Buying or Selling a Home/commissions on a trade

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Expert: - 2/22/2008


Question
We were interested in the purchase of a home in Steamboat that is listed in MLS.  The owner of the property asked if we would be interested in trading our home for theirs.  We are open to a transaction of trade.  Since their house is listed in MLS a typical commission will be due.  Our agent is now wanting a commission/finders fee on our house in TN that is not listed but would traded for the listed house in Steamboat.  It is my opinion a full commission is in order for the house Colorado listed but not for our house in TN.  Could you advise on the fair thing to do.
Thanks,

Bob

Answer
Hi Bob,

I think I'm a little bit confused, but hopefully I have it right.  Let me explain and hopefully I answer your questions somewhere in here.

The seller of the Steamboat home has a listing agreement that binds them to pay their list agent as well as the buyers agent a commission.  You probably have a Buyers agent contract with your agent in CO that reads that when you find a property that he/she is due to collect the typical 3% commission and if the seller doesn't pay that amount that you as the buyer are obligated to pay.

The part where I get a little lost is when you say your CO agent wants a finders fee for your home in TN.  Since it's not listed for sale with an agent or you have a listing agreement signed with anybody, you shouldn't be legally obligated to pay anything for the transfer of your TN property.

Knowing Steamboat real estate a little bit, I'm guessing there are some big dollar amounts involved and it sounds like your CO agent is trying to get a little more than he/she deserves.

Bottom line is that you need legal proof that you are obligated to pay anybody anything on the transfer of your TN home.

Hopefully that gets it for you!

Jay  

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Jay Denit

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I'm a Real Estate Broker/Loan Consultant in the state of Colorado. We have a separate foreclosure investing company, so I'm more than willing to answer any Colorado foreclosure questions for both the home owner and investor. I have sold bank owned homes all across the country for all of the big banks. I'd be happy to answer any questions about buying or selling residential homes and specialize in luxury estates. Furthermore, I have some experience in land acquisition and development and know a touch about water rights. We are a licensed lender in most states, so I can answer general questions about all types of mortgages.

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My experience is really anything that has to do with real estate. From buying and selling to investing and foreclosure, I’ve done it all. Being able to handle the acquisition and financing under one roof gives me the intimate knowledge of all facets of property conveyance. My foreclosure/bank owned property (REO) experience gives me the problem solving mindset to always find a solution.

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BARA- Boulder Association of Realtors NAR- National Association of Realtors CAR- Colorado Association of Realtors

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Xavier University-- BSBA Finance Colorado State University-- Professional Certificate in Project Management

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