If you are a realtor, you need to keep your guard up. In a fast moving market, buyers will and can try any "trick" to seize the advantage - often at the peril of a home seller and their realtor.
A consistent pattern of late for buyers is to go directly to listing realtors. Let's state the obvious - some or perhaps many realtors have agreements with their sellers along the line of this. "Mr. Seller, if I bring my own buyer to the property, I will adjust my commission by x$" These type of agreements are known as collatoral agreements and must be exposed in multi offer situations.
Some buyers seize on this agreement to their advantage. A buyer will approach a listing realtor and "suggest" they would prefer to deal directly with them. Trust me, they are not blown away by your bubbly personality or your fountain of local real estate knowledge. They want the inside track to their way of thinking. And oh, they also want an advantage when competing with other offers - reduced commission being paid for their agreement means a better opportunity of securing the property.
Many realtors would rather take a bit more than their listing side for an agreement, even if the more is very little.
So what is the problem with this activity? To my way of thinking, it doesn't create a level playing field, and it has the potential of getting in the way of existing buyer representative agreements. Many times now I have received calls from listing realtors who have represented both the seller and buyer for a reduced fee, only to find out that their new best friend the buyer was already under contract with another representative. So, the listing realtor essentially interfered with a buyer rep contract by being involved in the transaction. They have done the work for the buyer rep and more than likely will be forwarding their hard earned commission to him or her. As for the buyer, he or she gets her house, at a reduced price and likely will not face any problems moving forward. Not that they shouldn't.
The practise is terrible and any reputable realtor should not engage in it. A buyer has the right to have an opportunity in an open market to secure the home of their dreams. A realtor, who does their work - has the right to be compensated for their work. When we represent both seller and buyer, the lines are blurred.
Many realtors do not represent both the seller and buyer, instead they ask an associate to stand in for them - to keep the process transparent and distant. Reducing a commission for the benefit of anyone is just wrong and has the potential of causing so many problems for the public and realtors.
Do the work contracted for and get paid for it. Keep commission out of the agreement, let the market place play out normally and openly.
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