Comments on: Wholesalers: Who Pays Your Buyer’s Agent? http://reitips.com/who-pays-the-commission/ Real Estate Investing, Undressed: Tips, ideas and news real estate investors can use. Tue, 07 Feb 2012 18:38:00 +0000 hourly 1 By: Shane Adams http://reitips.com/who-pays-the-commission/comment-page-1/#comment-155250 Shane Adams Mon, 02 May 2011 09:24:00 +0000 http://reitips.com/?p=1346#comment-155250 Option 2 would be a great choice! Dealers and Buyers can also share the deduction for the agent. In this way, the agent would be paid diligently without either of the dealer or buyer, shouldering too much payment deductions. Option 2 would be a great choice! Dealers and Buyers can also share the deduction for the agent. In this way, the agent would be paid diligently without either of the dealer or buyer, shouldering too much payment deductions.

]]> By: Gary B. http://reitips.com/who-pays-the-commission/comment-page-1/#comment-148056 Gary B. Fri, 11 Jun 2010 05:09:18 +0000 http://reitips.com/?p=1346#comment-148056 It really depends on what has been agreed to by the buyer and the agent in the Buyer's Agency Agreement. In SC there are three different choices the buyer can choose on how the agents commission will or can be paid. If the Agreement doesn't state that the buyer will pay the commission from there personal funds, it could state that the seller would pay the buyers commission. In this case, the agent should have gotten with the seller before introducing the buyer and gotten a commission agreement signed with the seller beforehand. If the seller didn't want to pay the commission, I wouldn't introduce the buyer to the seller. BUT, if you don't pay the agent, you may get a reputation that you don't want with real estate agents. It really depends on what has been agreed to by the buyer and the agent in the Buyer's Agency Agreement. In SC there are three different choices the buyer can choose on how the agents commission will or can be paid. If the Agreement doesn't state that the buyer will pay the commission from there personal funds, it could state that the seller would pay the buyers commission. In this case, the agent should have gotten with the seller before introducing the buyer and gotten a commission agreement signed with the seller beforehand. If the seller didn't want to pay the commission, I wouldn't introduce the buyer to the seller. BUT, if you don't pay the agent, you may get a reputation that you don't want with real estate agents.

]]> By: James B http://reitips.com/who-pays-the-commission/comment-page-1/#comment-147838 James B Thu, 01 Apr 2010 00:03:17 +0000 http://reitips.com/?p=1346#comment-147838 Just read the other responses: To those I might add, get creative and don't always assume the commission has to be paid in cash at closing. You can "negotiate" discuss with the Buyers agent, and any agent involved. Creative ideas: Will agent take a promissary note, accept double or full commission on a future deal, accept a fee in lieu of full commission (with future deals), accept referrals and other consideration, etc. <br><br>Excellent points, may also be able to get the buyer "C" to be aware of the commission and agree to pay it or negotiate your price in the assignment or 2nd closing. Assuming this is a Seller A sells to Buyer U, U become Seller B and sell to your Buyer C in your transaction. Clearly, it is better to pay commissions on deals completed than not do deals because you don't want to pay commissions. Just read the other responses: To those I might add, get creative and don't always assume the commission has to be paid in cash at closing. You can “negotiate” discuss with the Buyers agent, and any agent involved. Creative ideas: Will agent take a promissary note, accept double or full commission on a future deal, accept a fee in lieu of full commission (with future deals), accept referrals and other consideration, etc.

Excellent points, may also be able to get the buyer “C” to be aware of the commission and agree to pay it or negotiate your price in the assignment or 2nd closing. Assuming this is a Seller A sells to Buyer U, U become Seller B and sell to your Buyer C in your transaction. Clearly, it is better to pay commissions on deals completed than not do deals because you don't want to pay commissions.

]]> By: Jared http://reitips.com/who-pays-the-commission/comment-page-1/#comment-5134 Jared Tue, 19 May 2009 12:00:45 +0000 http://reitips.com/?p=1346#comment-5134 It sounds like he is acting as a buyers agent and is trying to negotiate the best deal for his client. For me it would come down to how many other people were interested in taking the deal w/o this commission. I would stall if there were no others to see what came around before I gave him my answer. Even though the investor is really the party responsibe for the agents compensation, some money is better than no money and he would certainly be able to pitch that to his investors in the future. I believe "The flip man" on Youtube covers this answer also. It sounds like he is acting as a buyers agent and is trying to negotiate the best deal for his client. For me it would come down to how many other people were interested in taking the deal w/o this commission. I would stall if there were no others to see what came around before I gave him my answer. Even though the investor is really the party responsibe for the agents compensation, some money is better than no money and he would certainly be able to pitch that to his investors in the future. I believe “The flip man” on Youtube covers this answer also.

