Q: My girlfriend and I were recently working with a Realtor, and had her write up a bid for a house we are looking to purchase. However, we now see there is a section that says the buyer owes a $295 marketing fee. I’m not sure how this applies to the buyer, mainly because there was no marketing done for the house of any kind on our end. We found the house online, called up a Realtor to let us in.
–Mike, Spring Hill, FL
A: A lot of these big name companies are doing this now. Its a way for them to make extra cash in these tough times. I think its crazy. I dont think its illegal though.
Matt Laricy is a Realtor® with Americorp Real Estate in Chicago, IL.
A: This is normal to be charged a brokerage fee.. It is not paid to the agent but to the brokerage. Both buyers and sellers are charged this type of fee by the brokerage that is representing them in the transaction. This fee is often called a brokerage commission, admin fee, storage fee, marketing fee, etc… and is common.
The fee ranges on average from $250-$350 per transaction in Florida. The fee is only paid when you close on the property and is charged as a part of the closing fees. Now, I have seen some brokerages charge up to $695.
Also, finding the house online or with an agent is the easy part… The real job of the agent is to prepare the contract, negotiate the details of the contract on your behalf, arrange home inspection, protect your interest in the transaction, and most importantly help resolve any problems that may come up from the time the contract is signed till it closes…
We do a lot more than just open doors….. As a online shopper the only thing you can do is just look at pictures.. The only way inside is with an agent.. With all due respect, your agent who you said “just let you in” already has done more than that since you stated she wrote up a bid for the home… and she soon will be or has marketed your offer to the seller on your behalf…
Oh! and by the way buyer’s agents do all that and more and buyers benefit from their services without having to pay the agent commission.
Stephanie Leon is a Realtor® with Avanti Way Realty in Miami, FL.
A: There are a number of brokers that charge a “marketing” fee to the buyer. It should be more appropriately called an “administrative” fee since it is often collected to defray some of the costs of processing all the paperwork necessary to close a transaction. The term “marketing” is what’s throwing you off. Sometimes that can be negotiable and I would suggest you push the issue with your Realtor to see if you can get it at least reduced if not excused completely. Good luck to you!
Bob Kelly is a Realtor® with RE/MAX Main St. Realty in Moorestown, NJ.
A: If it was not disclosed to you in some of the paperwork the agent gave you before you put in the offer, you can refuse to pay it. Just say “RESPA”.
Linda Walters is a Realtor® with Sage Realty LLC in Wayne, PA.
A: You can cross that out of the contract, initial and date if you do not want to pay that. Its not something normally charged, at least in IL. Consult a managing broker with another company within your area and ask if this is standard practice. It may be something your Realtor’s office enforces, but no one is going to give up a sale if you opt out of that fee.
Barbara Barker is a Realtor® with Sohail Salahuddin Smart Property in Chicago, IL.
A: Realtors can charge fees on top of commission for performing specific services. Usually upfront fee arrangements are associated with short sale transactions. With standard sales, not so much. Keep in mind that the laws on this vary from state to state and I’m not sure what Florida’s position is.
There are many brokers that are experts in the field of short sales that have successfully closed hundreds of transactions that advocate charging an upfront fee is fair because of the many hours they put into the transaction. If the seller decides to walk away, the brokers do not receive any compensation for all the effort put into the deal. Ergo, the upfront fees.
One of the stipulations for charging for a service is that the service described must actually be preformed. A generic “Service Fee” $150 would not be allowed without details describing what it covered.
Also, if you have not signed an agreement of any kind it is likely that you will not be obligated to this Realtor. If you have a problem with fees, find another Realtor and brokerage that doesn’t charge them.
Lee Dworshak is a Realtor® with Keller Williams LA Harbor Realty in Rancho Palos Verdes, CA
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