Replies to This Discussion

Permalink Reply by Sherrilee Denton on July 21, 2010 at 7:29am

Are they asking for a reduction in your 6% commission or are they asking for you to contribute 1% of your commission to them?!? That is what Wells Fargo who is the 2nd on my short sale listing is requesting of me, but WF is requesting I contribute 2% of my commission to them! My short sale is also dual agency with two brokers from two different offices, What a joke. I will not allow my commission to be contributed to them and have held firm. Wells initial counter to me was their investor guidelines will not allow more than 4% commission therefore I had to contribute 2% to them!!! LOL My come back to the 2nd was absolutely not! My broker won't allow it and there are two brokers involved, plus I quoted the Feddie Mac clause on 6% commissions and said this is standard (even though this is not a freedie or fannie loan). They are basically asking us to work for nothing! After a 3 week stand still on Wells part we are going back to the first to ask them to contribute an additional 1% to the 2nd. Wells said they would be agreeable to that.

'm not sure how the first will respond yet to us coming back & asking for an additional 1% for the 2nd who is already receiving $3K, but I do know that if any money is on the table including my commission contribution the 1st will want it, so the 2nd would never see it any way if I was to offer! Also the first already agreed to 6%, after I agreed to reduce it from 7%.. I reduced to 6% but I will not contribute, period.

So hold firm to your principles. They are required to try to get as much money as they can and if that means trying to squeeze it from the realtors they will. We do not have fiduciary duty to contribute our hard earned commission to the lenders. Call their bluff, let them know your broker won't allow it, the home will go into foreclosure and they will get ZERO and hold firm. Of course you are being nice through all of this :)

Permalink Reply by Karen Mathers on July 21, 2010 at 9:52am

That is why it is crazy, they are not asking for our commission they just want us to lower it. If we did that it would go to Bank of America and not RBC? They are getting a flat fee and our commission will not affect them . . . why should they care?

Permalink Reply by Katerina Gasset on July 21, 2010 at 12:19pm

Hold tight, tell RBC that you will not negotiate your fee, your broker won't allow it.
Then go back to BofA and tell them RBC needs 5K.
They will say no and come back with 3K. You can fight for the 3K because that is standard with BofA.
Then you get the money from the seller for the difference.
We always tell our sellers what the deal is and for them to save their money up for stuff like this, especially if they are not making their mortgage payments.

Permalink Reply by Brigitte Powell on July 22, 2010 at 1:17am

They just want more money and are attempting to bully you into it. If all involved are desperate....maybe you want to give a "little" (don't give in, this is still a negotiation- I found out the hard way) :-) Nothing is ever FAIR......so do what we are supposed to be good at :-) - negotiate. Whatever you give in to will go to the second of course.......been there done that just two weeks ago :-) and it was the Mortgage Insurance Company that asked for money. Mind you, they didn't ask for part of our commission...they asked the Seller :-) to pay 3,000 at closing which she didn't have AND which they knew. So, either say no, your broker will not let you do that, or negotiate a lesser amount. Good luck :-)

Permalink Reply by Brigitte Powell on July 22, 2010 at 1:22am

Judy, BOA didn't care what we did with our commission. They were giving us 6% then they told us that the MI wanted 5,000 from the Seller......THEN :-) we said Seller has no money WE (both agents) will give part of our commission....AND the Buyer will give some money. TADA!!!! LO and BEHOLD when I got the worksheet to verify acceptance, the 3,000 for the MI had gone from 3,000 to 2,000 :-) and the 5,000 we were contributing also went to the MI for a total of 7,000
Lesson learned. Negotiate negotiate.........I think I made 5.00/hr on that one.

