Through our extensive research and self education over the past week, we have learned that every office and brokerage is doing things a bit differently. They are giving different advice. It is incredibly imperative that you speak to your Broker and find out how they want you to discuss commissions with buyers and sellers and exactly how they want the forms completed.
Profile TM is here to help in every way we can; however, like our other form completion services, the agent (you) have the responsibility for the content that’s entered into every form. Unlike most of the content that’s entered into a purchase agreement, these form changes have tiny variations or errors could dynamically and dramatically impact your income. It’s important for you to educate yourself through your office or NAR.
Our goal is to provide a second set of eyes to the best of our ability. We will continue to ask some basic questions for clarity. If we see something that doesn’t look “right” we will mention it and confirm what was requested is accurate. You, as the licensed Realtor, need to be extremely specific and clear on how you want the forms filled out, including line numbers for reference, exact text quotes and proper title of the forms you’re referring to AND exactly what line you want certain percentages or numbers entered.
We are already seeing major errors and mistakes on documents. The most common mistakes would receive $0 dollars in compensation.
We will be sending out regular communications for education that will include recorded trainings with local brokerages to aid in your eduation on how to properly use the forms to protect your income. If you have specific questions about a unique transaction, please reach out to your Broker. Your Broker will ensure you stay compliant within your companies policies and ensure that you are properly compensated for your efforts.
Eventually, this will be the regular way of doing business, but in the meantime, we expect that you will encounter co-op agents that understand the forms differently and/or have no understanding of the new forms, so please be patient with them and us as we try to help navigate all the nuances these NAR changes have set into motion.
We, along with your title company and brokerage, are here to support you as you learn to navigate these new processes.
Here are a few scenarios approved by a local Minnesota broker.
Minnesota Real Estate Licensees are not permitted to collect MORE commission/bonus/compensation than what is on your signed Buyer Representation or Facilitator Contract.
Scenario 1
If you are offered more compensation from the seller or listing broker than what was on your buyer representation contract.
Please choose one of the following options for compliance.
Options – Each option is assuming you, your broker and your buyer agree.
A. You can take the additional $ (Give us the wording for the amendment, and we will send the amendment to the buyer representation contract for you and your buyer to sign, disclosing the raise you just got)
B. Give it to your buyer as additional $ to help cover closing costs. (Let us know exactly how much, and we will add it to the PA for you in the closing cost section)
C. Share it with the buyer. You take more $, and they get some for closing costs. Win-Win! (Give us the wording for the amendment, and we will send an amendment to the buyer representation contract for you and your buyer to sign, disclosing the raise you just got, and add the closing cost to the PA for you)
D. Decline it; the seller pays less commission, and you offer less for the house. (Let us know what you want for the new price to be on your offer)
E. Decline it; the seller pays less commission.
*It’s recommended practice to confirm with the lender or with the buyer that they have sufficient funds or financing approval to cover the sale price closing costs including down payment and any commissions that need to be collected.
Scenario 2
If you are offered less compensation from the seller/ listing broker than what was on your buyer representation contract. Please choose one of the following options for compliance.
Options – Each option is assuming you, your broker and your buyer agree.
A. You charge the difference to the buyer. Your Compensation Disclosure will have the commission being offered by the seller side on the seller line 7/8 and the difference on the line 10/11 being paid by your buyer to make the full amount on your Buyer Representation Contract.
B. Give your Buyer a discount. (Give us the wording for the amendment, and we will send an amendment to the buyer representation contract for you and your buyer to sign, just so it is all nice and clean)
C. Negotiate with the seller as a term on the contract. You can add in commission requests to be paid by the seller on line 406 on the PA (Let us know what you would like to enter)
