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I think the term "realtwhore" is very appropriate here
I'm sorry, doesn't the NAR have an ethics policy? Something about a silly little fiduciary duty to clients?
Guess that section isn't taught anymore...
Posted by
blogger
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5/29/2007
Labels: bribery, desperate homedebtors, realtwhores
22 comments:
I don't see the ethic violation here. This bonus is out in the open for all to see. Had it been some secret backdeal bonus, I would see a problem.
I think Ron Paul just cracked 0.1%.
The violation is, that since the buyer is the only one bringing money to the table, the buyer is also the one paying for the lease of the car.
The buyer may be to dumb to make the connection, but that does not make it right to take advantage of the buyer.
Nothing illegal, hence nothing to see here. Move on please...
I won't miss these awful, horrid people.
Good luck US of A. You really need it in the next couple of years.
Some Realtors actually dress like sex workers. Heck, sex sells, and some of them look pretty good! Offering extra for extra services is the American way. Lenders are no different, just give them more money down and they aren’t concerned about your qualifications.
First, it is not an ethics violation.
My initial feeling is that the owner of the home is in the car selling business.
Second, I'm not a supporter of extra incentive or bonuses of commission.
Why not just lower the price of the home the cost of the bonus (in this case the two year lease)?? I don't sell this kind of pricey property, but I would think that the commission offered in the MLS would be plenty for the representative of the buyer.
While this may be an example of the kind of business practice the blogs author despises, it hardly represents the typical or normal commission a representative comes across on a daily basis.
It's hardly "news" that agents are compensated, IMO. The only issue is how much, and if such compensation is freely disclosed.
As long as the agent's compensation (use of leased car for 2 years, as well as typical RE agents "fees") is freely disclosed to the buyer in writing, I have no problems with it...
oy vey!
Rules 'hiding' trillions in debt
Liability $516,348 per U.S. household
http://ncane.com/1wht
My initial feeling is that the owner of the home is in the car selling business.
My feeling is that the owner of the home is in the car-leasing-to-overpaid-REIC-employee business.
And obviously, needs to Sell Now.
My feeling is that the owner of the home is in the car-leasing-to-overpaid-REIC-employee business.
And obviously, needs to Sell Now.
May 29, 2007 6:03 PM
My feeling is that the closest you will ever come to driving a car like that is....well no you'll never even get that close.
Todd Tarson said...
First, it is not an ethics violation.
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It becomes an ethics violation when the buyer agent pumps-up this home and pans other homes based upon the incentives this seller is giving over the incentives (or lack there of) that others sellers are offering. The only hope is that only sophisticated buyers would be looking at this house. They would demand full disclosure of all incentives given to their buying agent and when the compare the incentives and correlate it to the buying agent's behavior they would terminate any buyer's agent who was trying to game them.
FYI - it is an ethics violation to not disclose all incentives/compensation the seller is giving YOUR agent and the agent refuses.
I would demand that either I as the buyer get the car or that I get a cash equivalent discount on the price of the home or as part of the closing cost allowance.
The fact that REALTWHORE Todd Tarson doesn't see this as a potential ethics violation proves that REALTWHORES don't understand ethics or the NAR's own policies I'd say
This is nothing new. Builder's have done this for at least 10 years, but only in slower times. We must have entered a slower time.
The lease is only about $15k. Not a huge deal on a $60k Buyer's commission.
anon said
It becomes an ethics violation when the buyer agent pumps-up this home and pans other homes based upon the incentives this seller is giving over the incentives (or lack there of) that others sellers are offering.
Yes I agree, the above would qualify as an ethics violation. To this point though (with the house not yet sold) offering a bonus in the form of a two year lease on an expensive car is not a violation. It is merely a form of commission.
The only hope is that only sophisticated buyers would be looking at this house.
The only hope?? How many unsophisticated buyers do you know that can afford a 2 plus million dollar home??
Folks with that kind of coin ask plenty of questions and get plenty of answers. If they don't like the answers, they find someone with the answers they are looking for.
They would demand full disclosure of all incentives given to their buying agent and when the compare the incentives and correlate it to the buying agent's behavior they would terminate any buyer's agent who was trying to game them.
Well I demand that my buying clients negotiate how much they are going to pay me before we ever talk about disclosing incentives and other commission. Any amount of MLS offered commission offered to me over the negotiated rate belongs to the buyers, given back to them in escrow. (Most definitely means that I won't be driving the Benz after closing)
Buyers should know how their money is spent AND have a say in the matter.
I would demand that either I as the buyer get the car or that I get a cash equivalent discount on the price of the home or as part of the closing cost allowance.
And this is a smart move, one I'd support fully. It is, after all, your money. You are the buyer.
I don't like offering extra incentives to other representatives. I do ask the seller to offer a traditional percentage to the buyers broker if the listing is to appear in the MLS, but they don't have to. It is all negotiable.
