# Buyers agent questions



## gypsymama (Feb 22, 2006)

We are selling our home without a real estate agent and instead have an attorney that looks over and does paperwork for us. I've had a couple of agents ask for 3% commission on the sale and they get uneasy that I have professional representation. 

Is is typical for a for sale by owner to pay 3% commission to a buyers agent? (ohio)

Are there any special ins and outs I need to be aware when dealing with a buyers agent?

Just trying to figure out what they are doing for me that I should be the one paying their fee.


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## moonspinner (Jul 2, 2002)

I would simply state in your advertising "no agents."


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## myheaven (Apr 14, 2006)

You can put in that the buyers agent will be payed by purchaser. I do not know the law of Ohio. I know in North Dakota a buyers agent would have been payed by the purchaser not the seller.


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## farmerted (Dec 21, 2012)

In Missouri 3% for buyers agent is normal sometimes 3.5%. We sold our house in December with an agent who also took 3%.

I was not a fan of real estate agents, buyers or sellers, but if we hadn't had both we would not have been able to sell our house. If a buyers agent have clients that are looking for a property like yours they will bring it to their clients attention. I figure most people looking for houses would just do it themselves, I look at houses even when I can't afford them. But people are really busy and that is why they hire a buyers agent. I think both agents earned their 3%, they do a lot of work, a lot of things you would never think of. It would be like putting in a chimney, you wouldn't do it if you didn't know how, why would you do the same in a transaction potentially exceeding $100,000?

It will probably take less time to sell your house, a few extra payments can add up quickly. Sell it in May or August, that is a lot of mortgage payment for a home you don't want to own.


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## gypsymama (Feb 22, 2006)

Thanks all, the the input.

Just wondering what experience others have had. We have had some agents bring clients and have had no problems working with us. I always figure there's more than one way to skin a cat and if an agent is creative and thinks outside the box, they can find a way to work the deal, but then I start to doubt myself when agents won't work with us unless a contract is signed and we pay 3%.


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## farmerted (Dec 21, 2012)

we had to write a $7k check to move out of our house. The market today is not like it was in 2006.


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## Conhntr (Aug 7, 2010)

Gypsy if you think about it all the money comes from the buyer. Just look at your "take home money"

If someone offers you 97k
And someone else offers 100k minus 3% for buyers agents 

Whats the difference? As long as your walking away with the same money it dosnt matter. And if they bring along the right buyer it might be more money!


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## farmerted (Dec 21, 2012)

My wife brought up a good point, don't worry about it until you have to. If you have to you can write into the contract potentially as well.


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## Solar Geek (Mar 14, 2014)

IN WI and IL, it is very common to have buyer's agents. We have moved 15 times and used buyer's agents on the last 3-5 places. My sister is a realtor.

BUYER's AGENT means that *unlike *EVERY other real estate agent who MUST by most state's laws work in the SELLER's best interests even it he/she is showing you the buyer the house, a BUYER's agent works only for the buyer.

If any agent shows your house, unless you have stated NO COMMISSIONS, NO AGENTS on the listing and/or told every agent that walks in with a potential buyer that you are not paying commission they will likely not show the house. They often let the buyer walk through alone, at least in our experience. But many of the realtors we worked with would not show us or even tell us about any FSBO homes. Since FSBOs are generally not in the MLS system, they do not get the traffic of buyers that those with realtors do. But each house is unique. We have sold 2 homes "by owner" and did not allow agents any cut but those homes were in very high traffic areas (buyers literally cruising the streets looking for FSBO signs) and we sold quickly. We also had an attorney to look everything over/

In both WI and IL, the standard commission is 6%. The agents split it different ways but usually the listing agent (your agent as seller) gets either 3.5% or 3% and the other agent who brings in the buyer gets the other part.

By not allowing agents with potential buyers into your home, you do cut out alot of traffic. 

Here are the FAQs on COMMISSIONS for the state of Ohio. Note that some are real requirements and others are set by each realty company. 

http://ohiorealtors.org/legal/topics/compensation-commission-fees/#Commissions


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## wharton (Oct 9, 2011)

Gypsymama, You have two interesting comments in your posts. In my opinion an agent that would get nervous that you have hired a lawyer to complete the transaction is somebody that would make me nervous. These transactions are about one of the simplest things a lawyer does, and often 90% of the work gets done by experienced, yet far less expensive staff in the lawyer's office. As an agent, unless you are trying to pull something, I can't imagine caring about your lawyer in the least. 

The other issue is signing a contract with a buyer's agent. I can understand a buyer's agent wanting to protect their interest, and not have you agree to cut them out of the deal, and save the buyer and yourself a couple of thousand bucks. OTOH, I would only sign an agreement that limits the commission to the agent and any potential buyers that he brings to the table. Such agreement would be extremely limited in scope, and duration, and have zero bearing on anything other than that specific agent and clients that he alone brings to the deal. 

Be careful, strange things happen if you don't protect yourself. My own accountant, a CPA ,MBA and college prof, just headed of a scam while listing her home. The agent presented he the listing agreement and said that it was, "all the standard stuff, nothing worth spending hours reading", Well she isn't the type to fall for that. 

In the end she found 

#1 A $1200 junk fee at closing, no explanation, no value to the seller, just a big chunk of cash to line the broker's pocket.
#2 An eight month listing duration, in this market six is standard
#3 The big, big issue, hidden way in the back of the packet. A clause that gives a commission to the listing broker for TWELVE MONTHS after the listing expires, if the property is sold to anyone, by anyone. 

Bottom line is that you need to protect yourself. Nothing wrong with doing business with a buyer's agent, if you handle the situation on your terms, and with the guidance of your lawyer.


