NO SUB-Agents

Definition: A real estate agent employed to work in the best interests of a seller in a real estate transaction. The agent's loyalties are with the seller. It is the agent's duty to share with the seller all information about potential buyers that may help the seller make decisions regarding the transaction.

The term Seller's Sub Agent refers to agents and agencies other than the listing agency. For instance, in a Multiple Listing Situation all real estate offices show and sell each other's listings. If a home is listed by Agency A, and sold by Agency B, Agency B is considered a sub agent for the seller unless that Agency B has a valid Buyer Agency agreement with the buyers.

Agent status must be disclosed to all parties.

So in other words she just made it so that it does not matter who wants to buy the property they have to USE HER and only HER.

so you are saying that any buyers agent is considered a sub-agent!?!?! So you're saying no agent can represent the buyer????

That is exactly what I am saying. I am seeing that with a lot of agnts these days that are doing the straight sales and not the REO's.

They wantto get paid twice so they are having the sellers sign no sub-agent agreeements telling them that investors are buying up properties and reselling them to others for a huge profit while the seller gets peanuts.

It makes no sense but its the sellers choice to sign or not but when you have a shady agent they you are suppose to trust pitching this to you, you sign.

Sorry but move on

Also I use my agent and still get 1-1.5% back on any deal I find myself and just bring to him to submit. We have a promissory note for each deal, so he gets paid full commission at closing then he writes me a check for my amount.

what you say makes sence, but it doesnt. So Joe Blow average buyer comes in and has a realtor with him, makes an offer..... So from what you are saying, this realtor with Joe will NOT get paid any commish????

With the no sub agent agreement you WILL NOT be ableto use your agent you will be required to use theirs so yours will sit this one out.

Now that works both ways, lets say you fond a seller that wanted to sell the house and you suggested they use your agent. With no sub agents allowed so the buyer and the seller both would have to use your guy. You could then make arrangements your your Realtor, like I do that he gets paid full commission (6%) for representing both sides but you get 2% back FROM HIM which for bringing him the sale. He just made 4% and you made 2% but you have to get promissory note from your guy, I do, and have had no problem. You see when the Realtor gets paid, thats his money, so he can do what he likes with it and if he has an agreement to pay you part of it then thats his business not the board of Realtors, not the sellers or anyone else's.

thanks. Why would a realtor do No sub agents? No other agents would be telling any of their buyers about the house. It would sit on the market for a long time...dont you think?

...why would she have in the contract between her and the seller 5% commish, but if she brings a buyer it is 4% commish?

with no subs it means she will bring the buyer right?

That is confusing...

its a 3% commission. And yes the other agents are still obligated to give the buyer info on he property if they find it on the mls. but its just another way to make sure all f the business is driven straight to her - so greed is usually the motive. So she may figure why share when I can get it all and the owner will never know the differnce

its not "its a 3% commission."

The sellers agent made a deal with the seller for 5% commish, but if she (the realtor) birngs in the buyer she agreed to do 4% commish.

so that is why the No-subs doesnt make sense...

that doesn't make sense.

So what I gather from that is no matter what the realtor is only going to see a 4% commission. Is there any time or circumstance where you would want to go through with a deal that has a "no sub-agent" agreement?

The agent uses those terms to justify their commission quota. Just like Anita pointed out, any real estate transaction are usually 6% commission if both seller and buyer represent by an agent. Since you represent yourself, you don't have to let the agent dictate how he wants his or her commission. He's only entitle to 3% if represent the seller. You can negotiate where you ask for 3 percent concession. You could ask to use that toward closing cost or goes toward the down payment. You may also want to offer 1 or 2 percent to the seller's agent if he would close the deal for you, but if not, then that's totally your call. Good luck and happy investing!

Lloydsap

It means that this agent isnt going to get paid. Unless a buyer comes in solo no deal happens. And that isnt very likely ie this agent has eliminated the MLS as a resource for this property.

The seller made a huge mistake listening to this bozo.

alot of conflicting info onthe internet about no-sub.....so I asked a few realtors, here what they said no-sub means....

This is coming from the realtors....not me.

Before about 15 yrs ago all agents were considered seller agents and sub seller agents. The buyer was not getting fair representaion. So the No-sub law was created. This meant that the buyer had to have a buyers agent, not a seller agent helping out. This protected the buyers best interest....And this is how it is today. Buyers have buyers agents and sellers have seller agents.

So it does not mean that she will be the sellers agent and the buyers agent and tring to get all the commision. Buyers agents are what she is really asking for.

No body really uses this clause anymore cause buyers will have a buyers agent, or represent themselfs...

Ah... I got it. So no dual representation.

thats what I got from it too.

Then I asked myself....well why would an REA say "hey I dont want to be a dual agent so dont pay me all the commish" lol

ya know?

