Skip to main content

Will I owe my buyer's agent a commission if I decide to build?

tl;dr: the question in the title

Hi all - I've been a buyer in North GA since late February. Like many of you, I elected to put my search on hold due to COVID and am now suffering through an extreme seller's market.

Lately I've been running the numbers on building, and it looks like the better option to me. One thing I'm trying to clarify, though, is what kind of commission my broker would be entitled to in a lot purchase+building transaction and who would be on the hook to pay it.

I signed an exclusive buyer brokerage agreement in late Feb that runs for a year. From what I can tell, I'm not able to unilaterally terminate it in GA (could be wrong on this, info is sparse), so my options as I see them are:

  1. Have a transparent conversation with my broker in which I tell her that I've decided to build and ask if she'd still like to represent me in the lot purchase
  2. Have a generic "it's not working out" or "my plans have changed" conversation and ask her to terminate the buyer brokerage agreement as a professional courtesy. Then start from scratch in finding representation for the lot purchase, making sure that whatever I sign pertains to the land only

All else equal, I'd prefer to do (1). The broker has done work on my behalf, and I'd like to at least give her the option of collecting a commission on the lot, even if it's much smaller than she'd envisioned originally. That said, I'm also wary of fine-print somewhere in the BBA/law that would entitle her to commission on the actual home that I build, coming out of my pocket. If that were the case, she'd have huge leverage over me the moment she knows my plans.

So basically what it comes down to is, I don't know the law and I'm afraid to have conversation #1 until I do. I've read the agreement and don't see anything suggesting that either I or the builder would owe her commission, but I also don't see anything that gives me 100% confidence that we wouldn't.

So for the brokers and real estate lawyers and anyone else who knows, how do these kinds of situations work? Does a standard brokerage agreement (again, I'm in Georgia) entitle her to commission beyond the lot purchase? And if so, who pays it?

submitted by /u/-bob-sacamano
[link] [comments]

source https://www.reddit.com/r/RealEstate/comments/hzpigq/will_i_owe_my_buyers_agent_a_commission_if_i/
Labels:

Comments

Post a Comment

Popular posts from this blog

Aren't comps/CMAs useless with buyer credits at close happening now?

I'm looking into buying a new construction townhouse in my HCOL US city. I'm seeing builders offering interest rate buydowns worth $20k-$60k on $800k homes (rather than just lowering prices) in order to keep their comps high for their other units, now that buyer demand has been declining. I asked my agent about these, and he said these buydowns aren't even the full story: buyers can write all kinds of other credits into an offer, like their closing costs, prepaid sewer fees, etc. Apparently cash buyers can just write in a "buyer credit at close" for any amount in their offer. So a new townhouse that appeared to sell for $800k in the MLS might have actually been a cash offer with a $100k+ buyer credit at close, meaning the buyer only spent $700k or less in total, but to the rest of the world they can only see the $800k! So that made me realize I can't trust comps/CMAs for other new construction townhouses. The sales prices could be way lower than they appear...
1 comment
Read more

Pool fill without engineer oversight

We are in the process of purchasing our first ever home in CA and we just discovered in the disclosures that the new build property we are purchasing previously had a swimming pool which was filled without an engineer onsite to approve the work (details from disclosure below). Is this something we should be concerned with or not? Is it something we should have additional inspections conducted on? We are originally from the UK and not really sure what to do with this information and if it is concerning or not. A POOL DID EXIST PREVIOUSLY. COPING, TILE, GUNNITE AND REBAR WERE ALL REMOVED AND DIRT AND CLEAN DRAIN ROCK WERE USED TO FILL IT IN. COMPACTED FILL WAS NOT USED AND NO ENGINEER APPROVED THE DIRT AND DRAIN ROCK FILL IN submitted by /u/tommot82 [link] [comments] source https://www.reddit.com/r/RealEstate/comments/dpyzw8/pool_fill_without_engineer_oversight/
Post a Comment
Read more

Making offers on houses not listed for sale.

I want to buy a home for retirement. I am looking at lots of options, mostly focusing on the locations that appeal to me. I see lots of Zillow estimates of homes that look like great deals to me. Are these estimates accurate, even though similar houses in the same area that are for sale are usually priced much higher? If so, is it realistic for me to try to make offers to owners that do not have their homes listed? Would a realtor even consider helping me do this? Or, do these values indicate that the houses listed for sale are overpriced, and I should just lowball until someone accepts? Are houses today tending to sell far below list prices, or ??? submitted by /u/chewybrian [link] [comments] source https://www.reddit.com/r/RealEstate/comments/1o4mcon/making_offers_on_houses_not_listed_for_sale/
Post a Comment
Read more