Buyer wants my commission towards closing costs with HAFA SS
So I just got a HAFA SS approved and I represent both buyer and seller. Now I got the sellers mom telling me I have to give her son 2% from my commission. I already worked my butt off getting the home 14K cheaper than they wanted to take working my way up to the asset manager and I already got all of his CC paid for.
Does anyone know if HAFA wont allow any portion of commission to be contributed to a buyer? Where would the money go besides discount points in the CC are already paid?
ugh.......
Replies to This Discussion
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Permalink Reply by Jeff Payne on
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Just say NO. Why would you have to contribute to the buyers closing costs? Someone is trying to strong arm you. I would simply tell them that you can not pay an unlicensed person a referral fee and see if they go away
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Permalink Reply by Travis Davies on
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I think she believes i can just write him a check at closing or give him 1% from the title co...
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Just take the time to explain a few things to them. It appears that he is getting by without paying any closing costs because you negotiated that for him, it appears that they want you to break the law and pay an unlicensed person a referral fee.
What type of financing is he doing, let me guess, 100% financing? Depending on the lender, they may not allow him to get cash back at closing or may limit it to the amount that he has already put into the sale.
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Permalink Reply by Beverly Cibulsky on -
Travis?
I believe you said this is a short Sale?
Who wants the 2% Buyer or Seller?
Regardless, let mom try and kill the deal! JUST SAY NO! You dont want to expose yourself to possible Short Sale Mortgage Fraud, or actual Mortgage Fraud. I am sure the buyer's lender would not be happy knowing the buyer received funds "off" the HUD settlement statement, let alone if you some how tried to put this fee on the HUD.! You should not write anyone a check, and I would almost bet the title company would not! Plus this would need to be disclosed to "all parties"! Seller, seller's lender, buyer, buyers lender... (this would probably kill the deal in itself!)
This is a good example of "if something happens after the closing" You most certainly could be blamed for what they wanted! Plus, E & O, etc, etc, etc.
Tell mom, they will get a nice Welcome Mat for the front door of thier new home as a closing gift!
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Stick to your guns, tell Mom to mind her own business and be willing to walk away from this quickly. They are just testing you.
I am always thinking in the back of my mind, what if this lady was planted by someone to do this to see if you would agree, kinda like the secret shopper for the FBI?
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Permalink Reply by Deidre St. Romain on
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Just say NO. - just read that Jeff Payne says the same!! Seriously it works if you just say the word and NOTHING ELSE and see what they do. Calmly, quietly, firmly NO. It generally works and if it doesn't walk away. I know I talk a tough game but I'm talking to all of us who are from time to time "held up" by buyers who think they have us over a barrel. Just say NO!
P.S. and Yeah what Beverly said!
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Hey I think we ALL agree on a SS we earn every red cent! I just talked to her for about 40 minutes. It basically boils down to a misunderstanding from another bad agent in her previous transaction (who isnt licensed anymore) who gave her $ on the side a number of years ago, so she thinks we all can do that.
Instead of telling her no I thought I would use the tried and true third party approach and show her it all has to be disclosed by all the parties involved (I named about 10).I emailed the admin department of HAMP and asked for their policy. They sent me a nice long email with exact sections highlighted, which was perfect for this. I just underlined a few of them and passed it along.
She was pretty defensive at first but after talking to her and sharing all the "what if's" that can go on with these hard transactions she calmed down quite a bit. I have to say that knowing short sales and people well is definitely the key to our business. I''m thankful we have forums like this for all of us to share experiences and information with.
Now quit reading this and go call a bank!
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Permalink Reply by Donna McClelland on
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If only buyers had to do our jobs for a day, they wouldn't be asking for your commission that's half as much as in the old days and that you have to work 10 times as hard for now. Show your greedy buyer who can't even afford his own closing costs and probably shouldn't be buying a home anyway the paragraph on the Arms Length Affidavit where it states that there can be no hidden agreements or profits to any of the parties. If you want to be open with the profit to this party to the contract, you have to disclose it on the HUD and when you do, the first lien holder is going to want that money - so ultimately, you will be giving your hard earned commission to the bank! No good deed goes unpunished! (I sound bitter, don't I? Sorry, had a long, hard day).
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Permalink Reply by Ray Snook on
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Don't be intimidated.Warn her that she is trying to incite you to commit a crime and that if the bank knew about it they would cancel the contract. Also remind her that commission is paid by the seller to the agent and the buyer has no claim on it at all - do not bow to her pressure - the son would have to cancel the contract in order to lose you your commission, but you would keep your license! . If you have a great approval find another buyer - even if you don't double-end it you will be able to sleep at night knowing you did the right thing.
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Permalink Reply by Bryant Tutas on
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This is going out in the newsletter today
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Permalink Reply by Eric Mieles on
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I want to throw another point in here and add that sometimes we need to remember that we are in fact professional sales executives. I only say that (And it's not a bad word) because being that we are professional sales executives we must always be aware of using professional and ethical sales tactics.
Now he pointed out that it was a misunderstanding and she 'Thought". My point being that sales is a transference of feeling, understanding what the client emotionally needs and wants and giving it to them.
If a proper discovery was done upfront, taking into consideration all possible scenarios that may play out and truly understanding what there desired outcome would be, we then can go back and address possible scenarios like this.
We must also remember using great questioning skills. By going back and asking her 1st, 2nd and 3rd level questions he would have been able to get to the ROOT of what it was that she was thinking and then been able to properly just address it and move on.
By having her dominant motivation, he could have addressed this and painted a picture of what she could have by moving forward and being done or what she CANT have by trying to get money that's not hers.
Ultimately I feel we must always consider these tried and true professional and ehtical sales systems to get the job done.
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Permalink Reply by Thom Colby CA Brkr 888-391-5245 on
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First, this is one of the reasons we do not double-end in our brokerage. Having said that - your original questions is conflicting - you say the SELLER wants 2% but then it sunds like it's the BUYER that wants the 2%. Most likely the Seller cannot receive anything from your commission in a a short sale -HAFA or not.
Second, assuming your Byuer signed a "Buyer's Representation Agreement" that outlined the terms of your agreement with them, provide another copy and remind them they already agreed to these terms.
Third, just say NO. I'm sure you have worked hard for both Buyer and Seller and deserve the commission. What are they going to do if you just say NO?
But, make sure you are doing what's in the best interest of your clients without the influence of the commission.
Best of luck,
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