Working with Buyers When ZERO Commission is Offered by the Seller!

How to Work with Buyers When Zero Commission is Offered: A Step-by-Step Guide

Welcome everyone! Today, we’re going to provide a step-by-step guide on how to work with buyers when zero commission is offered. This is a crucial topic given the recent changes in the real estate landscape, and we want to ensure that all real estate agents, brokers, and managers are well-prepared. I’m Mike Ferrante with Century 21 HomeStar and the 21 Mike Team, and joining me is Tony Geraci, Broker/Owner of Century 21 HomeStar.

Step 1: Buyer Consultation and Required Paperwork

The first step in the process is conducting a buyer consultation and getting your necessary paperwork signed. In Ohio, this includes the Consumer Guide and the Buyer Agency Agreement. This step is essential for setting the right expectations and ensuring that your buyers understand how you will get paid. You may need to have this consultation in the driveway of the first house if the buyer is eager to start viewing properties immediately. Setting the stage correctly from the beginning will help mitigate any misunderstandings later.

Step 2: Find Out What’s Offered

Once you have your paperwork in order, the next step is to find out what commission, if any, is offered by the seller. This will often require contacting the listing agent via call, text, or email. It’s crucial to understand whether the seller is willing to offer any commission to the buyer’s agent and, if so, how much. In many cases, this may involve some negotiation, and you should be prepared for various responses from the listing agent.

Step 3: Discuss It with the Buyer

After you have gathered the information about what is offered, the next step is to discuss it with your buyer. Inform them of the situation and reiterate the terms of your buyer agency agreement. This discussion is vital, especially if no commission is offered by the seller. Your buyer needs to be aware of their options and the potential costs they may incur.

Step 4: Write the Offer

If your buyer decides they want to proceed with a property, you will need to write the offer. When drafting the offer, include the details of the commission as stipulated in your buyer agency agreement. Utilize any relevant documents provided by your local real estate association. For instance, in Ohio, we have a document from Ohio Realtors that clearly outlines who is responsible for paying the commission.

Step 5: Negotiate

The final step is negotiation. This step may involve not only negotiating the price of the property but also the terms of your commission. If the seller is not willing to pay the commission, you will need to negotiate with your buyer to determine how the commission will be covered. This could involve requesting closing cost assistance or other creative solutions to ensure you are compensated for your services.

Additional Tips:

Consult with Lenders: Before getting too far into the process, discuss potential scenarios with your buyer’s lender. Understand what options are available for covering commission costs through closing costs or other means. This foresight can streamline the negotiation process and provide clarity on what is financially feasible for your buyer.
Legal and Ethical Considerations: Always ensure you are adhering to legal and ethical guidelines. Be transparent with your buyers and sellers about how commissions will be handled and document all agreements clearly.
Adapt and Be Flexible: The real estate market is constantly evolving. Stay informed about the latest changes and be ready to adapt your strategies accordingly. Flexibility and a willingness to learn will be key to navigating these new waters successfully.

In summary, working with buyers when zero commission is offered requires thorough preparation, clear communication, and effective negotiation skills. By following these steps, you can ensure that both you and your clients are well-protected and that transactions proceed smoothly.

If you have any questions or need further assistance, feel free to reach out. And as always, we’re here to help you navigate these changes in the real estate market. Thank you for reading!

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