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In february I met with a realtor and he had me sign some documents that he would look for houses and represent me. Today me and the wife to be came across an area that we really liked. We stopped and talked with one of the builders and pretty much convinced that we are going to buy. Now the realtor didnt help and was not involved in this process. I havent signed anything yet with the builder but I am assuming if I do I can get in trouble. I was told by someone that I can try to negotiate a deal with the realtor to get a cut of the commision if I involve him in this deal or I can wait for the contract to expire that I originally signed. Is this acceptable or frowned upon? Any comments and advice would be appeciated.
Don't cut your nose off despite your face! If you are happy with your realtor allow him to continue to represent you as you purchase the home from the builder.
I don't know where you are located. But here, in Colorado, the builders are not required to used Real Estate Commission approved contracts. The builders are allowed to use their own contracts that a slanted to their favor (of couse). You'd be well advised to have representation during the process.
I suppose you can ask the realtor to cut his commission but it's more likley to benefit the builder than you since the seller pays the commission. If you are not represented by a realtor it's to the builder's advantage. However, builders usually don't reduce the sale price simply because you are not working with a realtor. The builders will not want to offend the realtor community becasue they produce the majority of the buyers. Nevertheless, if the builder has offered (for real - in writting) to reduce the sale price - ask your realtor to match it. Be open and honest with your realtor - it's the best way to do business.
Best wishes.
READ the documents that you signed with the real estate agent. If that agreement states that the agent represents you exclusively, you may owe him a commission even if you go directly to the builder and buy the house. So first understand what you signed. Then make a decision...if you feel you need the representation of the agent and feel they will represent you well, use them. If you do not want to use that person and are under contract to do so, wait until that contract expires...THEN go to the builder.
Please check and make sure what that contract obligates you to do. I cannot imagine that any contract precludes you from looking for a home on your own, finding one, and NOT having to pay a buyer's broker. If the broker showed you, told you about, discussed, or any other thing that new house with you, maybe they'd have a case. But I cannot imagine any contract that says if you find something on your own without their help or expertise that you're obligated to pay him. And even if it does, I can't imagine that would hold up in court or arbitration. The person actually has to work to get paid. If he didn't find this house and didn't aid you, then I say he doesn't get paid. But it's always wise to check with someone who actually knows if what I say is true!!
Well, most people will say lots of things without knowing what they are talking about. First, read what you signed and see what it says. Most builders, not all, but most actually charge you the same price regardless of if you have an agent or not. If it's a production builder, they probably won't give you a discount anyway. If you have questions ask the builder straight up that you've been working with an agent and if they offer a discount if you don't involve them. (BTW, if they answer yes be very wary because it shows a lot about moral values or lack thereof)
Second, have you worked with your Realtor or stayed in touch? Did you sign it and then all communication go away? If you've been working with your agent have they provided value? Do they deserve to get paid if they provided value?
My sister-in-law simply contacted the broker/office, and explained that they wanted to get out from under the contract. Alot of discussion went on and alot of 'convincing' them to keep things as they were went on, but in the end, after much insistence, the broker signed some sort of a simple release form and they bought without their agent. Just thought I'd add this because she said it was fairly easy to do and so maybe you can see if its possible in your case. If the contract is up at the end of the month, thats not really too far off unless you're needing to buy right away.
So many people seem to think that what agents do is find houses and open doors. That's the tip of the iceberg - a lot of the work goes on (a) after you find the house, when you're making an offer/signing a contract and (b) from the time you have a contract to closing. The builder is the one who will be paying the commission, in most cases, and he'll be delighted for you not to have representation (remember, whoever the "agent" is who you talked to at the builder's, they don't, at least here, have to be licensed, and even if they are licensed, they represent the builder's interests, not yours - and if they're licensed, they're required by law to represent the builder's interests, not yours).
Have you worked with the agent at all? Has he shown you any houses, given you information about the area and about buying real estate, anything like that? Has he done anything wrong except not be with you in your car all the time just in case you happen to drive by a development and decide to stop in?
Bottom line, all ethics and the contract you may have signed with the agent aside: do you want to be in a situation where the builder has representation and you don't?
I did sign a brokers contract but it expires at the end of this month.
ssgmun5000: Hey friend....listen up. Ignore all the "guilt advice" from the brokers on here. If YOU found the house on your own what you need more than anything else is a good real estate attorney to help guide you through the process. Just take any papers and contracts from your builder and let your attorney read them and explain them to you BEFORE you sign them and return them to the builder!
Brokers will tell you that you "really need them" to help guide you through the process after you have found your home. BULL!!!!! Your attorney can and should help you and answer any questions you may have regarding financing and the like. Brokers are best suited during negotiations ...not after and trust me...if you ever need legal advice a broker will just refer you to an attorney anyway.
And the fees your attorney will charge you will be FAR LESS than the commission your broker will try to make you feel they rightfully earned. And if they threaten to sue you....let them. Most of the time it is a bluff anyway. It is YOUR money.
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