HELP!! Realtors & Brokers. Is it normal for a broker to change splits and comission?

Question

My broker has a habit of reducing my comish and my co-workers splits in the middle of deals.
She promises a certain amount of money, but when the deal is done, or very close to closing, she manages to use OUR commish to sweeten the deal for the buyer, OR she just chops my comission in half.
Is this normal, or should I start shopping around for a new broker?
Thanx for all your help.
Geoff

Answer 1

It happens. If it happens because of things under your control, that's understandable. You failed to perform. On the other hand, if you did everything you should have, it's time to find a new broker.

Answer 2

I'm gonna say this once RUUUUUNNNNN as fast as you can to a new office that is not there to screw you out of your money. The broker is over you yes BUT you probably procured the customer and did all the work on the deal so if the broker wants to sweeten the pot then it should come out of their share or at least an agreed upon in advance split between you. Go to a new office and get the best deal you can. Here in Florida I am with a company that gives me everything incl. Fax, Long Dist, Secretary everything for $349 a month and I get 100% of my commission. Hey Brokers out there. TIMES THEY ARE A CHANGING>>>>

Answer 3

In my state agents have contracts with their employing brokers that spell out the commission splits. Changing the commission in the middle of a deal (without your consent) would be a breach of that contract. You should find yourself a new broker.

Answer 4

i wholeheartedly agree with goldshire... in my state, illinois, i have to make a separate contract with each of my salespeople, licensed real estate salespeople, that spells out how much their split will be for each transaction to which they provided the purchaser or which listing they brought into the office. depending on what i pay for that agent to perform his duties, generally, i give a 50% split of whatever commission comes in at closing.

first, it is against your written agreement, i.e., your contract with your broker, for her to have changed her mind on what will be paid to you in your agreed split unless you enter into a different agreement with her.

second, far more importantly, if she is using even one red dime of earnest money that is set aside into escrow towards a purchaser's purchase, it is entirely against the law and she stands to lose her license!!! no co-mingling of earnest money and operating expenses!!!

third, at least in illinois, it is against the law for me, the broker, to give any part of the commission PAID (not due, because how can we determine that the deal will actually close?) to anyone other than a licensed real estate broker or licensed salesperson in my office. we can give whatever we want to any licensed broker, anywhere. i.e., if a broker in new york refers me a seller in illinois and wants 20% of the commission my office receives upon closing the deal, of course i can issue that amount to him.

fourth, remember that usually, if you take your license down and go elsewhere, she is entitled to retain all of your forthcoming commissions as well as all of your listings, and perhaps, your clients. most brokers will not do that when you have performed all of your duties honestly and professionally.

if you split 50/50, then it's only reasonable that should she reduce the price by reducing what her office takes as a commission, that such reduction would be split 50/50 by the both of you. i.e., if what the office would be due would be $10k, and then she wants to put out $2k towards "sweatening the deal," i.e., to make the purchase more attractive, then wouldn't it be reasonable for her to give you $4,000 and the office $4,000? (but the $2,000 put towards sweatening the deal CANNOT be paid to the purchaser!) such "sweatening deals" should be spelled out in your broker-salesperson CONTRACT.

if your broker is changing any of the terms of your split agreement in midstream and as a result you suffer monetary loss, you can sue for breach of contract, and you will most likely win.

if your broker wants you to pay any expenses not covered in your agreement, then set up a different agreement to cover the expenses that you agree to pay. THAT amount can be deducted from your split or you can agree to pay such expenses upfront.

i do not understand what you mean when you say that she changes your split before the closing. how can she get paid anything if the deal doesn't get closed? so how would you be paid?

it really sounds to me that you have a shyster of a broker. if anyone did that to me, i'd be gone as fast as you could say "boo!"

Answer 5

New.
Broker.
Now.

Answer 6

new broker, now.