Is a real estate agent entitled to a fee even though the house did not close?

Question

I was buying a house when I got transferred. The builder agreed to keep my deposit of $21,000. In addition, I got a bill from my real estate agent for $12,000. She says, even though the house did not close, she was my representative and is entitiled to the fee for services rendered. There were no services rendered. Also, she is related to the builder's agent and never disclosed that to me. The contract states that the seller will pay real estate fees at closing.

Answer 1

No closing no fee. Done.

Answer 2

If the contract states that the agent gets the fees at closing then that is what she gets. The house never closed so you don't owe her a dime. That is how real estate works.

Make a copy of her bill, and the contract, highlight the portion that says when she is to be paid, and send them to her. Write a kind letter stating that you appreciate her time and services, but due to her dishonesty about the contract and the builder you will no longer require her services. Let her know that, should she continue to pursue this you will contact your attorney. Find another agent. Preferably one who is a "Realtor" (type of certificiation). Check www.realtor.com for a Realtor in your area.

Good luck!

Answer 3

Spencer Barron is dead on.

If you "breached" the purchase contract, you may very well "owe" the agent a commission.
But as a Realtor, I have never heard of any agent attempting to exercise that clause in anything but the rarest of circumstances. The fact that the builder got to keep a $21,000 deposit leads me to believe that you had no valid, legal reason for not completing the purchase, otherwise you'd have fought for that money.

If the agent did not disclose a relationship with the seller, there may be a licensing/ethical issue that you can use as leverage to make the agent fee go away.

My advice is to contact the broker-in-charge/office manager (they are called different things in different states.

Answer 4

The common misunderstanding is if it didn't close, the broker didn't perfrom any services. If you defaulted on the contract and didn't use one of your 'outs', you may be required to pay. It most likely wouldn't be in your purchase contract, but if you signed a buyer's agency contract so you were working with a paticular agent, it would likely be in there.

Here is how it reads in Colorado's Exclusive Right to buy contract.

"(4) The Success Fee is earned upon the Purchase of the Property and is payable upon closing of the transaction. If any transaction fails to close as a result of the seller’s default, with no fault on the part of Buyer, the Success Fee shall be waived. If any transaction fails to close as a result of Buyer’s default, in whole or in part, the Success Fee shall not be waived; such fee shall be payable upon Buyer's default, but in any event not later than the date that the closing of the transaction was to have occurred. This fee shall apply to Property contracted for during the Term of this contract or any extensions and shall also apply to Property contracted for within calendar days after this contract expires or is terminated (Holdover Period) if the Property is one on which Broker negotiated and if Broker submitted its address or other description in writing to Buyer during the Term. Provided, however, if a commission is earned by another real estate brokerage firm acting pursuant to an exclusive agreement with Buyer entered into during the Holdover Period, Buyer shall owe no commission to Broker under this subsection."

You might want to make a call for a free consultation with a real estate lawyer if that was the case. If you just signed the purchase contract and there's no clause in it explaining something like the above, your probably all right.

You might have a case if for the non-disclosure of any personal relationship with the builder's agent (husband-wife or something) but if they work in the same office that won't be enough. Non-disclosure is kind of a big no-no. Call the real estate commission or the state board of Realtors where you are to find out more about that.

Answer 5

Yes, I believe you are, unless your offer to purchase had an exclusion for your being transfered and voiding the sale. From what you have written here the builder could have sued you for "specific performance" which means that you failed to complete the contractual agreement, and could have made you complete the purchase of the house. With your large deposit, it was in the builders benefit not to sue, but the Realtor was left out in the cold. The Realtor earns a living from the completion of the contract which you failed to complete by your own fault, so the Realtor is damaged. I am not a Lawyer but that is how I think it would be viewed. Call your board of Realtors, your state real estate commission, and it may be worth consulting a lawyer. Maybe even Bill Handel. http://www.handelonthelaw.com/default.aspx
It is my own opinion that Realtors charge way more than they are worth.

Answer 6

What a frickin joke! Can these people get anymore entitled? IT'S A PERCENTAGE! 6%, which is a joke in the first place! She should be ashamed. I'm not gonna use one when I sell. Don't pay.

And what a surprise that snvffy is a realtor- "of course" he says- $12,000 to drive someone around? That's a hell of an expensive cab ride. The whole industry is a joke. She's tryin to see if she can pull one over on you. Also, she should have disclosed this to you clearly at the time of the contract. If she tries to enforce it, take her to court, cause some trouble for her, and warn all your friends. I'm self employed, and I HATE bad recommendations!

Answer 7

OF COURSE your real estate agent rendered services. She drove you around and found the house you wanted. THAT'S RENDERING SERVICE. And if you signed contract, then you agreed to pay her regardless of whether the house closed. READ THE CONTRACT. YEP.

Now, in reality, what I would do is contact the broker she works for and negotiate a settlement. I mean you left the builder $21K, HOW COULD YOU POSSIBLY THINK YOU SHOULDN'T PAY THE REALTOR???

Good Luck

Answer 8

I wouldn't pay her a dime. And there must be a Real Estate Commission or something similar that you can ask for advise on whether she had a conflict of interest seeing that she is related to the builders agent. You may be able to sue her or the builder for your lost deposit. If they wont help go and see a lawyer that specializes in real estate law.

Answer 9

NO Fee due plain and simple . the contract should clearly state realtor gets paid at closing. IF she tries to pressure for payment contact the state real estate liscense board alot of time as in this case there is a violation of real estate law.so you can have her liscensed removed

Answer 10

maximum sellers agreements with the realtor state that they have got an unique itemizing for a collection era of time. It varies with how lengthy reckoning on the area. So, even in you detect your human being customer, you nevertheless owe their value. once that settlement expires, you do not owe them something, till a customer they provided (both by way of their shoppers or through MLS) purchase the resources. each person who has considered your resources earlier to the settlement expiring is less than the brokers administration. yet I have one question for you. have you ever bought a house FSBO?? in case you've not, i ought to strongly advise adverse to it. Realtors can charge for his or her facilities, yet they're worth them to boot. How else ought to you comprehend what the going market price is on your resources? How else ought to you get an MLS itemizing? Do you've your human being replica of a legally binding settlement to purchase the abode and comprehend the records of what's honest for the client to ask and what the organization frequently pays for and what's the shoppers accountability? did you comprehend each of the steps of remaining? that's not worry-free, and once you're searching to keep money, you likely received't. I have considered a lot of human beings promote a house FSBO, and lose out because they finally end up paying an lawyer or a identify organization for facilities the realtor resources because they do no longer comprehend the thanks to do it, or don't have proper licensing to make it criminal. My greatest suggestion, keep the Realtor, or substitute to one you want extra valuable at the same time as your present day settlement expires.

Answer 11

No way is the real estate entitled to any money. if she represents a company (eg:remax) you can call head office and ask them, but I would not give her a penny. look in to buyers remorse laws some times if you had changed you mind in 3 days you can maybe get your deposit back..