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Real Estate Fight Club

16
Nov 2020

Episode 60: Should You Use Your Commission to Settle a Buyer-Seller Dispute?

November 16, 2020

On this episode of the Toe-2-Toe Podcast, hosts Jenn Murtland and Monica Weakley throw down over whether you should use your commission to settle buyer and seller disputes. Politely, they agree to disagree on this one!

Episode Highlights: 

  • Jenn believes that because the agent is not a part of the contract, they should not be part of the negotiation.
  • Monica thinks there are definitely times where it absolutely makes sense to throw in from a financial standpoint.
  • Besides making a mistake, Jenn thinks agents are too quick to dip into their commission to get the deal done.
  • As agents, your time is valuable, so don’t partake in anything that does not pay you for your time.
  • Monica dealt with a client that was willing to walk for $600 over principle, so she decided to pay out of her commission.
  • Jenn thinks that agents should walk away because she expects the other side to cave in.
  • Monica looks at the consequences way down the road and lets those weigh into her decision to use her commission.
  • Don’t just immediately give up your commission, but if it makes sense financially, don’t be blind to the benefits.
  • If you decide to walk away, you have to spend more time finding a new deal, and also, having your sign up for that long looks bad.
  • Even though you are willing to give up your commission, it’s not ethical to ask the other agent to give up their money.
  • Jenn believes that if the parties involved in the contract can’t figure it out, then they are too caught up in their emotions.
  • If you are able to get your clients all the way to the end, make sure they cross the finish line.
  • Monica and Jenn actually agree that too many agents give in far too early.
  • Buyer’s agents tend to give in more frequently, and they can’t be sure that they are going to get the deal.
  • Monica hates that agents consider themselves busy with tasks other than buying and selling houses.
  • Take your desired income divided by your hours to determine the worth of your hourly pay rate.
  • This week’s tiebreaker, Anne Uchtman, is an agent and the Director of Agent Development and Training with StarOne, so she knows the rules.
  • If a deal with the other agent has been reached, then Anne believes it’s worth it to dip into commission.
  • Agents aren’t just showing beautiful houses all day; there are plenty of challenges and hindering factors.
  • It’s in the code of ethics that agents need to cooperate with each other in the best interest of their clients.
  • Every brokerage has different rules in regards to their agents cutting a check to settle a dispute.
  • While this is a viable tactic, it is not to be regarded as the first line of defense.

3 Key Points:

  1. Agents need to understand the value of their time so that if they are doing any task that does not sufficiently pay for their time, they know they need to back out.
  2. The difference between buyer’s agents and seller’s agents is that buyer’s agents don’t even know if they’re going to get the deal, thus making them more likely to give up their commission with the long process.
  3. Though they agree that agents give in too early, Jenn and Monica differ in their opinions on whether or not you should dip into your commission at all. Monica says yes while Jenn says no.

Resources Mentioned: