Buying or Selling a Home/Agent compensation
Dear Jay Denit,
Thank you very much for volunteering on this site!
We don't live in CO and we don't have an expensive house to sell but when we will, I promise to seek you out! :) In the meantime, I'd really appreciate if you would be nice enough to help me out with a few (for you and with your background) easy questions:
Background: We are selling a house in Louisiana as a FSBO. (We are doing FSBO mostly due to major financial challenges we are about to face).
We have paid an agent $400 to give our home an MLS number for 6 months. As part of the listing, we have agreed to compensate a buyer’s agent some amount. And sure enough, whenever we are contacted by an agent, one of the first things they wish to reconfirm, is if we are indeed willing to pay them a (usually specified amount of) commission.
We just recently received an offer from an agent. (She has the same last name as the buyer and we learned, she is the ex-wife of the buyer).
In conversations with the agent there has not been any mention of compensation for her, nor is there anything in the contract. We are a bit puzzled about this. If it is not in the contract, would she have any legal basis for asking us for anything later?
The offer stipulated – among other things – the following: the buyer wants to rent my house from June 1 till September 1 and then buying it. Buyer doesn’t have a house to sell but we learned he is the Air National Guard and will deploy sometimes in September. (We wonder if maybe the increased pay then is factored in and is the reason, or if he doesn’t want to break his apt lease).
Should I be concerned about the terms of this contract?
How could I make sure the buyer will be able to buy after two months of already living in my house?
What should I put in the contract to protect my interest?
I am thinking about proposing a rental agreement for $40/day – starting on 1 June - until the closing.
But while hoping for the best, would like to prepare for the worst and would like to also propose them an agreement that would state that if by 1 September the buyer cannot buy the home then the agreement will convert to a conventional rental of $1900/month w/ a $5000 security deposit?
Also, should I be concerned that the buyer's agent – as of yet - has not asked for any compensation from me? Could this come up later if it is not in the contract?
Once again, thank you VERY MUCH for your advice!
Hope you had a nice holiday weekend. Without getting too much in depth since I don't know your states real estate contract, contacting a local real estate attorney is always good sound advice. $500 in attorneys fees now could save your skin later. It seems like you have a lot of very detailed questions and someone local can help you much better than I can.
In my experience, if you have advertised in the MLS that you will compensate any outside agent than you are bound to do so by the terms of the listing and the contract you signed with whomever put the house in the MLS. That said, in CO our contracts specifically outline the percentage of sales price to be paid to the Brokerage.
With regards to "lease option", I would direct that again to an attorney or enlist a real estate professional. You need to have some very specific legal language to protect you in case your "renter" defaults.
Best of Luck!