Negotiating Power-Use listing agent?

[thepower]

Im on the hunt for my next rental property & am thinking that If I use the same agent thats listing the property, Id be able to negotiate a better deal than say someone who is using their own agent.. Because the commission does not have split between two agents, my thinking is if the listing agent doesnt have to split, it improves my chances of getting a discount.. Would I be correct? Opinions?

Thanks all

[Debbie]

To the best of my knowledge, it doesn't work that way.

In most cases, the buyer's agent almost always have to deal with and split commission with the seller's agent.

The only way I know of the buyer's agent to get the full commission is if the agent is also the seller's agent.

Reduced commission? Rarely happens.

Debbie

[thepower]

Thats the point, if the selling agent would not have to split commission if I used them also thus better negotiating position.. especially if they do not have to split 6 percent of a lower price with another agent-follow me?

[Debbie]

Yes, I follow you.

It depends if the seller's agent's company allows it.

For example, RE/MAX does not allow the agent to reduce the expected 7% commission because RE/MAX expects it's percentage before the agent get his/her percentage. However, for higher end properties, RE/MAX is willing to reduce 1 or 2 % of the original 7% commission.

You could investigate, in advance, which RE companies allow reduced commissions and which does not allow. This way, you'll know immediately by looking at what company the agent works for. Even if the agent is "independent" of the company.

Further, we have a great independent agent (RE/MAX) who is not allowed to be paid finder's fee. For example, we informed our agent that we'll be doing FSBO. We'd be willing to pay him the finder's fee or 3.5% commission if he brings the buyer to us. RE/MAX forbids that type of deal. It has to be listed in order for agent to get 7% commission in whole or split with another involved agent. Nevertheless, he sends us potential tenant or potential buyer, free of charge.

[mike_mn]

Re/Max doesn't forbid it. Your local remax franchisee forbids it, or the agent is feeding a line of BS(most likely)... Individual Brokers/franchisees can create whatever rules they want to. Your remax agent should be capable of doing a one time showing contract with you. this would stipulate a commission paid on that single buyer. If they won't do it that way, then, find a new friend.

I could find a remax agents anywhere that would bring a buyer to a fsbo for a 3% commission.

Also, the issue with getting a better deal with using the sellers agent is a real possiblilty if you stay in control of th negotiations. just remember, whether or not they lower the commission is not of your concern. The price you want to get it the key. Also, I would highly suggest you require the agent to let you be there during the presentation of the offer, otherwise meeting with the seller yourself. if you are not licensed you are doing nothing wrong. make sure the seller knows they should be asking to have the commission reduced.

Debbie, I would find a new agent. Most remax agents get 100% of the commission anyways...no splits generally, just a flat transaction fee sometimes charged to the seller and/or buyer. I think you are getting fed a line by a "great" remax agent.

[Debbie]

Hmmm..... :SM032:

Based on my experiences with other RE/MAX agents saying similar to what our favorite has said, I am now curious if they all are using same lines. *SIGHS*

Before I keep or change agent for future RE investments, I will speak to the RE companies' offices. Not just RE/MAX but other companies as well. I want to find out what the rules are.

Mike, your response could've easily caused me to react negatively. But I've gotten to know you via MB for almost a year. I suspect that you knew that. Nevertheless, thank you for giving me the opportunity to consider the possibility about our agent. If I have been made a fool of, I will rectify it by investigate and being better informed.

Thank you, Mike.

Debbie

[BSH]

It has been my experience, and agents have told me this personally, that you can better position yourself without a separate buyer agent. If a listing agent is faced with either splitting a 6% commission if he/she has to work with your buyer agent, vs. the listing agent's agency getting to keep the full 6% . . . well you can guess they'd rather keep the money within the agency. That listing agent's actual cut of the commission is effected by whether or not there is a separate agency involved in the transaction. In one deal, when I'd contacted the listing agent directly, he outright told me that, although the other offer on the table was a little higher than ours, the other offer had a buyer agent involved. If our offer was accepted, he would actually pocket more money. That was our cue to sweeten the deal. Instead of increasing our actual offer, we promised to close in less than 30 days and take the house as is. Done. It was ours. Yeah, yeah, I'm sure he broke all sorts of codes of ethics and such. But I adored that guy--he was a straight-shooter and always sent me great stuff and no BS. Unfortunately, he passed away. In fact, my two favorite agents both died in the past year. Hmmm . . . maybe it's me? Now I'm worried!!!!!!

[thepower]

It has been my experience, and agents have told me this personally, that you can better position yourself without a separate buyer agent. If a listing agent is faced with either splitting a 6% commission if he/she has to work with your buyer agent, vs. the listing agent's agency getting to keep the full 6% . . . well you can guess they'd rather keep the money within the agency. That listing agent's actual cut of the commission is effected by whether or not there is a separate agency involved in the transaction. In one deal, when I'd contacted the listing agent directly, he outright told me that, although the other offer on the table was a little higher than ours, the other offer had a buyer agent involved. If our offer was accepted, he would actually pocket more money. That was our cue to sweeten the deal. Instead of increasing our actual offer, we promised to close in less than 30 days and take the house as is. Done. It was ours. Yeah, yeah, I'm sure he broke all sorts of codes of ethics and such. But I adored that guy--he was a straight-shooter and always sent me great stuff and no BS. Unfortunately, he passed away. In fact, my two favorite agents both died in the past year. Hmmm . . . maybe it's me? Now I'm worried!!!!!!

This post sums up what I was trying to communicate. The agent can persuade the buyer to take a lesser offer if the know they will get the full commission instead of splitting it with a buyers agent..

[Judd]

Edited

[SPIVALAW]

I have been a broker since 1982
Agents can do anything their broker approves on the %.
many remax are independant and just pay broker a flat fee.

[skulldog]

Exactly SPIVALAW. I've been a RE broker for 18+ years and work for re/max and each agent can negoiate any deal they like(legal of course) and nobody says anything. The Broker/Owners in a re/max franchise work for the agents, because the more you sell, the more they make. I pay a monthly fee for desk, shared office expenses etc, in turn for a much larger commission split.

As far as the Buyer or Buyer agent meeting with the seller, absolutely not! If I'm representing the Seller, it's my job to put my client in the best possible position to get maximum dollar, I don't won't them saying something that would put the Buyer in a position of strength. With that being said when I represent the buyer, I ask, but am always turned down. As far as double dipping a transaction, the only advantage other than financial is that the transaction is controlled which is huge, considering the amount of new agents(real estate and Mortgage) that came into the market recently and are handing pre approvals like candy. I set up deals that if I sell the property directly a slightly reduced commission is given, but that benefits the seller, not the buyer.

GL

[SPIVALAW]

Every time I meet with seller (as me the buyer) the deal works.
No matter who is there.
I only talk win win deals.
Agents who stop me simply costs clients the deal.
When they say no, I go to broker.
Its my money and I can choose to be there when it is offered.
Thats called the golden rule.
Seller can sit quiet and listen.

[skulldog]

We can agree to disagree. Maybe your the exception to the rule

GL

[SPIVALAW]

I fit no mold, we can agree on that.
:>)