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I've found a FSBO home that I may put an offer on. Being that I would like to have my buyer's agent represent me, should her commission be less than the standard 3% given the fact I'm the one that found the home?
If so, what would be a fair commission in this case?
1. No such thing as "standard" when it comes to real estate commissions go.
2. What does your contract say?
3. What do you think finding the house is worth?
First, there is no "standard" commission. It's up to you and the agent to agree to a fee. Consider that most of the work of a buyer agent begins with the purchase negotiation and through to closing. How long has the agent already been working with you? Does the agent deserve any compensation for assisting you up to this point? If 3% is a typical buyer agent fee in your area, then consider that as a starting point.
I don't have a contract with my buyer's agent, so everything is up to negotiation. I want her to be fairly compensated for her work, but at the same time, she did not find the house.
The home will cost in the low $300Ks, so if she were to get her standard 3%, that's over $9K. Would it be unreasonable for her to be compensated $5K to process the paperwork, considering I found the home?
That doesn't seem unreasonable to me, but I have no idea how these situations usually play themselves out...
I don't have a contract with my buyer's agent, so everything is up to negotiation. I want her to be fairly compensated for her work, but at the same time, she did not find the house....
It's rare that I personally find the house for my buyer clients. They usually find it either by browsing through my MLS search or other online method. I show them the homes they like, advise them on issues regarding the house and area they may need to investigate, work to negotiate a good price and close on the house they select. Will your agent just fill out paperwork, or do you expect more?
I am a first time home-buyer so yes, I am going to need her help throughout the entire process, there's no way of getting around that.
The issue here is I am what you would call a picky buyer. I knew before enlisting my buyer's agent's services exactly what I was looking for, down to the specific neighborhood, floor plan, price, etc. I only ask for showings when something comes available that meets these criteria so she has not shown me dozens of homes. But I would be lying if I said it didn't irritate me that she would only "find" and suggest showing homes which offered her a full commission. In other words, I had to initiate everything if a home was a FSBO or offered directly through a builder.
This particular FSBO fits my criteria to a "T" and wasn't hard to find, but as usual, my realtor never mentioned it and I had to initiate the process. Again, I want her to be compensates fairly, but part of her commission should include taking the effort to find available homes, should it not?
It seems her commission dictates which homes she's eager to show me...
The seller (or the seller's agent in a listed property) traditionally pays the commission for the buyer's agent. Is the seller on this FSBO willing to work with buyer's agents, or have they marketed the property as NOT being willing to work with a buyer's agent? (Yes, there are sellers that do that - there's lots of people in the world who will cut off their noses to spite their faces.)
The fact that she has not shown you dozens of homes doesn't mean that she hasn't been working to find you the perfect home. Agents preview homes and can often eliminate them that way without even bringing them to a "picky" buyer's attention, because there's something about them that's on the buyer's "deal-killer" list. The time is spent in the service of the buyer and saves the buyer time in looking at inappropriate properties that might look good on the internet, but the buyer will never know about that time spent. In fact, if you're a picky buyer, it's even more likely that she's been doing this work on your behalf while not telling you about it because why would she? It's part of the job.
As said above, most buyers these days find the house they want to buy while not in the company of their buyer's agent. They find it through the listings that the buyer's agent shows them, through driving down a street and seeing a FSBO sign, online (sometimes simultaneously with their agent, sometimes not), through word of mouth, any number of ways. The real work starts, though, once the house is found, through negotiating, through knowing the comps (sold comps, not listed comps, which information is available to the public in some states but not in nondisclosure states like Texas), through knowing the market, through herding all those cats to closing once there's a contract, to making sure that all appropriate legalities are complied with (especially important with either a first time buyer or a seller who's a FSBO, and REALLY important with both in the same deal), a myriad of things. So, yes, your buyer's agent, even if she didn't find you this specific house, if you want her to do all of that work for you, should be paid the going rate in your area.
My agent did not find the house that I ended up buying but she earned her money in other ways. Basically my house buying transaction was extremely smooth and I was given sage advice throughout the entire process. She even called various parties while she was on vacation to check up on the process, and basically I did not have to worry about a thing. If the holdup was me, she would call and gently remind me to send this thing to that person, or to schedule this inspection or whatever. She was awesome and I think she earned her money.
I found the house because it's on one of the routes I like to take for my early morning runs. From my initial conversation with the FSBO folks, they seem to be willing to work with a buyer's agent, but I don't think they'll pay the full 3% because they mentioned in passing a figure of $5K.
That leads me to another question. If they're willing to work with my agent, should I just separate myself from any negotiations between them and my agent regarding the commission?
I think $5,000 is plenty fair. If he/she doesn't take it, find a different realtor that would like an easy $5,000 comission. Frick, it takes me a month of working 160hrs to make $5,000....
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