Permalink Reply by Brigitte Powell on July 22, 2010 at 1:23am

sorry all.....MI asked for 5,000 Agents gave 3,000 and buyer gave 2,000

Permalink Reply by Karen Mathers on July 22, 2010 at 8:12am

Ok, I am fighting back. I am standing my ground! Unfortunatly I am the buyer's agent but the listing agent has never done a short sale, so I am helping him. I ended up writting a letter to him saying I am not going to reduce my commission and I will take my buyer and go find another home!! I wish she would. We are getting a new HUD with $5,000 to the 2nd and we will see what BoA says. I will let you know what happens! I love you all!!!!!!!!! Thanks

Permalink Reply by Janet Nation on August 7, 2010 at 3:59pm

If I am reading this correctly, RBC is asking the overall commission to be reduced from 6% to 5%. You helped the lisitng agent with the process? So you split the commission 50/50. I disagree with all of you, this is a short sale, commission is not guaranteed, you take your chances and hope for the best. A 1% deduction is not that terrible. The time spent finding your buyer a new home may not help you financially; time is money. What are you honestly going to tell your buyer why he/she cannot purchase the home they had their hearts on???????????

Permalink Reply by Emily S. Knell on August 7, 2010 at 4:07pm

Do NOT reduce your commission, negotiate with BofA to pay the $5k, I don't know what your purchase price is but BofA should be paying off the 2nd at 10% of what is currently owed. Redo your HUD & CC the SVP through Equator.

Do NOT reduce commission, stand FIRM. BofA is not going to take the house to auction over $3k.

Permalink Reply by Brigitte Powell on August 8, 2010 at 2:13am

to Janet Nation: Your listing agreement (citing the commission YOUR COMPANY is asking) is with the Seller NOT with the servicer or the investors. However, YOU can reduce your commission to whatever you want., but there are many of us who will NOT reduce the commission because we worked hard for the minimum wage we end up getting after all the time spent. In the longrun they may get part of your commission anyway, in one way or another. The rule about not asking the agents to reduce their commission is so much bull anyway. Personally I will hold them to it and will not allow servicer or investor or MI to tell me to reduce my commission agreement with the Seller unless I decide to do it for my Seller. Semantics I know.

Permalink Reply by Janet Nation on August 8, 2010 at 3:21am

Nobody likes to reduce their commission, and I certainly would not do so in a traditional transaction or even to take a listing where the home owner may want me to compromise my value, but short sales are different animals, every transaction is different and the outcome is unknown and a Broker/owner should know this. In a short sale the sellers are often not in a position to shell out any money, and on the HUD1 the attorney is showing the proceeds coming from the buyer (at least in my area in Long Island). If you do enough of these short sales a good percentage of them will die and EVERYONE walks away empty. Look I'm just giving my opinion, I think Karen should take what she can and run, don't stress it. Five percent of a number is better than zero percent of a number. Maybe you'll get referrals from this buyer, and make up for what you were hoping to get on this transaction. All the best.

Brigitte Powell said:

to Janet Nation: Your listing agreement (citing the commission YOUR COMPANY is asking) is with the Seller NOT with the servicer or the investors. However, YOU can reduce your commission to whatever you want., but there are many of us who will NOT reduce the commission because we worked hard for the minimum wage we end up getting after all the time spent. In the longrun they may get part of your commission anyway, in one way or another. The rule about not asking the agents to reduce their commission is so much bull anyway. Personally I will hold them to it and will not allow servicer or investor or MI to tell me to reduce my commission agreement with the Seller unless I decide to do it for my Seller. Semantics I know.

Permalink Reply by Karen Mathers on August 8, 2010 at 7:09pm

I am not surprised when they try to reduce my commission. It goes with the territory when you do short sales. In this case the 2nd has not asked for part of my commission - they just want to see it reduced. They are getting a flat fee from the first regardless of what the commission is. Even if they get the $5,000 they are asking for, they tell me they will not approve the short sale till I reduce my commission? If I reduce it, the proceeds will go to the 1st lien holder and not to them. Right now we are waiting for the 1st lien holder to get the results from a new BPO. RBC bank is not backing down on the commission reduction . . . so the saga continues.