Well... it IS an inherent conflict of interest.

Buyer REALLY needs to beware in that case.

If it's just Joe 6 Pack and Suzie HomeMaker then they are potentially in A LOT of trouble.

The commission percentage is agreed upon by the seller and the seller's agent. The average is 6% and the highest is 10%. The real estate company that the agent is associated with usually dictates what the agents should accept and that is usually 6%. If an agent can get a seller to agree to a higher percentage then all the better. But, usually a seller is not going to agree to more than 6% because that is the usual percentage that agents can get.

Also, most companies use a percentage scale (I gather to keep the agents motivated to do business). Usually the split is 50/50, but if the agent is not doing sufficient business the agent's split decreases.

If there is a seller's agent and a buyer's agent involved in the deal, the 6% commission is split evenly between the agents (3% each). But, that is not the end of the split! Each agent must again split their 3% with each of the company they are associated with. The seller's agent and the buyer's agent will each get only 1.5% commission on the deal; Company A (seller's RE Company) gets 1.5% and Company B (Buyer's RE Company) gets 1.5%. So, the total 6% is actually split 4 ways. The agent does not get the entire 6% commission. If the seller's agent and the buyer's agent are associated with the same company, the company makes the most off the deal because the company get 3% of the commission (1.5% from each agent).

If the seller's agent finds a buyer in the deal, then that is acting as a dual agent and the agent must disclose that information to buyer and seller. In this case the seller agent only has the split the total 6% commission with the seller's agent company and each would get 3% of the commission.

In the above posts people refer to the 6% as if the agent gets the entire 6% commission. The agents most likely balk at agreeing to giving cash back at closing because they know in reality they are only getting 1.5% in the first place! To agree to giving cash back would mean that the agent would get no commission and as a former agent myself, I hardly believe that the company would agree to give up their 1.5%.

So, I would think twice when asking an agent to pay cash back only because the agent doesn't get the full 6% as the post make it appear.

As I understand sub agency, a sub agent is an agent of an agent. In a sub agency the agent of the buyer is working for the listing agent, which means they represent the seller. Most areas do not use sub agency any more. Now a buyers agent is responsible to the buyer, in a seperate agreement. So the buyers agent does get paid, even if the paperwork says no sub agents. Our paperwork in Arizona still askes what the compensation is to the sub agent. We always say 0. Then It asks what the conpensation is to the buyers broker. This is where we enter the percentage that we will pay the buyers broker/agent.

Hope this helps, Al

You are on the right track. If I can remember from my former agent days --

Sub-Agent and Sub-Agencies existed prior to the existence of Buyer's Agent; prior to a buyer having representation. With the creation of the Buyer's Agent, the "sub-agent/sub-agencies" really ceased to exist.

Prior to "Buyer's Agent", all agents were considered to work for the seller even though an agent was actually helping a buyer locate a home to purchase. Prior to the existence of the "buyer's agent", the agent had to disclose to the buyer that even though the agent would help them locate and go through the purchase of a home, they were really working for the seller.

Prior to "buyer's agent", the primary agent was the seller's agent. The agent who was assisting the buyer locate a home was considered the "sub-agent". The company that the agent assisting the buyer was associated with was considered the "sub-agency".

A buyer's agent has a little more leway than a seller's agent. A seller's agent MUST submit ALL offers to the seller, regardless of how the seller's agent feels about the offer. The seller's agent can of course convince the seller that the offer is a bad offer if the seller's agent doesn't like the offer. But, it is illegal for a seller's agent to withhold any offer from a seller.

On the other hand, a buyer's agent does not have to bring all properties to the attention of the buyer. A buyer's agent pulls properties based on the criteria that is selected by the buyer, but it doesn't mean that the buyer's agent will show EVERY property to the buyer. Agents would most likely discard the property that specifies "no sub-agent" and just not be bothered with the hassle of dealing with it.

In RE agent terms a "sub-agent" refers to the agent that is assisting the buyer. Since the buyers now have a legal right to agent representation, a seller's agent can't refuse a buyer's agent. I think that in the context of what Hazco Investments originally said:

"when I said I would come in with no agent at all then....she said I had the seller agree to NO Sub-agents. I said ok...."

I don't think the seller's agent was saying that he couldn't bring in a buyer's agent, but when he said he would come in with no agent at all, I think the seller's agent meant that she had the seller to agree not to allow (work with) third parties (i.e. investors). So, unless he came in with a buyer's agent he had to go through her or no one.

I hope I helped and didn't further confuse anyone!

Isn't that what realtors call a double dip? when the agent who is selling a house also represents the buyer?

When the seller's agent also represents the buyer it is called a "dual agent".

Yes, when the lising agent or an agent under the same broker represents the seller, this is know as dual agency. Both parties need to sign an agreement that they understand and agree to this dual agency.

Al