way to do it.

However, If the property is in good shape and the seller wants to list with an agent, refer it.  Even if you don't gain much monetarily from the transaction, your ability to generate a lead and solve a problem for the seller will not go unnoticed.

Robert Vieira · Answer

What if it was a situation where I reach out to the owner of the property myself and find the cash buyer myself? Is 30% too much for the agent, just for sending me a list of properties?

In this situation, the agent would not  be representing me to the home owner or the finding end buyer.

Thanks for the responses. Very helpful thus far.

Ralph Pena · Answer

Like Lucas said" be very careful with trying to get paid from a licensee if you are not licensed! "

Ralph Pena · Answer

You can always do that, or pay them a one party fee agreement ( a commission). Say you lock the property up, tell him just bring you back X and he can make wateva extra he can get.

Lucas Pfaff · Answer

To add to @Wayne Brooks comment...reselling MLS properties will be difficult. If you are simply referring buyers to the agent you are working with (as opposed to putting them under contract yourself and wholeselling to the end buyer) it should not be much of an issue.

Contribution of Assignment Fee Paid to Realtor?

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