Paying buyer's closing costs, commission to my Realtor ?

babs77March 23, 2009

I am selling an investment home in the Denver area for full asking price ($135,000) minus $4,000 toward closing costs I am picking up for the buyer. Is my REA's commission based on the full selling price ($135,000) or the selling price minus the closing costs ($131,000)?

Thank you for reporting this comment. Undo
dave_donhoff

Hi Babs,
Refer to your listing contract... the rascals are in dem small print details. That's the only true answer anyone here could give you.

Congrats on getting a solid buyer!
Dave Donhoff
Leverage Planner

    Bookmark   March 23, 2009 at 5:42PM
Thank you for reporting this comment. Undo
babs77

Thanks Dave. I had already looked at my contract but didn't see anything that addressed this specifically but I could be overlooking it.

We're very excited to have sold in only 3 months with the current market. Already looking at buying our next fix/flip!

Many helpful folks on this forumn! Thanks again.

Barbara

    Bookmark   March 23, 2009 at 7:04PM
Thank you for reporting this comment. Undo
mpinto

In my area commission is paid on selling price unless otherwise stated.

    Bookmark   March 23, 2009 at 11:10PM
Thank you for reporting this comment. Undo
ncrealestateguy

Gross selling price, unless otherwise agreed upon.

    Bookmark   March 24, 2009 at 6:40AM
Thank you for reporting this comment. Undo
berniek

Line 227 shows the TOTAL commission and lines 264/5 what the listing company offers the buyer agent out of the total.
In Denver this could mean, line 227 6% (3.2% going to listing company) and lines 264/5 2.8%.

Here is a link that might be useful: Colorado Listing Contract

    Bookmark   March 24, 2009 at 2:42PM
Thank you for reporting this comment. Undo
babs77

Thanks all. Berniek, thanks for the link. My contract looks quite different from the one in your link, but after looking at it again, under "Compensation to Brokerage Firm" I do see where is states "5.0% of the gross sales price in US dollars."

Didn't catch that earlier.

    Bookmark   March 24, 2009 at 3:30PM
Thank you for reporting this comment. Undo
berniek

"My contract looks quite different from the one in your link,.."

Interesting, the link provided is the only authorized contract to be used by an agent in Colorado, unless the agent also is an attorney and can write their own contract.

    Bookmark   March 24, 2009 at 8:41PM
Thank you for reporting this comment. Undo
babs77

Interesting yes! He is not an attorney, as far as I know. My contract is defintely different from yours. Now, not sure what to make of it. Any suggestions? Or just let it go "as is"? To be clear, I have a great relationship with my REA, but just had the initial question about how commissions work on a house you get full asking price for minus buyer's closing costs...

    Bookmark   March 24, 2009 at 11:05PM
Thank you for reporting this comment. Undo
berniek

"The printed portions of this form, except differentiated additions, have been approved by the Colorado Real Estate Commission. (LC50-10-06) (Mandatory 1-07)"

Above are the 1st 2 lines in the contract, note the word "mandatory". Ask if itÂs a standard approved Colorado contract, if not, IÂd have an attorney review it and probably report the agent to here:
http://www.dora.state.co.us/Real-estate/consumer/index.htm

As to commission and closing cost, you probably pay first the commission off the sales price (ie. $135,000-5%=$128,250-$4,000 closing cost=$124,250). If you were to pay the closing cost first and than the 5%, you would save $200.
It all depends on how your listing contract and purchase contract is written.

Here is a link that might be useful: DORA Consumer Corner

    Bookmark   March 25, 2009 at 2:39PM
Sign Up to comment
More Discussions
Lady Realtor coming to house at 6:30pm and its dark outside?
I was looking up homes for sale around me on trulia...
tlbean2004
Purchasing a Home with a Converted Attic
My bf and I are looking to buy a 3 bedroom with room...
bellemorte9506
Getting house ready to sell and have door knob question.
My house is going on 11 yrs old. Everything is pretty...
padillasideas
Retiree - rent or buy home
We are newly retired and have a plan to sell our current...
waterlily_girl
Why would nosey realtor say these things?
It is clear my house lacks a wow factor. I over de-cluttered...
belfastbound
People viewed this after searching for:
© 2015 Houzz Inc. Houzz® The new way to design your home™