Cancel Buyer-Agency Agreement With Real Estate Agent
Added March 10, 2009 by Ilyce R. GlinkSummary: How can you end a buyer-agency agreement with a real estate agent after you've agreed to hire that real estate agent to help you find a home? Canceling a buyer-agency agreement with a real estate agent may involve paying a fee to the real estate agent. To cancel a buyer-agency agreement with a real estate agent you need to tell the agent why you want to cancel. Depending on how long you worked with your real estate agent, he or she may be understanding when you explain you want to later buy a for sale by owner home without an agent.
Q: A friend of mine is looking to purchase a home and has signed a contract with a Realtor to help her in this process. I happen to be selling my home by owner (as a FSBO). My friend is very interested in my home and wants to know if there is any way to get out of the contract without penalties since there will not be another Realtor in the deal.
A: This sort of thing happens frequently in real estate. Buyers use real estate agents and sometimes even sign representation agreements. Your friend should look carefully at the agreement she signed.
How long does the agreement last? Is there an exit strategy outlined in the agreement (in case she decided to stop looking or change agents)? Is there a penalty stipulated in the agreement?
Once your friend fully understands the agreement she signed, she may want to go to her Realtor and discuss what has happened. Your friend will have the option of paying the Realtor the fee owed under the agreement, negotiating an amount that would be less than the amount required or waiting until the agreement expires and buying without the Realtor.
Depending on how much time the Realtor spent with your friend, the Realtor might be willing to change the original agreement. If she only spent a day or two with your friend helping her look for a house, she might be okay with a small fee. If not, then your friend should speak to an attorney for information about her options under the contract.
It's far better to be upfront about this situation than to try and sneak behind the Realtor's back. If you and your friend wind up doing a deal, please hire a real estate attorney who help you through the process, so that you're sure to protect yourself and preserve your friendship.
March 5, 2009
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Comments
pah says
good advice. However, Pay the realtor a reasonable day's wages for the time he/she put in the job. Would not negotiate a % of fees. If they won't be "reasonable" for a days labor, then you've found greedy people. Don't deal with them at all. Make them prove out of pocket expenses, backed by receipts from where the money went. Yes, contracts/agreements are just that and so are greedy people. Most contracts are written to protect.....and what does that mean, "protect who", protect fairly? The avg. citizen is not an expert. The days of getting "stuck" just because are gone. Stand up for yourself. Wanting to do the right thing doesn't mean others want to. So don't give your lunch away. Fact......others have walked away from the closing table and did not pay a dime. You can also. However, be fair and pay a fair days wages plus proven expenses. Do what's morally/ethically right however, don't succumb to greed just because it's in print.
Jamax says
I like "pah's" comment. ALWAYS do what's morally/ethically right. I recently completed a home, acting as my own general contractor after firing my GC. We never actually got to the contract stage, but he put considerable effort into our arrangement, and I learned a lot from it. Then a hired another contractor as an advisor, and fired him after he couldn't do what I asked from him. Again, he tried, and I did receive something. In both cases I gave them $1,000 for their efforts, and parted amiably with no regrets on either side.