]]> By: Jared http://reitips.com/who-pays-the-commission/comment-page-1/#comment-149309 Jared Tue, 19 May 2009 12:00:00 +0000 http://reitips.com/?p=1346#comment-149309 It sounds like he is acting as a buyers agent and is trying to negotiate the best deal for his client. For me it would come down to how many other people were interested in taking the deal w/o this commission. I would stall if there were no others to see what came around before I gave him my answer. Even though the investor is really the party responsibe for the agents compensation, some money is better than no money and he would certainly be able to pitch that to his investors in the future. I believe "The flip man" on Youtube covers this answer also. It sounds like he is acting as a buyers agent and is trying to negotiate the best deal for his client. For me it would come down to how many other people were interested in taking the deal w/o this commission. I would stall if there were no others to see what came around before I gave him my answer. Even though the investor is really the party responsibe for the agents compensation, some money is better than no money and he would certainly be able to pitch that to his investors in the future. I believe “The flip man” on Youtube covers this answer also.

]]> By: Matt http://reitips.com/who-pays-the-commission/comment-page-1/#comment-4820 Matt Tue, 19 May 2009 04:45:32 +0000 http://reitips.com/?p=1346#comment-4820 Sounds like an easy deal still. Nothing wrong with the agent asking for full upfront (unless they're a bit "pushy" about it ;) ), then re-negotiate a bit from there depending on the numbers. All can still win on this. Sounds like an easy deal still. Nothing wrong with the agent asking for full upfront (unless they’re a bit “pushy” about it ;) ), then re-negotiate a bit from there depending on the numbers.

All can still win on this.

]]> By: Eli Perkins III http://reitips.com/who-pays-the-commission/comment-page-1/#comment-4819 Eli Perkins III Tue, 19 May 2009 04:45:23 +0000 http://reitips.com/?p=1346#comment-4819 It just so happens that I was wondering this same exact thing. You explained it for me to where I dont feel bad now. You're right about "spreading the love" when it comes to making sure those that help you complete deals are happy. A bunch of small deals sure on a consistant basis beats one big deal. It just so happens that I was wondering this same exact thing. You explained it for me to where I dont feel bad now. You’re right about “spreading the love” when it comes to making sure those that help you complete deals are happy. A bunch of small deals sure on a consistant basis beats one big deal.

]]> By: Eli Perkins III http://reitips.com/who-pays-the-commission/comment-page-1/#comment-149307 Eli Perkins III Tue, 19 May 2009 04:45:00 +0000 http://reitips.com/?p=1346#comment-149307 It just so happens that I was wondering this same exact thing. You explained it for me to where I dont feel bad now. You're right about "spreading the love" when it comes to making sure those that help you complete deals are happy. A bunch of small deals sure on a consistant basis beats one big deal. It just so happens that I was wondering this same exact thing. You explained it for me to where I dont feel bad now. You’re right about “spreading the love” when it comes to making sure those that help you complete deals are happy. A bunch of small deals sure on a consistant basis beats one big deal.

]]> By: Matt http://reitips.com/who-pays-the-commission/comment-page-1/#comment-149308 Matt Tue, 19 May 2009 04:45:00 +0000 http://reitips.com/?p=1346#comment-149308 Sounds like an easy deal still. Nothing wrong with the agent asking for full upfront (unless they're a bit "pushy" about it ;) ), then re-negotiate a bit from there depending on the numbers. All can still win on this. Sounds like an easy deal still. Nothing wrong with the agent asking for full upfront (unless they’re a bit “pushy” about it ;) ), then re-negotiate a bit from there depending on the numbers.

All can still win on this.

]]> By: Scott Phillips http://reitips.com/who-pays-the-commission/comment-page-1/#comment-4630 Scott Phillips Tue, 19 May 2009 00:24:40 +0000 http://reitips.com/?p=1346#comment-4630 Hi JP, I agree with what you said. There are lots of variables that were not mentioned in the question, but I would doubt if the A-B seller would be willing to pay it so I would consider explaining to the agent that you normally assign these deals with minimum profit but you are going to propose a 3% commission to be split between and your B-C buyer. If there is still lots of profit, give the agent a bonus. Otherwise, explain to them that you will try to protect them with as much commission as possible on future deals. Hi JP,
I agree with what you said. There are lots of variables that were not mentioned in the question, but I would doubt if the A-B seller would be willing to pay it so I would consider explaining to the agent that you normally assign these deals with minimum profit but you are going to propose a 3% commission to be split between and your B-C buyer. If there is still lots of profit, give the agent a bonus. Otherwise, explain to them that you will try to protect them with as much commission as possible on future deals.

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