In real estate, when a buyer wants to purchase a property, they put a contract on it so that no one else can buy the property out from under them, and so that the terms of purchase are clear to both the buyer and the seller. The contract is an essential part of the deal.
If you are the broker/agent, you, too, should have a contract with the buyer/seller that spells out the terms of your commission.
Broker/agents work with two types of listings in general – open and exclusive.
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Open Listing: The seller gives the listing to everyone they choose to in real estate.
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Exclusive Listing: The seller designates a particular individual as the “go to person” in charge of selling their property.
A lot of people are working on open listings and doing deals on a handshake. A handshake is fine, but once the deal is done, the buyer/seller may not remember what he/she agreed to pay you. With a contract, they won’t forget what they promised, and you will get what you expect and deserve.
If you have a very big deal, it might even pay to hire an attorney to represent you in your contract negotiation. Basically, you want to make sure you’re covered. Make sure you have a contract, and make sure the person signing the contract is the direct owner or buyer of the property.
As part of real estate law, if you are the agent or the broker, and have a buyer who is willing and able to purchase the property, you have to make sure that your contract is in writing so that it is enforceable. If it’s not in writing, it may not be enforceable. Again, without a written contract, you have no proof or legal leverage.
Meaning that if you bring a buyer to a deal and get the price agreed to, the seller/buyer is obligated to pay your commission as agreed, even if they change their minds and decide they don’t want to close. You did your job. You brought an actual buyer who agreed to buy, and you deserve to be paid. If you don’t have a contract, you have no way to enforce your payment even though you did all the work.
Secure your commission with a contract. If it’s a big deal, it is advisable to have an attorney represent you so that you are covered legally. Whether you are to get a buyer’s commission, a seller’s commission, or both, have it clearly written down so there is no confusion.
Have you received less than you expected, or have a buyer/seller try to reduce your commission at the end of a successful deal? Do you always make sure you have a contract spelling out all the terms of your commission?
Mendy Lipsker
Mendy Realty Inc.
822 Montgomery St
Brooklyn, NY 11213
Phone: 646.662.5454
email: info@mendyrealty.com
website: mendyrealty.com
