Sometimes I despair over the direction our business is taking at the behest of our government (i.e. Competition Bureau).
Posted listings are a case in point.
Don’t get me started on just how bad a thing they are for everyone.
OK. Latest fiasco.
This Seller thought he would save a buck by posting his listing onto MLS through a brokerage and not have to pay any listing fee. That should have been our first clue!
The incompetence of this sorry ‘listing’ brokerage was also staggering. Should have been clue number two! The listing didn’t even indicate the correct form for any co-op brokerage to present to the Seller for payment of commission. Never mind listing’s deficiency of basic listing information. Way to help the selling process along, guys!
OK. We showed this non-listing listing and the next problem was that our clients liked it. Agent asked me how we get paid our commission. Directed him to present Form 202 to Seller for signature. He did.
Seller told our agent that there was another offer under consideration and we were in competition. Nice. Competition on a bloody posted listing!
Additionally, this vacuous Seller would not sign Form 202 (Agreement To Pay Commission) unless and until after the Seller had been presented with the offer. Give me a break.
What to do? We’re in competition; Buyer really wants the joint but Seller will not sign any commission agreement until having the offer firmly in hand.
Incidentally, we had a signed BRA with our Buyer agreeing to pay us our full commission. However, the offer that the client had signed already included the commission that the Buyer would be obligated to pay us through the BRA were his offer to be accepted. If we sent the offer to the Seller before the Seller signed Form 202, the Seller could accept our offer and circumvent the requirement to pay us any commission. The Buyer would then be responsible for paying our commission in addition to paying an amount for the house that the Buyer had anticipated already included all commissions. We couldn’t allow that to happen to our Buyer client.
The Buyer wanted the house. Our agent wanted the deal.
Had the Buyer not been so keen I might have suggested walking away from this Catch-22 situation.
What to do? (This is why I get paid the really big, big bucks!)
I suggested arriving at the Seller’s doorstep and letting them see the offer but not putting them in a position to sign the offer until they had first signed Form 202. Foiled again because Seller refused, demanding that offers be emailed and would not agree to any personal offer presentation.
OK, time for Plan B.
I wrote a simple ‘Agreement To Pay Commission’ clause and had the agent put this clause right into the offer and have the Buyer sign this revised offer. It is my derivation of a clause I learned about in Adorna Carroll’s Accredited Buyer Representation course (excellent, by the way).
Here it is:
Upon completion of this agreement the Seller agrees to pay 2-½% of the purchase price of the real property, plus applicable HST, to the Buyer from the proceeds of the sale in order to settle the Buyer’s contractual agreement with his Buyer Agent, Sage Real Estate Ltd.
So, clause went into the offer and the offer was emailed directly to the Seller. If the Seller wanted to accept the offer he also had to accept my payment of commission clause. He couldn’t accept the deal without having to agree to pay us our well-earned commission.
They signed. Deal was done. We’re holding deposit.
Please feel free to utilize this clause if you run into a similar situation.
P.S. when the Seller told our agent there was another offer, it subsequently came to light that the ‘other offer’ was verbal. Rats. Duped by somebody not legally bound to follow Realtors’ Code Of Ethics.
Stupid Posted Listings.