Going around a broker

[jewt]

In my attempt to buy my current boat in the Bradenton, Fl. area the list broker was a real AH and would not provide info I requested unless I made and offer through him. After many calls and e-mail to get more information with zero results I made an offer through a broker in my home state that I had actually worked for in the late '80's. Of course the listing broker was POed but I felt it was has own fault. I was not even allowed to meet the with the seller.

I have no regrets that he had to split the commission!

jewt

[nwdiver]

Commissions where I am run 7-10%, your that close and can't close its your problem.........

[barnakiel]

If the broker finds and brings the buyer, this would be morally odd to go round the broker.


Cheers,

b.

[valhalla360]

Originally Posted by TJ D

Guys, let's lay off Stainless Guy. He recognized that he wasn't approaching this the right way and acknowledged it. Classy move in my mind.

Did he or did he just get called out on it, so he backed down publicly?

"I am considering approaching the owner about dealing without a broker as we could both benefit from this. I have done this with real estate with good success in the past so don't see why it would not work here."

[richr]

You can make the offer direct to the seller. His contract with the broker is up to him...and, as has been pointed out, do you really want to deal with him if he is shady?

The only reason I personally would actually do this (and I tried it unsuccessfully when trying to buy a house) is if the broker is demonstrably failing to do their job. Doesn't return calls, drops appointments, provides inaccurate information etc. They are not doing their job of making and closing a sale. Then the seller "may" consider it legitimate to go around the broker's back. Now I am no lawyer but I would expect the seller to give the broker due notice of what a buyer has told him is unreasonable behaviour, and the opportunity to rectify it. If push comes to shove, I wouldn't then expect a broker to sue a seller when the seller has demonstrable evidence of the broker doing a poor or useless job. Why raise the publicity of poor customer feedback?

"Being pushy" wouldn't cut it. Missing appointments might.

[john61ct]

The point is OP has been shamed enough.

Also that the buyer can try to deal with seller directly, for whatever reason, but that does not take the commission out of the pricing negotiation.

Or rather, whether it does or not, has nothing to do with the buyer, is a matter between the seller and broker. If I learned the broker was not doing their job, I would try to legally terminate the contract.

Personally as long as I was under contract with a broker, I would disqualify a buyer trying this.

[richr]

That was my point. As seller, if the broker is doing a bad job, terminate them. I'd want, from a legal and moral perspective, clear reasons to say they were doing a bad job, particularly in order to deal with a buyer they had introduced.

As a seller, I would tell the buyer to go through the proper channel.

The reason (as seller) that I almost terminated an estate agent contract one time was that I had reason to believe they had stopped showing my property. They had a buyer at the lower end of what I would accept; they were leaning on me to take that price while showing other comparable properties to other people when I thought they should be bringing in competing offers to me. In the end their buyer raised his bid and we closed. Broker was doing a poor job.

[johnnyH]

as a licensed real estate broker for almost 40-years there is nothing wrong with having the broker reduce their commission to make the deal work. god knows i have done that dozens of times to salvage a deal whether i am wearing the hat of a broker, buyer, or seller. if you broker isnt helpful then find another or work without one. its not difficult to locate a boat on yacht world and hire a surveyor

[Shrew]

Much of this makes no sense. The commission is paid to the broker by the seller. If the commission were negotiated down, it would benefit the seller. Negotiating down the broker's commission and having it benefit the BUYER is a delusional pipe dream.

It was my understanding that real estate contracts work much the same way. I'm not clear how bypassing the broker/agent is ethical in any industry.

Engaging with a sellers broker, then introducing a buyers broker after the fact is also crazy. You're now asking the listing broker to split commission for a sale he previously had on his own. I'm sure that would get people annoyed.

[john61ct]

The point of the commission reduction is to get the sale done by reducing what the buyer pays, without reducing (as much) what the seller gets. That benefits all parties.

[valhalla360]

Originally Posted by richr

That was my point. As seller, if the broker is doing a bad job, terminate them. I'd want, from a legal and moral perspective, clear reasons to say they were doing a bad job, particularly in order to deal with a buyer they had introduced.

As a seller, I would tell the buyer to go through the proper channel.

The reason (as seller) that I almost terminated an estate agent contract one time was that I had reason to believe they had stopped showing my property. They had a buyer at the lower end of what I would accept; they were leaning on me to take that price while showing other comparable properties to other people when I thought they should be bringing in competing offers to me. In the end their buyer raised his bid and we closed. Broker was doing a poor job.

If the seller feels the broker is doing a poor job, it's certainly their right to end the contract per the terms of the contract. This is perfectly legal and ethical but...
- If the buyer was found while the contract was still in force, the commission is typically still due. Most contracts have provisions for how to cancel the brokerage but almost always includes some clause to this effect to avoid just this type of scenario where the broker brings in a buyer and then gets fired to avoid paying the commission.
- The buyer has no say in having the seller drop the broker...unless he's encouraging the seller to pull a scam in which case we are back to the legal/ethical issue.

[valhalla360]

Originally Posted by john61ct

The point of the commission reduction is to get the sale done by reducing what the buyer pays, without reducing (as much) what the seller gets. That benefits all parties.

No it doesn't. One of the parties is losing a lot...the broker is losing in this scenario.

[Paul L]

Originally Posted by valhalla360

No it doesn't. One of the parties is losing a lot...the broker is losing in this scenario.

I guess you can look at it like this. Maybe its a glass half empty thing. The broker starts with zero from the potential sale. If the sale does not occur he stays at zero. If the sale closes he gets a commision. Brokers only succeed when they close deals.

[valhalla360]

Originally Posted by Paul L

I guess you can look at it like this. Maybe its a glass half empty thing. The broker starts with zero from the potential sale. If the sale does not occur he stays at zero. If the sale closes he gets a commision. Brokers only succeed when they close deals.

But if he lets it sit on the books for an extra month or two for very little cost/effort, he can double his money waiting for a normal deal.

Also, if you set the pattern that you will cut your commission, it will become common.

[Paul L]

Originally Posted by valhalla360

But if he lets it sit on the books for an extra month or two for very little cost/effort, he can double his money waiting for a normal deal.

Also, if you set the pattern that you will cut your commission, it will become common.

Or the listing will expire. A deal today is far better than a hope in 6 months

FYI cutting commission is already common, that horse left the barn a long time ago.