Buying or Selling a Home/Compensation of an agent...
Dear Dick Dennis!
Thank you very much for volunteering on this site!
I have a few 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?
Also, would you please send me your newsletter in PDF format? My e-mail address is
Once again, thank you VERY MUCH in advance.
First thing you have to understand, Pablo, and that is IN REAL ESTATE IF IT IS NOT IN WRITING IT WAS NEVER SAID.
Therefore, no commission would be expected based on what you have indicated, Pablo. Why you would be willing to let someone "rent" your property before buying it is beyond my comprehension. If he really wants to buy it, then the "buyer" should put $5,000 as a non-refundable deposit for those three months and pay $64 per day ($1,900 per month) rent. If indeed the buyer does enter a legitimate purchase agreement, then you would be willing to credit the buyer with $3,000 (a little more than 50% of the rent he will have paid for those three months) toward his purchase price.
You are stepping into a situation you may not want. Because the buyer is in the National Guard you will find it very difficult to evict him and/or call a default should he wind up not buying and you are contending with a tenant who is not living up to his agreement. The government just will not let you evict or call a default.
Now you can understand why you should have a knowledgeable broker working for you in selling your property. He/she would know the proper way to handle this transaction. By the way, I am not able to send you a copy of my newsletter via PDF because you did not give me your email address. I do wish you well.