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Buyer agent fees

Posted by Mike Rosania on January 22, 2012 at 4:51pm in Short Sale Discussions
The agent for the buyer on one of my listings is charging his buyer a 2000 fee on the buyer side of HUD. Is there anything I need to worry about. It is a 40k property and his buyer agreed to pay him additional commission which is fine by me I just don't want the deal the get kicked back because of the charge 

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Replies

  • Mike Rosania January 23, 2012 at 9:27am

    Thanks for the replies, I talked to lender and they dont care as long as it dont affect net and nothing going to seller.

  • Mike Rosania January 23, 2012 at 8:13am

    Im just going to leave it on there and keep a copy of the buyer broker agreement showing the buyer agreed to pay the buyers agent $2000 broker service fee.

  • Bryant Tutas January 23, 2012 at 1:34am

    It depends. If it's a Freddie Mac deal they will try and limit the agents to total of 6% even if the fee is being paid by the buyer.

    If the buyer is paying cash for the property then they can always just pay their broker off the HUD since RESPA does not apply to a cash deal. Or they just pay their broker before closing if it's a financed deal.

    I'd just make the agent aware of the possibility of the lender balking at the $2,000 on the HUD. They may just have to sort it out with their buyer.

    • Jeff Payne > Bryant Tutas January 23, 2012 at 7:15am

      An agent can "list" a buyer just like a seller with a buyer broker agreement.  Happens often when dealing in low end or markets with low average commissions.  Agent and buyer sign an agreement stating that agent is to be paid X amount and if the commission is lower, the buyer makes up the difference.

      Agree with Bryant that the lenders may balk at it but if it is cash, no worries.

      • Mike Rosania > Jeff Payne January 23, 2012 at 7:23am

        Thats exactly what it is. Buyer will not pay it though unless on HUD? Lender is not requiring to approve final HUD as long net doesnt change from whats on approval. Its a cash deal.

        • Jeff Payne > Mike Rosania January 23, 2012 at 8:07am

          Mike, with a cash deal I dont know if it has to be on the HUD.  Maybe to be safe put it on the HUD as aPOC

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