I'd rather see the seller offer the incentives to the buyer, in most cases the amount of incentives off the asking price.
But again, I don't sell million dollar plus homes. I don't market to that kind of clientèle, so I don't know the most effective means to that end.
The bonus incentive is newsworthy, maybe, at best. Somebody already mentioned that the lease might be worth worth 15k. That is less than one percent of the asking price of the home. My fee to sell this home, if I had the buyer, is even less than that.
anon said
The fact that REALTWHORE Todd Tarson doesn't see this as a potential ethics violation proves that REALTWHORES don't understand ethics or the NAR's own policies I'd say
Until it is an ethics violation, it isn't. Offering commission in the MLS is not an ethics violation.
Now if I only show that listing and that listing only AND tell my potential buying client that there are simply no other listings in the area for sale... I better be facing an ethics hearing violation.
The seller is offering the lease of the car as part of the commission, that is the only fact. You may have a disdain for this practice, but it is your opinion and you are entitled to it.
Selling bonus' and extra incentives do not impress me much since they are given back to my buying clients anyway.
Todd said:
The only hope is that only sophisticated buyers would be looking at this house.
The only hope?? How many unsophisticated buyers do you know that can afford a 2 plus million dollar home??
Folks with that kind of coin ask plenty of questions and get plenty of answers. If they don't like the answers, they find someone with the answers they are looking for.
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E.g. Casey Serin albeit 2+ million over 8 houses. The lady in the recent USAToday piece ~900k, etc. There appear to be many unsophisticated buyers getting mortgages in the million USD range. that was my point. I was intimating that at that price point the buyers would be pretty well informed and not let the price/cost implications of this incentive slip under the radar screen. Thanks for your candor. If I had had an agent like you I be in a better situation myself right now.
PS - please comment on agent behavior if they buying agent REFUSES to disclose their compensation/incentive package from the seller. You must admit there is an inherent conflict of interest for a buying agent to be compensated by the seller. Having a separate agreement b/t the buying agent and the buyer that partitions the compensation b/t the two does negate this conflict but of course this arrangement requires full disclosure of the listing's compensation.
PS - please comment on agent behavior if they buying agent REFUSES to disclose their compensation/incentive package from the seller. You must admit there is an inherent conflict of interest for a buying agent to be compensated by the seller. Having a separate agreement b/t the buying agent and the buyer that partitions the compensation b/t the two does negate this conflict but of course this arrangement requires full disclosure of the listing's compensation.
Look, I'm not trying to spin this at all, but I believe that the buyer pays all parties in a transaction. Without the buyer's funds (even if financing is needed) nobody working for anyone is getting paid -- including the sellers. I know the 'official' accounting does not work this way but I just have a different philosophy is all.
I hate hearing buyers agents telling their clients that the buyers don't pay them for representation. On the books the seller pays the listing broker the negotiated fee, and the listing broker turns around and shares a portion of those funds with the buyers broker. Seemingly the buyer did not have to pay for the service their representative gave them.
But none of this happens unless a buyer agrees to bring money to the transaction. Money that is then used to pay all.
You asked me to comment on the situation when a buyers agent does not disclose the commission/incentive package and I think it should be pretty clear where I stand on the issue.
If you or anyone CHOOSES to have representation on the buying side of a property transfer, don't settle on the representative that insists his/her commission is paid by the other party. Demand to negotiate a rate that you think is fair given the circumstances of the transaction. Ask to agree to terms on a buyers/brokers agreement or have the agent draw one up that you are comfortable with. The representative works for you, not the other way around.
Traditional brokers don't like some of the things I say, but this isn't a traditional business anymore with the emergence of the Internet over the past many years. The Internet, the market, and the forces of capitalism will pave the way for something better for all. Something a lot more transparent.
But it starts with the clients having the guts to either go it alone or at least not settle on things a traditionalist in the industry tells them. The answers the clients seek exist.
I'm a Financial Advisor(Stockbroker). If a fund company offered me this deal to steer customers into their funds, I would be out of work and the fund company would be fined because of ethic vioaltions and it not being in the best interest of the client. What's the difference here? This is bullcrap.
I'm a Financial Advisor(Stockbroker). If a fund company offered me this deal to steer customers into their funds, I would be out of work and the fund company would be fined because of ethic vioaltions and it not being in the best interest of the client. What's the difference here?
Can a fund company offer you any kind of commission?? If the answer is no, then that is the difference. Sellers CAN offer commission to the listing broker and the listing broker CAN offer part of that commission to a buyers broker. It is legal and ethical.
The other key to note is that all commissions must be disclosed to all parties to the transaction (including lenders). Why I disagree with this practice (of paying commission with a bonus or whatnot) is because this offer (of the lease on the car) should go to the buyer of the property, if they even want it.
Now it IS illegal to accept offers of commission from lenders, appraisers, inspectors, and others that are not sellers/owners of the property.
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