General Questions;
Since 2006 when Short Sales the norm;
1) Have you been asked / told to cut your commission?
2) Did you agree to do it?
3) How much income do you estimate you have been denied / lost since 2006?
You need to be a member of Short Sale Superstars to add comments!
**********************************
like buttons
Replies
Let me add that before I reduce the commission, I make sure the legal fees make sense. Some attorneys around here are downright greedy. So I tell the attorney they're getting $1,200 and if they can't work with that, I find an attorney who can. AND they have to do a title search for me before I give them the file. Haven't had a problem yet but I've been on the buyer side and have seen seller attorneys get anywhere from $2,500 to $4,000 and the commission is reduced. Insane!
I have had to reduce my commission twice since 2006. PennyMac supposedly has a "corporate guideline" that they will only pay 5%. I don't recall the 2nd one. Commission reductions seem to be a thing of the past or at least I hope so.
Yes, yes, and probably $3 to $4 k. Not a big deal.
I've reduced commission from the proceeds maybe a half dozen times. In all but 1 the seller paid me by making payments to me after closing. They were happy to do so. I get little $200 checks in the mail quite frequently. The lender does not dictate my commission. My listing agreement does. The lender has every right to reduce the amount they are willing to pay from the proceeds of the sale.
And my co-broke amounts are guaranteed. I never reduce or increase them. Depending on the property I pay 2.5 to 2.75%. Selling agents should not have to just "guess" what they will be paid.
Agents need to know how and when to get paid. Relying on others to get us paid is foolishness. Homey don't play that :)
But having said all that I have not been asked to reduce a commission in about 2 years. And we sale about 50% of our own short sales.
Hi Bryant, I've reduced mine .5-1% maybe 3 times over 2 years and only when I suggested it b/c we were so close to min net and it was either that to close it or nothing. I would never reduce for a traditional sale unless if was a repeat client. Lately, I 've been thinking I'm getting cheated on this by the sellers (especially when they get huge junior liens waived)- b/c while they are appreciative they never offer to reimburse me (or my broker) given their hardship. How do you get them to pay you over time on future sales? I'm worried about bringing it up, as in I can cut our commission to close it if you reimburse us... Is there any chance we could be in violation of of any short sale rules by requesting this? Should I bring up this scenario at the time of the listing or wait until we get into such a mes?
I'd be wary of charging the client (buyer OR seller) for any sort of payment. Arm's Length Transaction clearly states that no other deals are in play and that the agent is not receiving compensation from any of the parties. It's a short sale. You know this can happen. It's just the cost of doing business; first duty is to your client and getting that debt forgiven. Our paycheck is not and should not be the first priority.
Hi Wendy, i checked on a recent IndyMac short sale affidavit and you are correct the seller can not reimburse for commissions. Bryant may have had older sales where this wasn't a requirement or small lenders that didn't require it. The buyer's agent recently had to do a cut also to chip in on termite treatment. The seller wrote to express him extreme gratitude and that was thanks enough.
I'll start;
1) YES, on at least 10 short sales I was asked / told to reduce my commission.
2) NO, I told the rep from the bank they needed to reduce their salary by an equal amount and put it on the HUD as a personal contribution to the lender (their employer). They didn't, I didn't.
3) NONE