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## Rocky Fields (Jan 24, 2007)

Solar Geek said:


> In both WI and IL, the standard commission is 6%. The agents split it different ways but usually the listing agent (your agent as seller) gets either 3.5% or 3% and the other agent who brings in the buyer gets the other part.


The usual commission split in WI/IL is 1/4 to listing realty, 1/4 to listing agent, 1/4 to selling realty, and 1/4 to selling agent.


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## joshcheney (Feb 2, 2011)

Full Disclosure - I'm an active agent in Maine. What I say is true for my market, YMMV, etc.

When I'm working with a buyer, if I know of a FSBO property that they might be interested in, I'll treat it like any other property - if it will work for them, then I'll help them try to buy it. If the seller will contribute to covering my paycheck, then we will do that. If not, we will make other arrangements to make that happen. However, what I've found is that the buyers that I work with are turned off by the prospect of having to make those other arrangements, to the point that they may just pass on that property (especially if it's a "buyer's market").

As someone said earlier, how the costs play out precisely isn't important - what is important is the amount of money that you walk away with, and each offer needs to be evaluated based on that parameter. It's entirely possible that by paying the buyer's agent commission, you are able to close a better (for whatever definition of better you want: speed, profit, ease, etc) deal than if you chose not to.

Josh


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## Evons hubby (Oct 3, 2005)

wharton said:


> an agent that would get nervous that you have hired a lawyer to complete the transaction is somebody that would make me nervous.


As an agent I can tell you that a lawyer is almost as good at killing a sale as is the neighbor who doesnt want a property sold. Its a good policy to keep both of these people as far away from buyers and sellers as possible.


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## ChristieAcres (Apr 11, 2009)

gypsymama said:


> We are selling our home without a real estate agent and instead have an attorney that looks over and does paperwork for us. I've had a couple of agents ask for 3% commission on the sale and they get uneasy that I have professional representation.
> 
> *As a Seller, be prepared for possible Agent represented Buyers. It is a good idea to have terms for commission decided up front.*
> 
> ...


 What a Buyer's Agent will do for you, namely the most important thing, is to bring you a Buyer. In most cases, a sharp Agent will insure this Buyer is already pre-approved for a loan. 

So, say I am working with a Buyer. I have a choice to show my Buyer properties listed on the MLS and/or FSBO's. Since I have already put time into this Buyer, which includes educating as much as needed, and insured he is pre-approved for a loan? I don't work for free, so I will show my Buyer only properties that offer a commission to be paid to me. If an Agent sees a property paying 3% on the MLS and then also a FSBO paying 1% or Buyer paying? I guarantee you that Agent will show the MLS property over the FSBO any day of the week. If you don't offer a commission that is competitive in your area, you lose potential Buyers.

If you don't want Agents to show your home, then prohibit them.


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## joshcheney (Feb 2, 2011)

Yvonne's hubby said:


> As an agent I can tell you that a lawyer is almost as good at killing a sale as is the neighbor who doesnt want a property sold. Its a good policy to keep both of these people as far away from buyers and sellers as possible.


That depends on the lawyer. 

There is one here in town who has saved several deals by explaining to a party why it's important to honor the terms of a contract (it's surprising how many people think that they can single-handedly re-negotiate the terms of a contract at the last minute). I value his expertise, and his willingness to remind people of the right way to do business. 

On the other hand, there are some around who feel that their role in the transaction is to demonstrate that they are smarter than everyone else. In one situation, I helped a buyer write up an offer using our standard Maine Association of Realtors form (which is very clear and well-proven in court/mediation). The seller's lawyer reviewed it (which was *perfectly* fine), and thought that it was more appropriate for him to take 4 hours to write a contract up from scratch as a counter offer. They were materially the same contract, but the seller incurred some additional costs in preparing it. Additionally, where I am not an attorney, I couldn't offer my buyer a clear representation of the counter offer, so he had to have his attorney review it, incurring even more expense. 

In short, a good attorney is a tremendous asset. A lawyer who misunderstands his position is a menace to an otherwise mutually beneficial deal.


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## wharton (Oct 9, 2011)

Yvonne's hubby said:


> As an agent I can tell you that a lawyer is almost as good at killing a sale as is the neighbor who doesnt want a property sold. Its a good policy to keep both of these people as far away from buyers and sellers as possible.


 Generally, I would disagree, particularly since I strongly push my buyers into dealing with a local firm that also owns a settlement agency and title insurance firm. We have access to several of these in the region and they are generally noted for being fast, reasonable, and very careful to make sure everything is 100% kosher. 

OTOH, as Josh points out, I have seen several of my clients screwed by their own lawyers, who take my standard, state approved, state Realtor board drafted contract, and waste a week or two, whilst needlessly rewording a clause or two, to generate billable hours.

My all time favorite was a young, clueless couple who was really wasting my time, since their own lawyer was simply not cooperating at all in getting to the closing table. After a month of zero performance on their lawyer's part, I called them and gently explained that if their lawyer didn't immediately do a 180* change, and start to quickly and professionally expedite the deal, I would not be signing any contract extension, and "their" new home would be back on the market. After a quick call, they got back to me with the fact that their lawyer was doing the best he can, but could not proceed until HE had a copy of the house plans. I responded with the fact that I didn't really know why, but they were being played. They weren't getting a copy of the plans for this clown, and I would be happy to recommend competent council, if they still wanted the house, and needed a real lawyer. However, as far as I was concerned, it doesn't sound like we will be able to do business. A few minutes later, they call back again and report that the secretary at his office admitted, under extreme pressure, that her boss has been on an African Hunting Safari for the last month, and instructing her on how she is to lie to clients to stall them until he returns. And lawyers wonder why so many people hate them?


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